As your business grows, you will eventually need to add new or expanded capabilities. Maybe your revenue growth has maxed out your capacity. Or perhaps you have ideas for creating new products and services to expand your offerings. Inevitably, you’ll have to backfill roles as people are promoted, retire, or move on. And you’ll be faced with this decision…
Should I Hire or Outsource?
As is the case in virtually all decisions, there are pros and cons of both. There are usually some clear-cut financial costs and benefits, and some murkier non-financial costs and benefits.
Knowing whether to hire or outsource can be tricky. There are lots of things to consider and it can be overwhelming. Either route requires an investment of time, energy, and money. It’s not uncommon to delay a decision to avoid making a mistake. But putting it off often limits your growth.
I’ve come up against this decision in our own business several times – for all of the reasons I mentioned above. Here are some of the factors I’ve considered along the way:
- Begin with the end in mind – what’s the vision for this role?
- Is this a long-term position or a short-term project?
- How connected is the role to the primary business differentiators/competitive advantage?
- Will a team be built around or under this role at some point?
- Identify and consider the core accountabilities of the role
- How specialized is the skillset needed?
- How broad or narrow is the scope of accountabilities?
- Who would provide direction and oversight to this role?
- How much access or control do I want/need over this work?
- Weigh the pros and cons
- What are the financial costs and benefits?
- What are the non-financial costs and benefits?
- Is there a third alternative?
- What if it doesn’t have to be one or the other?
- Am I oversimplifying my options?
- If I couldn’t hire or outsource, then what would I do?
Adding people to your team is a big deal – whether they’re internal hires or outsourced contractors. It impacts your financial model and your culture. It creates additional opportunities and responsibilities. It’s the best of times and the worst of times. Well, maybe I got a little carried away with that last one, but perhaps not – sometimes that’s the way business growth feels.
Consider both financial and non-financial costs and benefits
As your face the exciting, but weighty decisions about expanding your team, certainly calculate the financial costs and benefits. And – go deeper. Consider the long-term vision, the scope of the role, the non-financial pros and cons, and the possibility that it’s not always an either-or decision.