Comstock's magazine 0119 - January 2019 - Page 67

SPECIAL PROMOTIONAL SECTION risk, though, is losing some degree of con- trol over the service or product that’s been outsourced. Insourcing lets management main- tain authority over the internal aspects of its business, and can help foster corporate culture by adding a leader with the right atti- tude, one who fosters and rewards employ- ee involvement. Taking internal ownership of a task or project can be leveraged by top management to increase communication and improve employee morale, says Carolyn Lewis, CEO and founder of the Lewis Group. On the other hand, it requires compa- nies to develop more skills and efficacy in support roles and can distract from the core business, each of which can be costly. “Both options have equal but different types of risk,” Mandelberg says. “Is your ability to handle a problem [in each mod- el] strong enough that if something goes wrong, you’ll be less harmed by it?” How to know which way to go? Often, choosing one tactic over the other is not the answer. Sometimes the best option is a combination of the two. The owners of four Sacramento-based multi-service business- consulting firms weighed in to determine how to navigate these complex decisions. “When bringing the work in-house, [it’s essential] to find a person to oversee it who has the skills and fits within the company culture,” says Jeanne Reaves, president and CEO of Jeanne Reaves Consulting. “I have clients who will not hire a key position until they’ve done a profile and know the candi- date has the personality to do the job.” Certain questions need to be answered before the search for new talent begins, she notes. What is the company’s core busi- ness? What is the complexity of the depart- ment to be formed? Mandelberg says it’s “time to create something internally when you have suffi- cient complexity requiring hands-on man- agement and a level of intimacy with the operations of the organization. Then you have to decide what the load will be on that expertise.” The issue of going in-house versus con- tracting out should start with a cost-benefit analysis, Lewis says: “That said, one key in- dicator of when you want to have a CFO is your strategic plan for the next three years. If a small company is planning to double or triple in size, it can get there faster and more cost-effectively if it has the expertise at the senior level. Then, when it gets to the point where it has the product and market, human resources should be inside to drive that pro- cess.” Marketing expert Debi Hammond calls a company’s brand “its greatest asset.” She’s the founder and CEO of Merlot Mar- keting, a national PR-marketing agency. “When is it right to hire a head of market- ing?” she says. “Whether you’re a startup or a multibillion-dollar company, someone should always be dedicated to that role, re- gardless of title.” On the other hand, if a project or goal doesn’t warrant the time and expense of establishing an in-house department or po- sition, outsourcing can be an expeditious and outsourcing,” Hammond says. “For an outside resource to be successful, it needs in-house support or liaison. And the larger the company gets, the greater the need for both an internal and external team.” One common error is “hiring one or two people who are really good at a key disci- pline and expect them to perform exceed- ingly well at every discipline,” Hammond points out. “For experts in multiple catego- ries, most companies hire an outside firm because it makes more sense strategically and financially.” What should a company look for in an outsource partner? “Find someone who has done what you need to be done for people you need to have it done for,” Mandelberg says. “Trust but “WHEN BRINGING THE WORK IN-HOUSE, [IT’S ESSENTIAL] TO FIND A PERSON TO OVERSEE IT WHO HAS THE SKILLS AND FITS WITHIN THE COMPANY CULTURE. I HAVE CLIENTS WHO WILL NOT HIRE A KEY POSITION UNTIL THEY’VE DONE A PROFILE AND KNOW THE CANDIDATE HAS THE PERSONALITY TO DO THE JOB.” - Jeanne Reaves, president and CEO, Jeanne Reaves Consulting solution to finding much-needed expertise. Also, it can declutter a company’s day-to- day workload and allow it to focus on core business. For instance, more companies are outsourcing payroll and IT. “Short-term outsourcing helps a com- pany get to a certain level or meet a strate- gic goal, and then they often bring it inside,” Lewis says. “What happens, in reality, is that it’s convenient to pay the extra money to keep outsourcing, and you reduce your risk of making mistakes.” Reaves acknowledges there are some situations in which outsourcing is more costly than insourcing, but exceptions are not rules. “Cost is not the only factor to consider,” she says. “Let’s say you’re paying more dol- lars to an attorney than if you brought one in-house. It may still be wise to outsource because of the support attorneys have with- in their given firms.” “The most successful companies usu- ally have a combination of both in-house verify, and go out of your way to find some proof of concept. Making a mistake is too costly not to.” It’s generally agreed that it’s wise to confer with a consultant before making the in-house vs. outsource decision, ideally, a person who understands your business and its culture. “Consultants are typically approached by referrals, reputation, social media and requests for proposals,” Reaves says. “They are used for team-communication training, strategic planning and other leadership de- velopment. “The client and the consultant must feel good about the project being request- ed, and the people involved,” she adds. “If the communication isn’t great, then the job will fail.” n Allen Pierleoni is a freelance writer in Sacra- mento. He worked for The Sacramento Bee as a writer and editor in the features department for 30 years. January 2019 | 67