Inhouse or Outsource


The question in the headline isn't exactly relevant if you have just started your own business. In your sole proprietorship you're doing everything: customer service, sales department and administration, so it may seem far-fetched to consider whether it's most profitable to have a given department in-house or external. But if you're a leader in a larger company, it's a must that you sooner or later consider letting others stand for those parts of the business that aren't a central part of your core service. It can often pay off to focus more on the core business if this gives a larger turnover than it costs to outsource the parts where you don't possess sufficient competencies.

Outsourcing - Benefits

Outsourcing describes the phenomenon in which parts of the business are left to other companies that work with this on a daily basis, so that the released resources can instead be used in areas that create more value for the company, which outsources. The biggest advantage of outsourcing is that you can instead spend money, time and effort on the things that create the greatest value.

If you have a production company, it can be a good idea to outsource the IT department, for example. Firstly, you don't have to recruit employees with IT competencies that can be difficult to dust up, and secondly, you must not pay wages during illness, maternity leave or the like. You don't compromise on your IT support - both remote support and onsite assistance are available. There are virtually no disadvantages of outsourcing the IT department, as one will often get attached to a fixed supporter who has his usual time in the company. You can also get help from an IT supporter 24 hours a day . This of course requires that your need for IT support is big enough - if it's just about one inquiry every month, it may be overlooked. In general, there is great potential in outsourcinginformation technology and consulting .

Inhouse benefits

However, it's specially advantageous to have all functions and departments in-house - namely control. If you outsource parts of your business to others, you'll undoubtedly lose some of the control you previously had with that department. With the department inhouse, it's unconditional that you decide how the resources - both employee and economic - are best used. You'll also be able to hire and dismiss as you see fit, which is also partly possible through outsourcing, as you can scale the solution so that it's adapted to the financial situation.

However, there are some companies where the loss of control is such a major drawback that one doesn't want to outsource. It may also be that a department is so closely connected to the core service that it doesn't pay to let others handle this. If one loses control of such a function, it may mean that quality is deteriorating as it's difficult to oversee an external partner who may not have the same incentive to perform as well as you or your own employees. If this is the case, it might be a good idea to keep a given department inhouse.

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