One of the biggest challenges entrepreneurs face as their businesses grow is learning to delegate tasks. By delegating what you don’t excel at, and focusing on what you do best, you in turn give your company the best opportunity to grow. But once you’ve made the decision to hire some help, do you go with an employee or a contractor?
Both in-house staff and outsourcing present their own unique benefits and challenges for your company. Read on to discover which one is right for you.
Employees offer the benefits of having a vested interest in your company and its growth. By sticking around longer, they learn the ins and outs of your business and your industry. They form relationships with other employees that help them to better communicate and collaborate on projects. Also, many contractors work remotely, but sometimes you need someone to be physically present to get the job done.
Employees can also present some challenges. You’ll need to take into account benefits, workman’s compensation, Social Security, and healthcare coverage. Your company will need to provide office space, equipment, and other resources, such as training and software licensing. You also may not be able to afford the salary for someone who is as experienced as you might prefer.
Outsourcing is great for giving a boost of expertise, knowledge, and ideas to your company that you might not otherwise have access to. Contractors can offer you fresh insights, especially for research and development projects. They can also provide experience that you might not be able to afford full time, or in specialized areas that your company needs to function, such as accounting, HR, IT, or training. Typically contractors can work with minimal supervision or input from you, and can hit the ground running as soon as you bring them on board. Outsourcing doesn’t require the same resources, such as space and benefits, that bringing on an employee does either, and ending the relationship, if necessary, is easier than firing an employee that has been integrated into your company.
However, outsourcing does present its own share of challenges. While contractors may know their field, they can’t know your company as well as someone from the inside does. They may have their own ways of doing things that don’t work well with your established procedures. A contractor’s success depends on having many clients, so they won’t be as invested in the long-term success of your company as an employee is. Finally, if your company has an exit strategy that focuses on being acquired by a larger organization, employees can make an acquisition more attractive than a company built around contractors.
Who to hire is an important decision for your company’s growth. Consider the benefits and challenges of employees and contractors carefully. You’ll likely find that your company needs a combination of both over its life cycle in order to succeed. Still need help figuring out which one is right for you? Contact Building Bridges for Business today!
