Outsourcing functions to specialized experts is gaining traction in today’s business landscape. Scaled organizations regularly outsource functions such as legal, accounting, and IT. While having a few subject matter experts (SMEs) on the team always brings benefits, there are major advantages to outsourcing certain roles and project management is no exception.
Let’s face it: outsourcing can be a sensitive subject. The negative connotation associated with outsourcing arises from perceived workforce reduction and loss of control. Many employees worry about their jobs being outsourced to external entities. However, in reality, outsourcing is often used to supplement current employees in an organization, allowing them to focus more on core competencies. Additionally, organizations may fear losing control of the particular function through outsourcing. While some control must be relinquished, a successful outsourcing partner focuses on establishing effective communication and collaboration, ensuring that the organization is up to date and comfortable with all actions that are taken.
Despite the sometimes-negative connotation, outsourcing certain functions offers substantial benefits. Let’s dive into why organizations outsource, specifically in the context of project management.
Access to a bench of subject matter experts
When you choose to outsource a function like project management, your organization gains access to not only one employee (as would be the case when hiring an internal project manager), but to an entire team of experts dedicated to the function. For example, when partnering with MustardSeed, a project is assigned to a lead project manager; however, that project manager is supported by an entire team of experts with diverse experience across multiple industries and disciplines. In short, outsourcing allows your organization to harness the knowledge and experience of an entire group rather than relying on a single internal hire.
Outsourcing brings a higher return on investment
Hiring full-time or part-time internal employees can carry a hefty price tag, especially if the candidate possesses adequate and extensive experience. Hiring managers and leaders often face the dilemma of whether to pay more for higher experience or settle for a more cost-effective, but less tenured, candidate. Outsourcing prevents hiring teams from having to make this decision and reduces costs by eliminating the expenses associated with sourcing, hiring, and training a new candidate, not to mention the cost to provide an internal employee benefits and compensation. With outsourcing, the business only pays for the actual work that is being completed.
Outsourcing allows tangible results to be linked to business spending
Rather than calculating your burden rate and managing it, outsourcing project management allows you to use expenditures differently. With outsourcing, key performance indicators (KPIs) are associated directly with the project spending, and real, quantifiable results are attached to the project. You should never struggle to answer the question of what value is being brought to your organization. For example, MustardSeed establishes KPIs early in the project and initiates regular communication with business and project leaders. Outsourced project managers are experts in dashboards, which provide valuable real-time insights into project metrics.
Outsourcing limits and prevents bias within project management
Bias is often challenging to identify and address. Many leaders mistakenly believe that no bias exists on their team, and project management practices are not immune to bias. Bias can be experienced on a project team when outcomes are too optimistic or when team cognitive bias affects how the Project Management Office (PMO) makes decisions about its practices. An outsourced project manager often acts as a neutral part of the project team. During my experiences as a consultant, I have approached tough project questions with a fact-based approach and guided teams towards solutions that work not only today, but in the long-term as well. By partnering with a project management office and outsourcing the function, you gain access to experts who can help navigate project risks and guide strategic business decisions.
In conclusion, outsourcing should not be considered a last resort for businesses. Instead, it should be a high contender for how your organization plans to execute the function of project management.