When and How to Outsource – 4 Essential Questions

I am often asked about the role outsourcing plays as part of my graphic design business. Do you take on a job from a European or American client, employ an Asian freelancer to do it and sit back and take the profits? Er, no!

outsourcing globe

I have been outsourcing projects for years now and there’s definitely a right way and a wrong way to do it. If handled correctly, outsourcing can increase your profits while maintaining or even improving the service you provide to your clients.

I’d love to hear what you think about my video (my first talking to camera!) where I discuss what projects to outsource, how to charge and what to tell the client.

What jobs should you outsource?

It is essential you understand how to do a job before you outsource it. Never outsource the whole of a client job. I have seen people outsource website creation and get into a whole heap of trouble. Trust me, it’s not worth it.

There are two occasions when I outsource:

  • The first is when I know how to do the work but I don’t want to do it because I don’t have time
  • The second is when I don’t know how to do the work but when it’s only a part of a job

With client work, I only outsource up to 50% of a job if I did’t know how do it, and even then, I would have a nominal understanding of how to do it. I typically outsource a bit of PHP or JavaScript that are parts of a website design and development job.

You will only benefit from outsourcing if you use it sparingly in your business – especially at first.

How do you find the right person for the job?

This is the most important part of outsourcing. There are many people out there that will do a great job for you. However, there are even more people that will say they’ll do a great job but won’t. Your skill of finding the best candidate for the job will be crucial to the success of the project.

I primarily use oDesk and Elance for outsourcing (those are affiliate links so if you hire someone through those links I may receive a small commission).

advanced-search-link-odesk

If you are looking on oDesk, for example, always click the Advanced Search link. (There are similar features on Elance, you can also filter search results even if you don’t do an advanced search but the important point is to filter the results).

advanced-search-odesk

Here is an example of how you may like to search/filter candidates on oDesk or any other outsourcing website. As you can see, I try to narrow down the results to those people who have good feedback scores and lots of recent activity. I also don’t want to hire someone who is too cheap or too expensive.

good candidate stats odesk

The above is an example of a candidate who has good feedback over a number of jobs (feedback is measured on oDesk by zero to 5 stars – so look for an average of 4 stars and above). If this candidate has the skills you are looking for then you can get in touch with them and start a conversation about the job.

The next few exchanges with the candidate are very important. You can be messaging a number of candidates at this point to see which one provides the best answers.

Provide a detailed description of the job along with links and files. You will easily be able to see which candidates understand the job by their comments or questions.

So, engage in this two tier filtering process before hiring somebody on oDesk or Elance:

  • First, filter the results to the candidates with the best and most recent feedback
  • Second, filter the few candidates you then contact by evaluating their initial responses to your project

How do you quote the client?

When deciding how much to charge a client I always advocate calculating the number of hours a project is likely to take in the worst case scenario and multiplying that by my hourly rate. This is no different with outsourcing.

If you expect the work on the project to take you 10 hours and the outsourcing work to take 10 hours, then you should quote the client for 20 hours times your hourly rate (plus the time spent finding and managing the outsourcing staff).

If you don’t know how many hours the outsourcing task should take – you shouldn’t be outsourcing it and charging it on to a client.

The hourly rate that you pay the outsourcing site may be much less than your hourly rate – this is immaterial. If something goes wrong with the outsourcing you will still be expected to complete the job on time and on budget.

Do you tell the client?

No, the client employs your company to do a job by a certain time for a certain price. The client shouldn’t be concerned with how the job is done. However, if you do have a contract it’s as well to mention it. I have a contract template that includes a clause under the heading “Assignment of Work:” which states:

Consultant reserves the right to assign other developers or subcontractors to the Work to ensure quality and on-time completion.

What you can do

Remember, the whole point of outsourcing is to increase your profits while maintaining or improving your quality of service to the client.

Ask yourself these questions: Are there any tasks that you could successfully outsource? How could you write a brief for candidates to ensure that a project could be effectively completed? Would I be able to “rescue” this job if the outsourcing goes wrong?

I would love to hear your thoughts on this subject.

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Comments

  1. says

    Great article and video Rob. I wondered if you have used any Indian programmers? Travelling India and Nepal this year I can’t help but see how much advertising there is for courses in all forms of web development. I’m tempted to go on a course just to see what is taught.

    • says

      Yes, definitely, Indian, Pakistani and Bangladeshi – they’re all pretty strong on the programming side. I’m sure programming is just right for them – it suits their education system, their internet speeds, their standard of English? I think a lot of oDesk people from the sub-continent have jobs and supplement their income with oDesk work. I don’t know anything about this, I’m just guessing from my experience with the outsourcing sites. I’m still jealous about your travels! :(

      • says

        Thanks Rob good to know. I need to get someone for some JS and PHP help soon. Living in India this year it makes sense to seek out a local, but quality of work is always a concern. I’ll give it a go and see.

        • says

          Remember to sort all the applicants by their feedback scores and don’t be tempted to go for the cheapest, if you do it with oDesk. (There’s that affiliate link! ;) ) Be ultra-careful to explain everything really clearly.

  2. Rose Pfiffer says

    Interesting article, Rob. I have a small seo business and I have been getting a huge number of clients wanting our service. With a little staff in the back office, we rarely get deadlines missed! I have been thinking of hiring a local, but for me, it just isn’t the wise choice for a small business that’s starting out. It’s a good thing I came across this article, I have been looking into hiring someone from odesk, staff.com or elance. They were all recommended to me by a friend who’s been outsourcing for 4 years. What do you think of staff.com or elance, by the way?

    • says

      Hello Rose, glad you liked the article and thanks for your comment. Personally, I’ve used Elance and oDesk and I wouldn’t be able to choose between them. Both are good and give you the ability to sort through candidates based on their previous feedback, skills, price, etc. Both sites can be frustrating to use at times. I’ve tended to use oDesk more than Elance but for no particular reason! I’ve never used Staff.com. I hope this helps. :)

  3. says

    Hi Rob, thanks for the great post and for all your great advice. You have quite a few links here and I’m following and reading them. Until later…

    Angela