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Outsourcing Do’s and Don’ts – Business Times

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Foreign policy Expert and Entrepreneur Alexander Djerassi emphasizes Outsourcing Wisely

Alexander Djerassi is an expert on foreign policy. He has served as a diplomat and has traveled on diplomatic missions to North Africa, the Middle East and Europe. He currently runs a civic-technology company called Mos.com that helps students get scholarships and grants. He supports companies that outsource work but advises them to outsource work carefully.

Core Competency

A company should not outsource its core competency. The main idea of outsourcing tasks is to help the company focus on its core competency and leave non-essential tasks to companies that are experts in these functions. Business processes like IT, article writing, SEO or graphic design can be outsourced to experts so that the company can stay focused on its primary tasks.

Important Tasks

Good entrepreneurial leadership focuses on keeping employees motivated and happy. Making sure that onsite employees are doing all the important tasks of a company will improve employee motivation and contentment. Entrepreneurs should explain to employees that they are the backbone of the company and they are entitled to job security and benefits unlike independent contractors who are hired to reduce overhead costs for performing minor business processes.

Legal

Entrepreneurs should study all legal risks before outsourcing tasks and if required ask the outsource contractor to sign a non-compete or non-disclosure agreement. Entrepreneurs should clearly classify outsource contract workers as contractors and not employees. Entrepreneurs classifying outsource contractors as employees are liable to give them benefits. The IRS penalizes employers who wrongly classify freelance or independent contractors as employees.

Clear Communication

Independent contractors will not function like robots. They need to understand exactly what the entrepreneur wants them to do. Employers should clearly communicate their expectations to get the best available services from independent contractors. Outsourcing involves getting minor tasks performed so that the wheels of the core competency of a company move smoothly. The independent contractor should act as a tool that assists the partner company to succeed.

Control

When a company outsources business processes to another, it should make sure that there is a manager to direct operation. If the company has to control and manage the independent contractor, it cannot focus on its core competency. The company should carefully choose an independent contractor. The independent contractor should function independently. The entrepreneur can tell the contractor if there are any changes required but the independent contractor should perform tasks without the need for continuous management and control.

Costs

Outsourcing is a cost-effective way of getting business processes performed by an independent contractor. The independent contractor should work as if it is one of the departments of a company. When a company is satisfied with the independent contractor’s business process performance, the company will give better customer service and improve the quality of life of its skilled permanent employees. Alexander Djerassi is a successful entrepreneur and a recognized expert in international business. He provides valuable advice on why a company should outsource its routine business processes to experts. He also advises companies on how they should outsource business processes carefully and wisely.

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