Insourcing: An Unexpected Way to Solve Staffing Needs

Like most small-business owners, you've probably heard about outsourcing… In fact, you probably even do it. But have you ever heard of insourcing? A relatively new concept, insourcing—or bringing work that’s normally outsourced in-house—is a small but growing trend at big companies. Insourcing can also be beneficial to smaller businesses as well.

Improving customer service was the top reason for switching to insourcing; however, it’s not the only one. Companies say insourcing saves them money compared to outsourcing, and also gives them greater control over projects. Another reason to insource: It can lead to happier, more engaged employees.  Insourcing is especially valuable when dealing with millennial workers. By insourcing projects, your business can not only reduce outsourcing expenses, but also provide new opportunities for employees to learn and grow.

If you’re considering insourcing, there are several things you need to think about as a business owner.

Do you have the infrastructure to handle the project in-house? Employees aside, consider whether you have the systems, processes, materials and equipment needed to do the job. Think through all the “moving parts” and your options for obtaining them.

How will insourcing affect your employees? While using in-house staff means you’ll save on the cost of freelancers or independent contractors, it’s not free. You'll need to consider how your existing employees’ duties can be restructured or modified so they have time to handle the new projects. If you're adding duties to their existing workload, plan for how they’ll be compensated, whether it’s a raise, bonus or overtime pay.

Will you need to hire new employees? If the insourced project is big enough, it may justify new hires. Or you might move an existing employee into that role, then hire someone to fill his or her old job. Ideally, try to promote from within if you have the expertise; that way, any new hires can be entry-level, so they’ll cost you less and your existing employee will benefit from the promotion. With any hire, remember to take additional costs, such as benefits, into account.

Learning what your employees are capable of and giving them the opportunity to use more of their skills—and develop new ones—can help both your employees and your company grow stronger and more successful.