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Sunday, May 03, 2009

Everyone is an outsourcer

I am an advocate of the outsourcing model. That does not mean I believe companies should send all of their jobs to another country. Rather companies should focus on their expertise not on "all the other stuff." If you look at outsourcing they way the typical middle class family does you would see that they have been outsourcing for some time. So much is outsourced that many people no longer what they are doing as outsourcing. Here are some examples of family outsourcing:

  • Daycare or after school care
  • Tax preparation services
  • Dry cleaning
  • Gardening
  • House painting
  • Plumbing
  • Growing food
  • Dining out or buy ready made meals
  • Clothing (do you make your own?)
  • Entertainment (movies, TV, sports)

This is not sending jobs overseas, rather it is freeing up time for higher value activities (ones you would rather be doing instead of these)

All of these things are forms of outsourcing and yes some of them are done overseas but a vast majority are local. Why do we outsource so much of our family work? Some would say because both partners are working and don't have time for these activities. I would argue that both partners are choosing to focus on higher value skills and outsourcing the items that can be performed with better expertise or for lower cost by someone else.

This is the most basic of arguments for the outsourcing model. What is your business and how does your business make money. Doing taxes is not about making money unless your are a tax accountant. Writing computer software is not about making money unless you are a computer software developer.

Most organizations need to be focused on product innovation not on how to complete their tax return, find the best office space, or the bookkeeping. When a company is small much of these activities are outsourced; what changes as an organization grows that requires these activities to be done in house? What activities are you as an individual still doing that should be sourced elsewhere to free up your time?

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