5 Benefits of Virtual Outsourcing for Entrepreneurs
Virtual outsourcing can be a competitive advantage for small companies and entrepreneurs since it can provide advantages over competitors by providing a lower operating cost and quick scalability as the business requires.
1- Buy specialized work by the hour
When starting up a company or managing a small business typically the budget is tight and the number of employees is small. Having a small payroll maybe be good for the company finances but it does not provide access to specialized work that might actually help the business grow such as: getting a web site or updating the current one, social media marketing, lead search, etc.
Having access to specialized work and being able to pay only the amount of hours that are used can be a great tool. Ten years ago companies would have to grow to the size in which they could create a full time job for each of the specialized workers needed to grow the business even further. This is not true anymore thanks to virtual outsourcing.
2- Get access to specialized/knowledge work at a fraction of the cost.
Imagine being able to pay for a few hours of a designer, a few hours from a software specialist and only a few hours from a marketing professional to get an awesome web design and manage your social media presence with a clear strategy and weekly reports. Sounds like the type of result only large companies can get right? Well, with virtual outsourcing entrepreneurs can have access to this same set of skills at a fraction of the price due to two reason:
1) work is purchased by the hour
2) outsourcing to lower cost locations provides a cost advantage.
These capabilities help level the ground for smaller businesses that traditional had to compete with larger firms with a larger access to resources.
3- Delegate activities that consume your time and dilute your energy.
Virtual outsourcing can allow you to reduce the weekly to-do list to those activities where you can create more value for your business.
Many entrepreneurs fall in the trap of trying to do everything themselves. The result of this is feeling overwhelmed, missing deadlines, and working on urgent stuff while leaving the important things for latter. Having the option to delegate tasks that are administrative in nature or that you simply dislike doing, can free up significant amounts of time to focus on developing that new product or project that you have been postponing due to lack of time.
The advantage of virtual outsourcing is that delegation can occur easily and seamlessly through multiple communication channels at a fraction of the cost of hiring a full-time employee would cost.
4- Automate your business processes.
Imagine setting up your new marketing campaign digitally, launching it, tracking results in a single platform, having someone else monitor it daily, having your CRM updated, construct and follow through leads until you get to those leads that add more value so you can jump in to contact only those leads that are really worth it while some else is answering all your customer care calls?
This is now a possibility available to small business also. Tim Ferris with his famous book “The four hour work week” made famous the concept of virtual outsourcing. In his book he clearly explains how he delegated and automated his business processes through virtual outsourcing, so he jumped in only when it was absolutely necessary. This is not a case study any more, this is a reality that many small businesses and entrepreneurs are taking advantage of given the large offer of virtual work and cloud software that is available at a fraction of the cost you could get it ten years ago.
5- Obtain flexibility to scale or downsize quickly.
Some businesses might have a strong seasonality (typically retail) or might also go through cycles (fashion). Having the flexibility to scale up and scale down quickly at no cost can be a great advantage for long term survival.
Virtual work is typically managed on a month to month basis or on a project basis. Once the project is finished the services are cancelled and costs go down quickly. On the other hand when a large project comes up, it’s much quicker to access a team of qualified virtual workers than posting 3 temp job offers, having to screen through all of the candidates, provide office space, insurance, having to deal with sick days, etc.
Through virtual outsourcing you can quickly obtain a designer in the US a software programmer in India and a project manager in Canada, provide them timeline and deliverables for your project and let the team work together to complete your project. Once the timeline and deliverables are met, payment is made compared to having a fixed employee in your office.
Leveling the ground.
Virtual outsourcing or online outsourcing has levelled the ground for many small companies in the last 10 years. The virtual industry has had a strong growth over the past decade and will continue to grow at least during the next 20 years or until computers are able to perform knowledge work (Although artificial intelligence has developed significantly there is still no replacement for humans on many specialized work fields, at least today).
It was reported by a study from the World Bank that the global market for online workers grew 33% during 2013 which grossed around $1.9 billion. Estimates also made by the World Bank show an estimated market size of $14 billion by 2020.
While AI continues to develop smaller firms that have access to virtual work will definitely have an advantage in cost and scalability over those that do not take advantage of it.
 “The global opportunity in online outsourcing”, World Bank, June 2015