Everyone talks about oursourcing overseas. Here’s my take on what, when, why, where, and how to do it (for a small business):
What: Oursource your programming, your SEO, your Adwords, your repetitive tasks, your email, link building for your site, article writing, content creation, script writing (small automation), graphics, shopping, domain renewals, research, gift buying, …
Basically, anything that you do that someone else could do, outsource it.
When: My experience has been that outsourcing (overseas) is good in 2 circumstances:
- When you know nothing about the thing you’re outsourcing
- When you’re really good at the thing you’re outsourcing
When you know nothing about what you’re outsourcing, then the results won’t be disappointing to you because you couldn’t have done it better yourself. Or, you couldn’t have done it at all yourself so it doesn’t matter how well or poorly it gets done, at least it got done.
A couple of examples of this for me are graphic design and content creation. I have zero graphics skills. I couldn’t design something and make it look good if my life depended on it. I know nothing about it except to say “I like it” or “I think it’s terrible.” In this case, I outsource it every time. Another example is content creation (like articles, copy, reviews). I hate doing it. I’m terrible at writing anything. I don’t care how the writing gets done, as long as it gets done because if it’s up to me to do it, it simply won’t get done.
Both of these are important pieces of my business that I outsource. I know nothing about them.
I suggest you outsource whatever you can that you’re already really good at. For me, this entails link building, adwords, market research, programming, …
I like to outsource these things because I know I can give proper instructions for them and I know it’s going to get done correctly because I can verify it afterwards. I know I can write a spec for a programming project and it will get done how I want it because I understand programming (if you don’t understand programming, you’re going to go through a much more painful process of developing software than I go through).
I know I can outsource link building for my websites because I already understand the methods and concepts and I can accurately describe them to someone else.
I can outsource Adwords to someone because after they’re done setting things up and letting it run for a bit, I know I can go and look at the work and find problems and have them fix them. I can also teach how to do it correctly.
My point isn’t to tell you what I’m good at. It’s to demonstrate that you should and can outsource what you’re good at.
My point is also that you should NOT outsource stuff that you’re mediocre at. If you know a little about adwords, and you outsource it to someone who knows less than you, you can’t very well fix their mistakes or improve upon what they did. The end result is that it gets done more poorly than if you did it yourself. It ends up hurting you and costing you a bunch of money.
If you just know a little about link building, and you hire someone else to do it, and they know less than you, they probably don’t understand that if you build links too quickly it will likely hurt you in the search engines. Then they go out and do a bunch of link spamming and all of a sudden your site is doing worse than it was before because neither you nor the person you hired knew what they were doing.
So, my suggestion for when to outsource is either when you know nothing or when you’re an expert.
If you’re not good at what you’re outsourcing, get good at it (or at least read a good ebook about it). That way you’ll have some guidelines from someone who is an expert instead of just turning it over to someone who knows nothing.
Why: Outsource because it lets you do something else.
Because outsourcing frees your brain to think about other things (just like the GTD philosophy says). Because it free up your time and brain power to work on/think about the things that will make you the most amount of money.
If you know nothing about whatever it is you’re outsourcing, letting someone else do it at least gets it done. For me, there are certain things that I know I should do, but that I hate. Those things never get done. If I outsource it, it gets done. If I didn’t outsource it, my business stops.
If I have something on my todo list that has been there for a long time, I know it’s something I don’t want to do. If I send it overseas, it gets done quickly.
The other reason (besides “it gets done”) is so that you can get good at something else while you’re not doing what you would have otherwise been doing. The more you get good at, the more you can outsource. The more you outsource, the more time you have. The more time you have, the more things you can get good at and more things you can outsource. Then you get to spend time with your family.
We all Most people don’t have enough time in a day to do all the things they know they should be doing. They spend their time bogged down on things that are somewhat important, but that they feel “have” to get done. Things that will make them very little money.
If you outsource those things that “have” to get done, you’ll find out that all of a sudden there’s enough time in every day to get the things done you want to get done. All of a sudden you have time to try out all the cool tools you’ve heard about. You have time to implement new strategies. You have the ability to execute on a new business that you couldn’t have done before, because you were too busy answering support email or setting up adwords campaigns or writing articles. You have the ability to delegate new tasks that you don’t want to do (or hate doing, or aren’t good at doing) and they still get done.
Outsource work so that you can concentrate on the things that make you money.
