Episode 88: Five Questions To Consider When Outsourcing For Your Small Business
Have you ever considered hiring someone to assist you in your admin tasks, social media and other work that you feel you need help with? In this coaching episode with Fiona, she shares her experience outsourcing to help her with the other deliverables needed in her business. She also shares the five questions you need to ask yourself before hiring someone.
Topics discussed in this episode:
Introduction
Outsourcing
5 Questions to Consider Before Outsourcing
1. How much is your time worth?
2. What exactly do you need someone to do?
3. Are your timelines realistic?
4. What is your budget?
5. How will I measure success?
Recap
Conclusion
Resources mentioned in this episode:
Episode transcript:
It's my goal in life to talk a lot more about money, because it's something that we don't talk about enough. And then people have kind of all these perceptions around self worth and how much they earn and competition and all that kind of stuff. But you want to first get clear on how much is my time worth. This is one of the most important things to figure out. And also something that lots of us never actually sit down and set time aside.
Hello and welcome to episode 88 of the My Daily Business Coach podcast. My name is Fiona Killackey. I'm a business coach. I'm an author, I'm a speaker and all sorts of other things. And if you'd like to connect with me, if you listen to this podcast regularly, thank you so much. Or you've just started. And you're like, Oh, she seems like a normal, nice person. Totally come on over to Instagram. I'm at my deli business coach and we can get chatting in the DMs. All right. So today is a longer coaching episode and it's really where I talk you through tactics or strategies or things you can think about implementing in your business on one particular element. So today's topic, I've chosen one because I get asked this question all the time. And so I thought, you know, let's put it into a podcast so I can answer people on mass, which is always, you know, useful getting it out to the group.
But also it's something that's come up for me recently. More so just the importance of doing this. I am coming to, after spending two weeks being quite ill with my family, we first had food poisoning. Three out of forests got quite sick. We were really, really projectile vomiting. It was really fun. And then we went away and then our youngest child got sick and he's in childcare. And you know, anyone who has a child in childcare knows that they often come home with lots of different germs from lots of different other kids and they kind of share it around. So we had one week of being really sick from food poisoning and then a kind of a bit of a break. And then another week of really horrible colds we got tested for COVID 19. Thank God we don't have it. But yeah, it's kind of put a real light on an area of business that is super to think about particularly before you actually need it. So let's get stuck into today's episode and find out what
We're actually talking about.
All right. So just before I get stuck in, I should also say, obviously I don't sound the same way that I normally say I'm a bit mom nasally. I'm still trying to recover from this cold. Ideally I would have batched a lot of podcast episodes. I wouldn't have to do this with the way that my voice is sounding now, but let's keep going. Hopefully you'll forgive the kind of March Simpson, sister sounding voice that I've got at the moment. All right. So what I want to talk about today is should you outsource that is, should you find other people to help you with your business? And if you are about to do this, the five key questions that I think are really important to answer first. So firstly, I guess you might be listening to this and you may have staff already and you might be wanting to add to those or bring in somebody entirely new or have somebody who's casual or freelance to do one particular part of the business.
Or you might be like, I used to be a few years ago where I was doing the bulk of the business, myself. Basically I was doing all of it myself. Sometimes I would hire people to help, particularly with a project for a consulting client, or I might hire people to come into a workshop just for that day to help me in terms of getting coffees or putting out workbooks or, or doing some of the admin of like checking people in and stuff. But predominantly I was working by myself. And so it got to a point where I was thinking, well, should I outsource this? You know, should I outsource inbox management? Should I outsource graphic design? Should I outsource other things in my business and not sort of try and be doing everything at once? So you want to think about firstly, if you're in that situation or where you sort of sit in that, you know, I speak to many students and clients and people that come to speaking gigs.
