Outsourcing vs. Hiring In-House

  • 07, 04, 2016
  •  Web Admin
  •  Blog

Hire or outsource – one of the defining questions for how we do business in the 21st century. So which is the better route? Both have their own perks and downfalls.

There are factors that you should consider in weighing your options. Here are some of the pros and cons of in-house hiring and outsourcing to help you make the decision that’s right for your business.

 

Advantages

Cost savings: Cost control is a driving issue for most industries and a prime motive for outsourcing. In-house staff wages and benefits (such as pension, medical, vacation) may have become too costly for the company to subsidise. Cost is also a function of a contractor’s ability to flex up and down faster than in-house staff; additionally, hiring costs are absorbed by the agency, My Global Team. An outsourced contractor assumes the burden of these, and other, financial liabilities associated with workers.

 

Staffing flexibility, expertise and work quality: An outsourced My Global Team contractor can provide flexibility in delivering the proper staffing level and required skill set quickly, with less cost and time investment, as well as providing expertise that may not be available, or is inadequate, within the in-house staff. This expertise will also positively impact the quality of the work being performed. It provides the flexibility to utilise specialised services as needed, instead of incurring the cost of developing in-house competencies that are not needed on a permanent or continuous basis.

 

Personnel matters: In the majority of instances, when a client completely outsources its maintenance function, personnel grievances, disciplinary actions and issues become the responsibility of My Global Team. Former in-house activities such as payroll, time keeping, labor relations, HR, benefits, etc., are handled by the agency, releasing management from the responsibility and time requirements of doing so.

 

Tools, equipment and technology: An outsourced My Global Team contractor can provide staffing well-versed in the usage of the most current technology, without the need of the company to provide training to the in-house staff in its use, or the cost of acquisition of the technology/equipment. The same holds true for specialised tools and equipment, in that the agency would be required to supply the tools and equipment to perform the work required.

 

Core business focus: Outsourcing allows management to concentrate on their core proficiencies and critical objectives to drive the business.

 

Reduced Operational and Recruitment costs: Outsourcing eludes the need to hire individuals in-house; hence recruitment and operational costs can be minimised to a great extent since end-to-end hiring will be handled by the agency, My Global Team. This is one of the prime advantages of offshore outsourcing.

 

Disadvantages

Loss of control: Outsourcing the maintenance function may be cost-effective, but there are restrictions when working with contractors, such as the host company’s inability to directly manage and instruct the workforce. Another example is it may be difficult for a service provider to fulfill all of a client’s requirements such as staff flexibility or craft availability within the host company’s expectations.

 

Staff turnover: In-house employees are inclined to have more years of service at a facility than employees of a contractor and know the business and its expectations better. This is a common issue for clients, as outsourced staff do not, as a rule, possess as much allegiance to the company.

 

Redundancy in management roles: Roles may be duplicated within a client and contractor organisation, contributing to overall cost. Overlapping roles and responsibilities can lead to inefficiencies within the maintenance organisation and contribute to the appearance of too many bosses and not enough workers, create conflicting priorities and confusion.

 

In the end, it is up to the end user to determine the cost-effectiveness, control, flexibility and focus required at their unique site to properly manage their maintenance function within their particular budgetary constraints. Outsourcing does not mean abdication of management responsibilities. Most companies end up with a hybrid model. You’ll likely to have in-house staff while retaining outsourced staff to work hand in hand. You have to perform a detailed examination of these factors to establish whether outsourcing is a viable option or not. Ready or not, you could always consult with the experts at My Global Team to provide you with the best staffing solution.

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