Why NFPs should consider outsourcing
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Outsourcing refers to contracting the skills of a company to fulfil an organisation’s needs and allows them to take advantage of experts that they do not have, or cannot afford, internally. This may include marketing, graphic design, organising conferences and events, secretariat services, publishing, marketing or finance.
Outsourcing is a cost-effective way for not-for-profit (NFP) organisations to achieve their organisation’s goals and keep within their budget.
Findings from The Outsourcing Institute’s most recent study, which surveyed 1,410 members, found that reducing and controlling costs is the most common reason organisations choose to outsource.
With a limited budget NFPs often can’t afford five or more employees to fulfil their organisation’s marketing, graphic design, editorial, secretariat and event needs; and it’s difficult to find one person with skills in all of these areas. However, outsourcing allows NFPs to draw on the skills of specialist departments with differing areas of expertise for often less than the cost of hiring one internal employee. Depending on a NFPs needs outsourcing can be the equivalent of employing ten specialists for less than the price of one.
Not only is outsourcing more cost effective than hiring staff internally, it can also result in a great level of efficiency. With access to teams of experts in a range of fields, organisations can enjoy a more professional standard of work, which can improve efficiency, the image and reputation of the organisation, and increase member/donor support.
CEO of The Institute of Hospital Engineers Australia Greg Bondar outsources their member magazine to Third Sector Services. He says “I am of the view that specialisation is the key to productivity and effective cost management, hence why do what others do better?”
The Australian Counselling Association (ACA) CEO Philip Armstrong also outsources their magazine to Third Sector Services and says “The journal in its ten year history had reached its optimum in relation to delivering a peer reviewed journal to members that was produced internally by the association. To go to the next level and compete internationally in design, content and layout with other similar journals it needed the expertise of professional publishers as this was not and is not the expected strength of ACA. Therefore an external publisher was sought to take the journal to the next level.”
The Outsourcing Institute’s research shows that the second most common reason organisations outsource is that it allows them to focus on their key objectives, which can increase their effectiveness and improve member/donor satisfaction.
Outsourcing allows an organisation to focus on what is most important to the running of their association, society, institute or charity – whether it is advocacy, governance, pleasing members or fundraising.
Additionally, outsourcing allows NFPs flexibility which is not achievable when hiring someone internally. Outsourcing allows organisations to access professionals when and only for as long as an organisation needs them.
“Without sounding gratuitous, the services provided Third Sector Services are both professional and friendly, and very flexible,” admits Bondar.
By decreasing costs, improving the quality of an organisation’s offerings and allowing NFPs to focus on their core objectives, outsourcing is expected to continue to rise in popularity as the smarter choice for NFPs.
