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Outsourcing, Automation, and the Future of Business Scalability

The business world of today is almost impossible to recognize compared against the business world of 15 years ago. So much has changed at both a fundamental level — attitudes and ideas — and a technological level. When you combine the shifts in the way people think with the accessibility of modern innovations, it’s easy to see why and how we’re experiencing such a profound revolution.

In particular, it’s noteworthy to examine two very specific factors: the rise of the gig economy and the rise of automation. They’re enabling businesses to address major problems that have historically made it difficult to scale efficiently.

How are these developments contributing to the present and future of business scalability for startups, small businesses, and large corporations alike?

Rise of the gig economy 

Over the last decade, freelance marketplaces like Fiverr, Upwork, and Freelancer.com have gone from small websites with niche appeal to major players in the global economy. Platforms like Uber, TaskRabbit, and Shipt — and dozens of others — have enabled individuals and businesses to buy nearly any service they want from the convenience of a computer (and for just a few bucks).

Whether it’s a private ride to the airport, a startup logo design, or help with a digital marketing campaign, there’s someone capable of doing it on a freelance basis. To date, more than 48 million people have registered globally on websites that allow them to sell their time and labor. This number is expected to double in a few short years.

The gig or talent economy can be highly beneficial for the freelancers performing the gig. But it’s also important to think about it from a business perspective. When Toptal surveyed more than 1,000 business leaders and managers around the world, it gathered interesting data on why they chose to work with freelancers versus full-time employees. Interestingly, it had very little to do with cost savings. Instead, there were three primary drivers for engaging freelancers:

Flexibility

Businesses don’t want to marry full-time employees if they don’t have to. The ability to hire freelancers for one-off projects and isolated tasks affords maximum flexibility. Once the project is complete, there’s no lingering salary or obligation.

Access to expertise

When hiring on a gig basis, businesses are able to access experts for each and every task they have. They don’t have to hire someone with a generalized skill set in multiple areas.

Speed

As anyone who’s worked in HR knows, the process of finding, hiring, and onboarding new talent can take weeks (if not months). Hiring a freelancer, on the other hand, takes just a few hours. This increased efficiency saves time and money while promoting productivity.

People can talk all they want about the appeal of freelancing and side hustling from the perspective of the talent. But it’s ultimately the attractiveness of outsourcing from a business point of view that makes the gig economy sustainable. As long as business leaders see value in outsourcing work, these relationships will flourish. And at the moment, every indicator suggests this trend is here to stay.

Rise of automation 

Simultaneously, we’re seeing a swift rise in innovations and technologies that enable businesses to automate core tasks and responsibilities. From software that streamlines marketing tasks like email campaigns and social media to bots that engage customers and enhance customer service, automation is everywhere. The major benefits of automation — at least as business leaders see them — include:

Cost savings

According to a report by Capgemini Research Institute, businesses could achieve as much as $165 billion in cost savings by 2022 through wide-scale adoption of automation. This is a huge driving factor in the push for automation.

Time savings

Any time a business can automate something that was previously performed manually, the company saves time. This allows business leaders to reallocate that time toward core business activities that move the needle for the business.

Improved quality

Believe it or not, cost and time savings aren’t the main driving factors for businesses relying on automation. The No. 1 objective behind automation initiatives is to improve quality. Automated solutions — the right ones, at least — remove human error from the equation, promote consistency, and lead to a superior end product for customers. It doesn’t get much better than that.

The rise of the gig economy and the growth of automation is happening in tandem. They’re parallel forces for good, and businesses that learn to leverage both stand a greater chance of growing and scaling their businesses with ease and efficiency. 

Progressive ways businesses can scale with greater efficiency  

Growing companies face a number of distinct challenges. When it comes to scaling, organizations have to think about business strategy, recruiting/talent development, marketing, leadership and management, technology and modernization, and sales. Along with these issues come challenges related to costs, flexibility, resources, branding, and consistency.

Businesses that scale too fast and without the proper infrastructure risk collapsing under the weight of real-world pressures. There’s always the risk of expenses outpacing actual growth, which limits financial flexibility and creates very real problems with debt, accounting, and budgeting. But there are also problems with scaling too slowly. If you refuse to grow, you’ll find yourself lagging behind innovators, and your customers will leave you for a company that offers something better.

The key is to scale with efficiency. If you want to enjoy optimal scalability, you’ll need to leverage outsourcing via the gig economy and automation. Here are a few practical suggestions and ideas for making this happen:

1. Outsource time-intensive tasks where quality matters

Any time your business is scaling and faces a time-intensive task where quality is of supreme importance, you should consider whether you already have the in-house resources to handle it. If you do, is this the best way to utilize your human capital? If you’re honest with yourself, you’ll see that outsourcing is usually the best option in these instances.

Search engine optimization (SEO) and link building are great examples. To boost visibility, traffic, and online sales in today’s internet-based economy, it’s necessary for growing businesses to invest in both. The problem is that these require highly technical skill sets, where quality can mean the difference between generating millions of dollars in revenue and being penalized by Google and getting suppressed in the search rankings.

The good news is that you can outsource tasks like link building to companies such as SEO.co, which offer Content-as-a-Service. You can then reallocate these resources to other aspects of business growth, like social media or customer service.

2. Automate internal processes that aren’t core activities

Automation typically comes into play when you have internal processes that aren’t core activities. For example, let’s say you run a body shop where you fix people’s cars and repair vehicle damage. Your core activities include things like quoting projects, repairing bumpers, and fixing cracked windshields. But there are other activities you have to do to stay in business, like ordering supplies and keeping up with accounting. The best course of action is to find ways to automate these non-core tasks.

Accounting is something that can easily be automated (to an extent) with a simple accounting solution like Due. There are also plenty of automated inventory management and reporting systems that streamline the reordering of parts and supplies.

When it comes to automation, always ask yourself whether the task is critical to your business. If it’s merely a supplementary task, you can automate. This saves time without opening you up to unnecessary risk.

3. Outsource and automate in order to work on your business

There’s a popular maxim that says you should work on your business, not in your business. In other words, the business owner needs to shape, lead, and manage the business, not get caught up in the menial tasks of executing. You can always hire people to do the latter. It’s much more difficult to find someone who can lead your business from the top down.

Any time you find yourself working in your business, you should outsource or automate so you can instead work on your business. You’ll almost always find that there’s a cost-effective option that doesn’t require you to sacrifice quality.

Businesses can’t sit still for too long in today’s marketplace. Stagnation is a death sentence, and it’s imperative that you scale with purpose and efficiency. Thanks to improvements in outsourcing and automation, it’s now possible to scale without fear of losing control. Now’s the time to develop a proactive plan that allows your business to seize opportunities and outpace the competition — your future depends on it.

This article was written by Brad Anderson from ReadWrite and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to legal@newscred.com.

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