Outsourcing expertise can significantly boost companies. Whether you’re a new, smaller business looking to grow or a bigger company that needs specialized expertise, outsourcing can be a powerful tool in your company’s kit. However, there's a lot of nuance to outsourcing — you have to design a financial strategy that takes an outsourced team’s strengths, weaknesses, and objectives into account. By doing so, you can grow a profitable and sustainable business.
Michelle Hirons is the founder of HigherRing, a certified B corporation that provides savvy U.S.-based outsourced operational support to companies needing expert human resources. Its mission is to be a catalyst for a more sustainable business world. Based on Michelle's CEO journey, here are some insights on growing a profitable and sustainable business through outsourcing.
Incorporating B Corp Certification Values within Your Team
Being a certified B corporation requires taking a long-term perspective instead of a short-term focus on profit. As Michelle puts it, “It's balancing all of those things for a good long-term vision that helps with not only growth but also how we can be helpful in changing things for the better.”
Along with this, below are some B corp certification value-based strategies that can increase your team’s impact:
Set stable and reasonable schedules that mesh well into your employees' lives.
Pay a living wage that is above the minimum wage. Then, increase it as employees gain experience.
It’s ok to grow slowly as a company as long as you grow continuously.
Incorporate an employee stock option program.
Partner with financial coaching businesses and financial wellness programs.
Provide 0% loans to employees to help them work their way out of debt.
Michelle says,
“We want to do that so that everybody feels really a part of our mission, and that we see alignment across all of our teams and that we are all moving in the same direction as hard as we can and as smart as we can.”
How to Manage a Virtual Team Effectively
1. Weekly Divisional Team Meetings
It is critical to conduct divisional team meetings weekly so that everyone involved stays aligned and on the same page. HigherRing conducts these meetings using a standup style, where each team has the opportunity to talk about their plans and progress.
It’s also a chance to seek support and address challenges and difficulties with the client before facing them.
2. Conduct Team Activities
Team activities are a way for people to engage and get to know each other. They don't need to be complex activities; they can be as simple as posting fun questions that everyone can answer using online platforms like Slack. It can also be a way of encouraging the team to share their hobbies.
Under this, you can also do virtual team-building opportunities. Here, you can talk about how you’re doing as a company in an innovative way that brings people together.
3. Stay in Touch
Make it a priority to stay in touch with people. Michelle says that they figured this out the hard way.
Know everyone's difficulties and goals for the future. It can help you plan the company's trajectory for the better, i.e., the client you're bringing and how employees will grow with you.
Walking Clients Through Outsourcing
Usually, clients reach out to outsourcing companies because they are already interested and need it. The typical reasons for outsourcing are not wanting to manage certain types of work or to delegate specific tasks to experts.
Some of these tasks are usually but not limited to:
Operations tasks
Customer service
Technical support
Below are some tips on how clients can know if outsourcing is right for them:
1. Emotionally Intelligent Language
Use emotionally intelligent language to efficiently identify how to solve clients' problems and how they can get the best out of it.
Believe in efficient, effective, and empathetic customer service than merely giving a white glove customer service. The latter focuses solely on solving problems without taking maximizing the use of their expertise and positively impacting other business areas.
2. Is Outsourcing Right for Them?
Clients should determine whether their outsources have more expertise in an area than they are. Only then would it make sense to hand that work over so they can spend time developing other business areas.
3. On the Cost of Outsourcing
Outsourcing employees comes with a small management fee. However, the total expense is the same for clients trying to hire in costlier metro areas, even with this additional cost.
4. Easier Hiring Process
Another advantage of outsourcing is that the people they will be hiring are fully taken care of from an employment relationship. Since founders are busy, outsourcing means somebody else will be responsible for the hiring and management process of the outsourced roles.
5. Can They Afford the Skill Set They Need?
Finally, clients must know how much they need to pay for the skill set they require. Effective outsourcing is asking whether it is better to hire a fractional person for the time being or to opt for other employment approaches. Either way, outsourcing can be beneficial.
How to Help Clients Manage a Virtual Team Effectively
Helping clients manage a virtual team is mostly the same as managing your own — back and forth communication. It’s a must to stay aligned with the client’s goals and priorities.
It’s critical to communicate with the clients and get frequent, regular updates. As Michelle puts it,
“So the client has an opportunity to tell us what's going on over there: are there any big changes, anything that we need to know to stay aligned? And then on our side, we go through what we did last week, what we're doing this week, and any challenges that we need help with in order to move forward effectively.”
Hiring Roles for a Growing Business
The mission of outsourcing businesses is to create great and sustainable jobs. And so, from a client's perspective, they are hiring team members that have received expert training and mentoring for their roles.
Charging a placement fee can allow clients to try out an employee and see the value they can bring to the company. Michelle explains it in this way:
"As companies grow, and they need our people, and we move them into full-time positions, it's been a real area that a lot of our founders have been interested in doing. They liked the opportunity to not take on the heavy lifting at first and see how it goes. And then as they grow, they're able to bring people on, put them on their cap tables, and treat them as internal members of their companies."
Strategies for Outsourcing Pricing
Here are some strategies for pricing outsourcing services:
Look at your competitors.
Learn what works for your specific business.
Have pricing conversations within peer groups.
Get expert advice, like from a fractional CFO with expertise in financial strategy.
Michelle’s final advice on pricing is,
“Like outsourcing, if there's something that I don't know how to do very well or that I can learn from somebody else who specializes in it, then I totally want to take advantage of that.”
The best time to hire and partner with a fractional CFO to help with the company's trajectory is not when they're just getting started. You need a business plan that you believe in first. Only then can you take your experience and benefit from a fractional CFO's expertise.
Different Outsourcing Models
Full-time support: The people in this team have a general scope of experience working directly with one company.
Fractional team: This is best for small company founders who can’t afford the expertise they need in various operational supports.
Full-on team: This setup supplements the clients’ team or takes over for an entire team, typically for a season.
Learn more about Michelle and HigherRing. Get to know why they are doing what they are doing on their website. Reach out to Michelle via LinkedIn.
If you want to know if your pricing is correct and whether it can lead to your growth, a CFO can help you figure out your next best move. Understand what fair yet competitive pricing entails and how it plays a critical role in your business with the help of a finance team. Schedule a discovery call with Profit Reimagined™ to help you cover your foundations and deepen your understanding of these concepts.