And I find that quite often, there's this idea that I need to be at a certain level before I even consider outsourcing. And I wouldn't say that's necessarily wrong, but I think that that can lead you down a path of being overwhelmed because you're literally carrying all the plates. And so if that's, what's come up for you immediately, when I've said outsourcing, you're sort of like, no, no, no, can't afford that. Not at that stage yet. Keep listening because it might be that by the end of this podcast episode, you realize actually I can't afford it. And it's definitely something that I want to pursue. So for most small business owners, regardless of when you started what your experience is, there will definitely come a time when kind of the cost of doing something that you're not familiar with. You're not an expert in, or that just seems overly tedious, outweighs the cost of paying somebody else to do it yet.
Like I spoke about before sometimes regardless of this kind of potential cost benefit, there's also a little bit of an internal struggle because there's the fear of not only potentially spending a lot of money and not knowing what the outcome is going to be like, but also this fear of giving up total control over the business. And that can be a real fear and it can be, it can be more difficult than the financial side of things. So today I kind of want to talk about how do you know when you need to outsource and what you can kind of expect from the process, but also what is right for your particular business and trying to think of outsourcing in terms of what's the business goals, how am I going to get there and who potentially is going to help me along on that journey?
Now I've done a fair bit of research around this subject for my clients and also for myself. And these are the five questions I really do believe that every small business owner needs to confidently answer, not just answer, but confidently answer, knowing the full extent of yep. This is exactly how I feel about that particular question. Well, before they sign off on any outside help, so let's get stuck into the five questions.
So the first thing to get super clear on is how much is your time worth?
And I know again, anything to do with money can be very triggering for people. It's my goal in life to talk a lot more about money, because it's something that we don't talk about enough. And then people have kind of all these perceptions around self worth and how much they earn and competition and all that kind of stuff.
But you want to first get clear on how much is my time worth. This is one of the most important things to figure out. And also something that lots of us never actually sit down and set time aside to do. So say for instance, your business is bringing in, let's just for argument's sake, say $200,000 a year and you work around 40 hours a week. You work in average, you know, nine to five kind of job. That means that your hourly rate before tax, before any kind of other things come out is approximately $96. So that's, you know, 200,000 divided by 2080 hours, which is 40 hours a week. So if you're spending six hours a week on say admin tasks, such as, you know, submitting, repeat invoices, scheduling social media, and some other tasks you are in effect costing the business for that time $576 a week.
And you might say, Oh, okay. I didn't think of it that way I could afford to pay someone well, slow your roll because it's not always that simple now consider whether you're learning anything when you're doing these tasks. And if you are, how much is that knowledge worth? So for some business owners, you know, spending the time to understand how a scheduling tool like hoot suite, which is a scheduling tool from all sorts of social media platforms or an analytics platform like Google analytics or Google data studio or Google content studio, they might spend that time doing that and it can actually help their business. And they see it as a long-term investment because maybe that's an area that they'd really like to grow in, or maybe that's an area that they would actually like to offer as a service to other business owners, for example, a Google analytics specialist.
So you want to review the pros and cons of any tasks that you could outsource against firstly, what is your time worth? And also is doing that task, really investing in your long-term knowledge. And is it something that's good for the business? Sometimes the answer will be yup. And other times it will be no Gullo analytics is not something that we're ever going to offer as a service in our business, or I don't necessarily want to become a graphic designer. So I'm really happy to outsource that part. It doesn't give me creative joy. It doesn't make me feel free, so I'm happy to outsource it. So that's number one, get really clear on how much is your time worth.
The second thing to get super clear on is what exactly do you need someone to do?
And I know that might seem like, well, you know, these emails are piling up or, you know, we don't know anything about analytics and at first sight it can be like, Oh, it's really simple.
What I need someone to do, but really think about, are these weekly tasks, are they daily tasks? Are they monthly or a mix of all three, are the tasks set up and they're ready to go. And someone could just walk in and understand how to do it. Or do you need to invest time in creating your process documents or tutorial videos? Do you need to put together your password list or use a tool like first pass or any other kind of password tool, or do you need to create manuals to assist the person that you're outsourced to now I've consulted to lots of companies and often I'll work with the CEO or the MD. And part of what comes up whenever we look at their business systems is, Oh, the people are the problem. The people are the problem. This person isn't doing their job properly.
