By John Dyke
Not sure whether to hire in-house staff or work with freelancers? This article should help make the decision much simpler for you.
Once you’ve decided to expand your business by investing in talent, the next step is to figure out whether you tap into the outsource or freelance workforce, or whether you hire staff in an ongoing, in-house position.
There can be greater flexibility with outsourcing, especially if you have a more intermittent need for staffing. You’re not committing to a full-time role if your budget doesn’t allow, and you can tap into expertise, which might not be your strong suit. It can also save you time in the hiring process, which can be time-consuming (and therefore costly).
Hiring in-house staff can be advantageous when it comes to the quality and consistency of work, as you’ve more control over the work outputted and more input with the training and standards of your workers. Also, the time you invest in training staff stays within the business, especially when you can offer your team additional benefits, like flexible work environments and leave entitlements.
So if both options have their advantages, deciding on which method to go with can feel overwhelming. But, the process of weighing up your options is surprisingly simple, as it hinges on what you know best: your business.
Here are three questions you need to ask yourself to figure out which option will work for you.
1.What role are you hiring for?
Your first task is to firm up and define the role you are looking to hire. The easiest way to do this is by completing a skills matrix to figure out what skills your business is lacking and how this role could accommodate them.
For example, if business administration and figures are not your strong skill set, you could combine an office manager role with bookkeeping.
If you need a stand-alone task completed on an ad hoc basis or if the functions fall outside your area of expertise, like say paid advertising or marketing, then outsourcing to an expert is probably the best way to go.
So define the skills you need to grow your business, figure out where your strengths lie, and the choice between outsourcing and hiring becomes much clearer.
2. Will outsourcing cost more in the long run?
One of the biggest drawcards for going down the outsourcing path is cost saving.
You are not committed to ongoing wages and the other costs associated with permanent employees, like super, payroll tax etc. You can capitalise on a remote workforce, so you don’t have to invest in office space, and you don’t need to invest in HR resources or ongoing staff training and reviews.
But there is generally a higher rate to be paid for outsourced roles.
To get a clear picture, it’s imperative to be on top of your current and projected earnings so you can analyse not only the long-term benefits of both options but also the impact it will have on your cash flow.
You also need to think outside the ‘money’ box when it comes to costing’s and put a price on your own time.
Outsourcing can free up your time as a small business owner, which means you get to focus on growing your business, rather than merely operating it, which will benefit your business in the long run. But regular wage commitments can also be a bonus when managing your cash flow and can also be beneficial when setting goals and targets for things like business development.
The key here is to know and understand your numbers, so you can make an informed decision, based on what is best for your business long-term.
3. How much training does the role require?
Outsourcing a role in your small business will undoubtedly mean more time for you and your tasks, but it can still be a time-consuming process initially as you get the freelance operator up to speed with your brand and required tasks, so they understand the standards of work you expect.
Creating company policies and procedures, so you can ensure the work completed by the outsourced person meets your business standards and brand is vital.
It’s important to note when it comes to outsourcing, you still need a lot of strict conditions in place – possibly more so than with an internal hire.
You’ll need a contract stipulating what work you require as well as clearly stating the point of completion.
Make sure the tasks in the contract reflect your skills matrix and what your business needs from that person.
In addition to your contract, or job description, you should take the time to create policy and procedure documents, so that someone can easily understand what your business’s core purpose is. Even your contractors have to reflect your brand, so they need to know where you’re coming from and why you do what you do.
If the role needs additional training to ensure compliant work, then perhaps you might be better off hiring in-house to preserve that knowledge.
It’s important to accurately gauge how much time it will take to not only train for the role but also to set up procedures and policies, so people understand your business and your exact requirements.
Deciding which staffing solution is right for your business depends on understanding your current situation, knowing where your business is heading, and having clear objectives and outcomes documented.
This feature was originally published on MYOB here: https://www.myob.com/au/blog/hiring-choices-freelance-full-time/