Changing Face of Work Means Outsourcing may be the Future for Most Businesses
Outsourcing - hiring a freelance partner to provide a specific project delivery or service for your company - could help your business... writes Lora O'Brien for the Sunday Independent
In 2011, just 25pc of business was outsourced. That's risen to 31pc this year, and will continue to grow - up to 40pc of the global workforce will be outsourced freelance workers and consultants, according to the 2015 Hiring and Working Trends report by Expert360.
Though the outsourcing trend is definitely upward, there are certain potential pitfalls that should be taken into consideration before you decide it's right for your business.
You're giving an outside individual or company access to your business data, anything from accounts to customer mailing lists, so security and confidentiality should be written into the contract agreement you enter into.
Terms and specific responsibilities will have to be carefully thought through to ensure that there's no hidden costs cropping up mid project or contract that you hadn't thought to negotiate for. And there's the issue of quality control and company ethos - though a good freelancer will work hard to make sure they capture and deliver your company's standard, or better, it's important to look at their portfolio and previous client testimonials to ensure you're signing up with a good freelancer in the first place.
Derrick Bell, whose Wicklow-based company Toby Wagons operates primarily through outsourced labour, is frank about the downsides to freelance hiring.
"Some freelancers require you to enter a contract, so you do have a certain gamble to take to ensure you get ROI (Return On Investment), and one recent hire has been slow to deliver so it might be time to look elsewhere. Other than that I feel the positives outweigh the negatives.
"I have an external company who hold my stock and then send it directly to customers. I do not get involved with any of this. I also outsource a web developer to do work on my websites as this is technical.
"I also outsource some work like SEO and advertising. I am proficient in both, but it's good to get a specialist who can add their depth of knowledge. I also use quick outsourcing methods like (the freelancers website) Fiverr.com to help with lots of small things, and even just to review my sites regularly to see if there is any improvements I could make."
So what are some of the benefits he found?
"I might only need a couple of hours here and there on certain projects and outsourcing allows me to avail of specialist services without the need to hire anyone and pay PRSI, training, office costs. With the main part of my business outsourced I could effectively run my business from a beach, which I suppose is the dream."
The Expert360 report estimates that as much as 76pc of businesses surveyed are experiencing a skills gap. This can be dealt with very effectively by outsourcing particular projects or services without the long-term costs or hassle of a traditional hire, while on-site outsourcing will bring that expertise to your existing employees, who can work side-by-side with the freelancer to acquire a whole new skill set - if that demonstration or training is made part of your contract agreement.
Ciaran Curran is a business systems analyst who works on contract to companies such as Coillte, with his Kildare based business ILGRIN Consulting.
He faces the challenge of learning a new industry with each contract, as he moves between a lot of different industries from the government sector, semi-state and private sector - all of which have different ways of doing things and different challenges.
He notes that contracting staff are not eligible for benefits which are offered to permanent staff, like holiday pay, sick pay, health insurance, pension contributions or bonuses, while there are also significant bottom line cost savings for his clients' payroll with outsourced contracts as there is no need to calculate PAYE, PRSI, or USC.
As the cost of a contractor is fixed for a project, this enables the contractor cost be included in the overall project costing and comes out of the project budget.
Of course pros to the hiring company can be cons for the freelancer.
"As a self-employed contractor you don't have the luxury of paid holidays or sick leave so it can be very challenging to find the time to take proper holidays; excluding bank holidays I have only taken 10 days vacation in the past two years.
"In Ireland the tax system penalises people who work for themselves both with additional USC rates and no social welfare supports for when self-employed people are not working.
"Since a significant amount of work moved to contracting during the Celtic tiger years a lot of the workforce are now effectively self-employed and bear all the risk themselves, often working without any savings or health insurance."
Tina Mulhearne is the Tipperary-based owner of HR Direct, an outsourced human resource solution for micro and SME companies in Ireland. As a self-employed business owner, Tina herself outsourced specific skills she doesn't have - such as accounting and IT support - and she values the independent opinion and expert advice she has to hand as and when she needs it.
As it's estimated that a skilled professional like Tina can earn up to 275pc more as a freelancer, it makes sense to explore this option from both sides of the equation.
Common freelance services include customer services, PR and social media management, accounting, IT in both hardware and software systems or support, human resources set up or management, business data management, and copywriting on everything from white papers and reports to marketing brochures and content creation for company blogs or newsletters.
If you need it done, and you don't have the skills or time to do it internally, there's a professional freelancer waiting to do it for you.
We created a Landing Page and incentive package (join our mailing list and get this cool free stuff!) for an Irish handcrafts business.
Designed to attract their exact target audience, and bring them into the sales funnel with free relevant content, this landing page performed at 12% above the average conversion rate. We continued to work with the business for their blog and mailing list newsletters, keeping the content rolling and the customers interested and engaged.
And spending money of course, which is the most important thing.
Our service was recommended to Eamonn in 2014 when he needed some professional support to craft a marketing profile to go with his stunning visual creations.
We chatted with Eamonn about his history and achievements, and wrote this for him:
Us Irish are known for our creative talent. Let’s face it like, Ireland is fairly dripping with young upcoming talent, not to mention the already established world renowned artists and designers. But every so often, amid this pool brimming over with artistic merit, a new star shines even brighter.
Eamonn McGill is the newest such star, firmly on the rise in the world of fashion design. Now aged just 22, and completing his final year at the National College of Art and Design, his fashion accomplishments over the last two years have been nothing short of astonishing.
While studying textiles at NCAD, Eamonn interned for Irish fashion stylist and presenter Courtney Smith. He fell in love with fashion design - knowing then, even at the tender age of 20, that this is what he wants to do for the rest of his life.
So his fashion design business was born when he was just 21, and what he didn’t have in age or experience he certainly made up for in passion and talent!
Despite being the only non fashion design student entered, McGill placed Runner-Up in the DCU Young Designer of the Year Award 2012. He was chosen to style the winners in the Peter Mark Hair Show at The Wella Professionals Trend Vision Award UK & Ireland, in 2012 and again in 2013. And he was picked for the creative team working on the Ryanair Calendar in 2014.
His unique designs are now reaching an international audience on stage and screen. Australian model and music sensation Iggy Azalea wore a McGill original on her latest world-wide tour, and liked the outfit so much that she spoke about it to the press.
And his creations are far from ignored by the Irish glitterati - McGill is the only college student and young designer to have the honour of dressing no less than three celebrities on the red carpets of the recent IFTAs and VIP Style Awards, with all of his work featuring strongly in the tabloid and media coverage which ensued.
McGill has been snapped up as Head Buyer for a new Grafton Street Boutique, so you can get your hands on his fashion taste and style there when it opens for business in a couple of weeks.
Keep your eyes on this upcoming young, talented Irish designer. You can catch him on Social Media where he loves to hang out - at Eamonn McGill Style and Design on Facebook, and on Twitter.