Where: There are only 2 options that I’m going to talk about:
I’m not even going to talk about India because I don’t know anything about it except that John Bresee once told me that “When someone in India says Yes. to something you said, it means Yes, I heard you say something. not Yes, I understood what you said.” I also know that a friend of mine pays between $15-$30/hour for his programmers in India. If you’re paying that much, why not just hire someone here in the US?
I outsource basically everything to the Philippines.
- They speak good english.
- They’re smart.
- They’re good workers.
- They’re good at following instructions.
- They’re good programmers.
- They’re polite (they call me “sir”, which was a little weird at first…but I got used to it)
- They’re cheaper than in India.
I hire my people through Agents Of Value. Danny (the owner) is a good guy who is willing to work with his customers. He’s done a good job of recruiting and maintaining employees.
Through them you can hire programmers, webmasters, writers, personal assistants, … Basically anyone you could hire here, you can hire there. They’re almost all college graduates.
Depending on your needs, my suggestion is that you hire a webmaster (Remember, I’m writing this to small online business owners). There are a few reasons for this:
- Most people who ask me for help with this want someone technical. (hence the recommendation for a webmaster)
- Once you have a webmaster you can have them do other things for you like write content, create websites, buy/maintain your domains, monitor your email, build links, …
- If you don’t hire a webmaster (someone with some technical knowledge) you’re going to want them to do stuff they have no clue how to do and then you are stuck.
If you do any sort of software development, I would also highly suggest hiring programmers through them. They’re good at recruiting experienced programmers. If you think about the cost of getting a program developed here vs overseas, you’re looking at basically a 5x cost increase. I have a friend here who just paid $5000 for some software development. It took them 10 months to do the work, but that’s only because 9 out of those 10 they weren’t doing anything. If he would have taken my advice to hire someone in the Philippines, he could have paid $5000 for 8 months of development work and could have launched his product 4 months ago, and been way ahead on development. I’ve learned that once a piece of software is started, if you EVER sell it, it will ALWAYS need to be developed. If it doesn’t get developed, it dies. If you pay people here to develop it, you’re going to pay them $75-$100 per hour to continuously develop it (compared to $5-15 per hour overseas).
I have another friend who just got 2 quotes for developing his website:
- Firm based in the US: $10,000
- Firm base in the Philippines: $500
If the firm in the Philippines does it wrong, who cares. Pay them to do it again. If the firm in the US does it wrong, you’re in bad shape.
My initial hesitation to hiring a programmer was that I wouldn’t have enough work to keep a programmer busy full time. I found out after hiring someone that it was pretty easy to keep them busy more than full time.
What I didn’t realize would happen in hiring someone else to do programming for me was that it freed my mind from the binds of programming. Programming is consuming. It’s difficult. If you’re a programmer, and you understand some marketing, letting someone else do the programming for you and you concentrating on the marketing will do wonders for your business.
How: Start small.
Hire someone and have them start doing something for you that you don’t like to do. Even if you don’t use all their time, it’s still worth it to just get started and to have the experience of turning something over to someone else. I have 2 friends who are sharing a webmaster. They share the costs and share the time. It’s a good way to start if you don’t want to make a full commitment with a webmaster/programmer.
For teaching and training, you can give them the ebooks you’ve bought and have them read them. You can create a video of what you do to accomplish the task using camtasia studio or jing, an alternative to camtasia. It’s pretty easy to record a video with instructions and give it to someone and say “do this.” If you have more detailed instructions, spend an hour and record yourself talking about whatever it is you want done. Basement Ventures has a free conference calling system that will let you record the call. If you need to record instructions, call in to your conference call line by yourself and record yourself talking for an hour and send your employee the mp3. Easy instructions.
Teaching someone to do what you do initially seems like a daunting task. However, if the person is overseas and costing you $4/hour, you can let them figure stuff out on their own. Then the next time you won’t have to teach them as much.
After you get comfortable with them doing things for you, give them more to do. At some point you’ll need a way to keep track of what they do for you (agents of value is really good at having them send you a daily report of what they worked on that day). I suggest using Basecamp or RememberTheMilk, an online task management system. RTM allows you to create recurring tasks so you can have them do stuff at certain intervals.
Using Google Spreadsheets is a great way to share information back and forth (like for market research, or for analyzing web stats).
At this point I’ve done a brain dump of what I’ve done to oursource overseas. I’m sure I’ve left a bunch of stuff out and not answered a bunch of questions you have. Feel free to ask me (either comment or email me).
Next time I’ll cover other ways to outsource things (elance, mechanical turk, sitepoint contests) like graphics, small tasks, and article writing.