Outsourcing is the term often used to describe the act of hiring another company or individual to perform a task. It is often associated with initiatives like offshoring, where products and services are designed once in one country and distributed globally.
What is Outstaffing? It is the idea of contracting with a company that has employees who do all the work for you, doing everything from research to administration. Here are some tips to help you decide which option works best for your situation.
Factors When Choosing Between Outsourcing vs. Outstaffing
Size and Scope of the Project
If the project is relatively small, a one or two-man job, you can do it yourself, thus saving on outsourcing costs. If the project is large and complex, consider outstaffing. Talk to your client about whether the part of the work you are doing for them is something they want to keep for themselves in the future.
The cost of outsourcing can be much higher than outstaffing. Depending on the skills needed, the cost of outsourcing can vary significantly. For example, a call center will be more expensive than a person on an hourly wage. Outsourcing is generally more costly because you are hiring an entire team. Their salaries will vary even if you contract with the same company for the same project next year. Therefore outstaffing companies typically have lower costs, mainly because they have to recruit and train people from the street who need to be more qualified.
Outsourcing companies can have different standards. They might ship your order to a factory in some part of the world, where they will make it as cheap as possible and send it back to you without inspecting it. In such cases, you might end up with a product different from what you expected or had ordered. The outstaffing definition always ensures that the company you hire will be a certified responsible, ethical organization.
When to Use Outsourcing and When to Use Outstaffing
Outstaffing is best when you need a broad and deep range of skills. In such cases, it will be easier for you to fulfill the need if you hire someone trained in that field. On the other hand, outsourcing is good when you need to gain the necessary knowledge but can train someone new to get it done. The staff augmentation service is an excellent option to solve these problems. Accordingly, hiring IT and technology professionals or contract staffing services is a perfect option to solve these work problems.
How to Choose Between Outsourcing and Outstaffing?
Understand the Products and Services That You Need
Take some time to understand precisely what you are buying before you make a final choice. Outsourcing and outstaffing may look very cheap on the surface, but the hidden costs can be higher than the outsourced amount depending on how complex and tedious the needed job is.
Always Perform a Cost-Benefit Analysis Before Making a Final Decision
This is more than just checking how much it will cost. It’s essential to get the total benefits of outsourcing or outstaffing before deciding on one.
Understand the “No-Risk” Factors of Outsourcing vs. Outstaffing
Outsourcing and outstaffing companies are all different. Some are good at doing a project for you but only provide a little training to their employees, who may need to improve in that field.
When Should You Outsource Or OutStaff?
When You Are New to the Field
Outsourcing and outstaffing companies do have some necessary training. However, new professionals working in a field with little or no experience will be able to learn much faster if they work with someone who has trained in that particular field of work.
When You Need a More Extensive or Competent Team Than You Can Afford
It is always good to consider what you can and cannot afford before committing to something. Outsourcing or outstaffing will be expensive, and for small projects, costs can quickly add up if you need more cash flow.
When You Need Specialized Skills or Talent Doesn’t Exist Among Your Existing Workers
Outsourcing is an excellent way of getting specialized skill sets when you need them and when they are not available in the market currently. Hiring IT and information technology professionals or contract staffing services is an excellent option to solve these work problems.
Outsourcing and outstaffing are both used to get the needed skills and people. According to some experts, outsourcing is the best way to hire competent people, while outstaffing could be an excellent way to engage those who are not there yet but with the same understanding that you can train them so they become ready in time. However, you should always ensure that you understand precisely what you’re using before making a final decision.