You should outsource tasks when it makes financial and business sense to do so. This will depend on the tasks involved, and the capacity and expertise of your own staff.
It’s most common to outsource tasks that aren’t central to your core business, such as payroll, IT support and accounting. That’s because these tasks require expert knowledge and it’s often not worth employing specialist staff for such peripheral and infrequent functions. External providers can achieve economies of scale on these types of tasks, leaving you to focus on your core business.
However, bear in mind that you’ll be ceding direct control over these tasks, so ensure that you put adequate checks in place to maintain quality standards.
Other tasks that may be partially outsourced include pieces of your marketing strategy that you could not pursue in-house, either as a result of capacity or expertise. Just remember to add the cost of a marketing agency onto the overall cost of acquisition when you do export some marketing activities!
Automating and integrating administrative functions can be appealing to businesses looking to cut staffing costs and save money. However, you should carry out a thorough cost-benefit analysis before making a decision. You need to tread very carefully to avoid common pitfalls.
In particular, look at whether there’s an automation system that truly meets the needs of your business. There will be additional costs if you need to change your business practices to meet the requirements of a piece of software, or if you need to commission bespoke changes to the system to make it work for you. Think about how much you trust the system and how much maintenance and technical support services will cost.