Hiring vs. Outsourcing: What's On Your Mind?
Psst. Your business is growing. Look at you doing big things! Well played! It might be expanding for long-term growth, or you have short-term projects requiring more hands on deck. Either way, you’ve got to do some recruiting. And that means you’ve got to make some firm decisions that affect your bottom line and your ability to meet your client’s needs effectively, i.e., hiring vs. outsourcing.
According to a survey by the Society for Human Resource Management (SHRM), the average cost per hire for companies in the USA was $4,129 in 2020. The average recruitment costs in Latin American countries range from 15- 30% of an employee's annual salary for middle- and high-level positions. That can represent a sweet chunk of change, depending on the size of your business and your current expenses.
But don’t get too focused on cost just yet. Try not to get caught in some of the easiest decision-making traps out there:
(i) a tendency to let cost-saving in the immediate term make your decision for you, and
(ii) the “availability bias,” where you rely on immediate examples or information that come to mind easily with a bit of an unconscious blinkered view.
Let’s think things through, not just for now, but for your long-term business success. Here are seven (7) key considerations when deciding on hiring vs. outsourcing.
1. How much do you know about your recruitment needs?
Do you have the expertise, time, and resources to do your hiring needs analysis? If you’ve got a good grasp of HR including knowledge of sourcing, screening, and evaluating candidates, then you might consider doing your hiring in-house. But you also need to determine if you have the necessary skills, time and capacity to handle the recruitment process efficiently. Recruitment agencies have expertise in finding and vetting candidates, allowing you to leverage their resources and networks.
2. How much can you afford to spend on hiring?
Yes, cost-efficiency is still really important! If you’re doing recruitment yourself, factor in costs such as advertising, screening, and onboarding, plus the salaries of your HR personnel. Evaluate whether these costs are justifiable for the type of positions you’re looking to fill. For more junior-level staffing needs, or short-term projects, in-house hiring might prove more viable. But for mid to high-level positions in a medium-sized organisation, you might actually save money by going outside. Recruitment agencies charge fees or commissions, but they can provide cost savings in terms of time and effort spent on recruitment activities.
3. How much time do you have?
In tandem with cost, think about any time constraints on getting all hands on deck. Do you need new hires or short-term employees urgently, for example, for a product launch or a brief sales peak season? Outsourcing may be the better option if you want a reliable recruitment process that can quickly tap into its candidate pool and networks.
4. Do you know where your ideal candidates are and how to attract them?
This is an important consideration about access to your ideal candidates. Knowing who fits the profile of your potential new hires is one thing; but knowing how to get them to apply to you is another.
What kind of candidate pool is easily available to you if you decide to hire in-house? If your web and social media presence are popping, or you maintain key networking links within your sector, you can attract potential applicants easily.
Take a look at your LinkedIn profile or Facebook groups and the current employment rates in your sector for a gauge as to who you are attracting and whether they fit your needs. If, however, you deem that you want access to larger talent pools or specialized networks, you might want to consider a recruitment agency to help increase the likelihood of finding the best fit for your organisation.
5. How familiar are you with recruitment regulatory and legal requirements?
Remember that availability bias? The tendency to overlook compliance and legal considerations could sneak up on you here, especially if you haven’t conducted hiring practices in recent times. Labour laws and regulations regarding diversity, non-resident hires, contract management, payroll, and taxation could be applicable to your recruitment process. If legal compliance is a concern or if you lack expertise in this area, outsourcing recruitment can provide peace of mind.
6. Do you need to keep information close?
Depending on the nature of your business or sector, some of your information may be sensitive, or proprietary, and confidentiality or non-disclosure may be critical for the project. Aside from sensitive info, you might value the ability to fully represent your company culture, brand identity, mission, and vision to potential new hires from the very start of the hiring process. If that’s the case, you may prefer to have more control over the recruitment process by keeping it in-house. This allows you to ensure that candidates are aware of and adhere to confidentiality agreements.
7. What are your long-term goals?
Think about your business strategy and goals. Building an internal recruitment team for talent acquisition and inculcating a strong organisational culture may benefit your overall growth plans and ROI. However, if your long-term focus is on core business activities, you can opt to outsource the recruitment function to an agency.
Carefully considering these factors will help you determine whether hiring vs. outsourcing is the most suitable approach for getting the best fit for your growing team. It's essential to align your decision with your organization's resources, expertise, project requirements, and overall strategic objectives.
Hiring vs. outsourcing: The verdict
So what should you do?
Depending on the circumstance, outsourcing your hiring needs may be best.
If you're looking for a large group of seasonal workers or a broad skillset, you can find a company with the resources to provide that talent.
If you're looking for a long-term hire with specific traits, you may want to keep it in-house. CallServ is not only one of the leading outsourced call centers in the Caribbean. We've developed a large, robust database of candidates for Customer Support, Sales, Data Entry, and Lead Generation staff. Our recruitment and selection service helps businesses in the Caribbean find fantastic talent for seasonal or long-term employment.
Let CallServ help you scale your business without the costs that come with finding and retaining top talent. Contact us for your hiring needs in the Caribbean today.
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