Which direction should you go once the decision has been made to look outside the organization for additional support? There are two main ways to go – that is of a Professional Outsourced Staffing Solution, or the way of the Freelancer. This article will discuss a single position to be filled as opposed to hiring for example a marketing agency.
A couple up-front differences:
An outsourced team member is an employee of the partner company - a Freelancer is usually self-employed and independent.
An outsourced team member typically works with only a single company to fulfill a single client - a freelancer will typically work on multiple projects with different clients all at once.
An outsourced team member is monitored by the client as well as the partner company - a freelancer being independent is not monitored nor managed (some of the hiring platforms like Fivver do assist with this to an extent, but the freelancer does not work for them)
Outsourcing a team member
Working with a quality partner, you will find these companies are extremely professional and provide easy access to fill talent gaps. They are great to quickly ramp up one too many resources and get working immediately. They are filled with trained professionals with varying degrees of experience that can be mapped out and selected for long term cooperation.
One major difference here is that these are not temps and these partners are looking to fill long term part and full time positions. So, if you are looking at a specific project and nothing more, freelance is your choice.
Outsourcing can work in any field but excel in working as a talent gap fulfillment to your current needs. Need to build your bookkeeping and accounting back office so they can keep up with doing the day to day and sales taxes? Hire a full service team outsourced that uses a combo US and Sri Lanka team to cut costs as opposed to hiring a full time MBA. The cost saving can be staggering. Need a video or photo editor, a project manager, an outbound calling person, again this is where Outsourcing wins, the team member will have all of your images, colors, graphics, and scripting and can probably do about 25% more work than your in-house people. See our article on How to utilize an outsourced staffing team.
Costs can vary – depending on the level of experience and the size of the people being utilized, but generally the larger the team, the more overall discount per person. Depending on where the resources are located and the talent gaps you are looking to fill, you may be pleasantly surprised to find how quickly you can fill those needs with amazing talent.
Hiring a freelancer is a great low-cost way to work on specific tasks or projects. The freelancer themselves usually must handle their own self-promotion, negotiation and accounting, so there’s a lot of wiggle room when it comes to negotiation.
A big difference here is that the freelancer is always on the hustle, may have multiple clients at the same time and is not an employee of the contractor.
With the rise of the digital marketplace mentality, there have been numerous freelancer sites popping up such as Freelancer.com, Upwork, or Fivver. These allow for a modicum of stability for freelancers to find work, and those seeking freelancers to feel secure that their hire will complete the task competently. A huge boon to the industry.
Some major drawbacks of a freelancer are that due to their overall freedom and ability to constantly find work, their reliability could become an issue, they could be overbooked, or they decide to stop doing what they do and work at a full-time gig somewhere else. There's also an issue of prioritization when freelancers handle more than one project at a time. They tend to focus on their higher-paying, long term projects, taking on the occasional odd job here and there to supplement their income.
The lifestyle of a freelancer is a fluid one, especially with the major shift to a digital world and lifestyle, which has stronger pros than cons usually as you can get someone highly qualified with extensive experience, but due to them having a much lower cost of living, they tend to be able to deliver a high-quality product at a lower price.
Which way to go?
There is no right answer here, as it is dependent on the overall needs of the business. Outsourced staffing provides a high level of competence along with more of a stable "employee" feel without the costs associated with an in-house team member. Freelancers provide experienced work with an adaptable mindset (think faster deadlines in the middle of the night), with less structure and far more one off project mentality.
Ultimately – the choice is yours.
When you make your decision, with either an outsourcing team or individual freelancers, the cost savings for the value are huge. Gone are the days of lower educated coding farms overseas. You now get experienced experts with multiple degrees who are on a path of continual education always improving. Another item to point out is the fixed cost. No need to pay for employee benefits, recruitment costs, or bonuses. Yes – no need for an annual bonus with either format.
The final cost savings are those pesky hidden costs that happen when an employee leaves. The whole recruitment process has a resource cost, that is ongoing, and only ends after the termination. All that internal knowledge has a maintenance cost. In the world of outsourcing or freelancing, this cost does not exist. You are paying for a service or project to be delivered. No other costs such as equipment need to be factored in. Also – once the project is done, it is easy to shift them to the next project or even assign them to another team, or in the case of freelancers, say your thanks and end the contract with no employment liability.
Either way – enjoy the cost savings and flexibility!