And that might be the case. But what I see more often than not is that their processes are not set up for the people to succeed. These people have been hired and not actually given the documentation or the tutorials or the handholding at the start to be successful in that role. So you want to think about that. You want to think about it in terms of how much time is that going to take you. And that can be another time vacuum that business owners just have not been accounted for. And perhaps it is about you setting aside time for like the next three months to get the process documents in a really easily digestible format before you go and outsource or hire somebody. So you want to understand which tasks you'll outsource and then secondary to that. The part that often gets missed is you want to create all the necessary items to ensure someone outside the business can easily pick these up and roll with them, which is going to cost you less time and money in the long run.
I've seen it so many times where people have not had the process documentation in place. And so they hire someone. It doesn't work out and they've had to spend money on advertising for that time and investing in that new staff member, then they're not set up. So they fail in that role. Then they get rid of them and then their whole thing starts again. So really hear me when I'm saying that spending the time to set up your processes, whether it's in a tool like Asana or Trello, or just a good odd word document or Google document that is going to save you time and money in the long run. So that's number two. What exactly do you need someone to do now? A good freebie that I've got for this, which could help you is called the skills matrix. And we'll link to that in the show notes, but it's also available.
If you just go to mydailybusinesscoach.com/freestuff in there, you'll find a bunch of other things as well, but the skills matrix allows you to work through what skills are missing in the business and potentially could be the starting point if you're creating a job role for whoever it is that you're going to outsource these things to number three:
Really want to ask yourself, are your timelines realistic?
And this can be a big one to work through. Particularly if you are somebody as many small business owners are, who is quite driven, quite ambitious and kind of is capable of taking out a lot at once. So you want to think about what to expect of ourselves within the space of an hour or two. And then what do we expect of somebody that we're outsourcing tasks to? Because two things could be vastly different.
We can expect a lot more from someone that we're paying then potentially we could do ourselves or vice versa. We might think, well, I've been in the business for eight years, so I know how to do this in 15 minutes, that person coming in does not have that experience. So we can't expect that that person is going to be able to pick up a task and do it as quickly as potentially we may have been able to do. So you want to ask yourself, how quickly do you expect someone external to complete the tasks or manage the project that you've set? And are you being realistic with these timeframes? And what are you basing that on? Have you accounted for this person to, you know, take the time to understand the basics of your business to get to grips with your business? So, one thing that you might want to do is to map out a simple spectrum or an axis marking one end slow, and one end fast.
Now Mark a rough timeframe against each side I four hours or 20 minutes in question, how much of the spectrum you would be willing to accept? So at what point does outsourcing become too great a cost to you? And this is sometimes something that you're only going to learn in, you know, trial and error. It's one thing to be completely aware of, you know, potentially where you're being unrealistic, but it's also another that you may end up hiring somebody who just doesn't work as fast as you have hoped for, or potentially, who's just getting to terms with your technology or the platforms or the tools that you use. And so you need to go back and train them or pay for some training or things like that. I have had numerous virtual assistants working with me. I have two at the moment. I also have an amazing podcast editor and I have a woman who I outsource some of my graphic design to as well.
And definitely they're amazing, but I've hired people in the past who have definitely not lived up to the kind of sales pitch that they presented to me. So you want to take this one, you know, are your timelines realistic on one hand you want to really think about, are you expecting too much? But then on the other hand, where's the tipping point of which this just would not become worth your while. So if you're paying somebody $40 an hour and you expect the task to take two hours each week or each day, and then, you know, what if they got to three hours, would that be enough? What if it was four hours? At what point are you going to pull back and say, actually, this is not worth me outsourcing that to, or I need to pay more for somebody who knows this stuff inside out.
And you'll often find that when you're getting people like a virtual assistant, I tell people quite a bit that if you're hiring somebody and you're using a platform like Upwork or other tools that are out there, make sure that you clearly state the platforms that you're already using as a business, because you want people to have some understanding of those. And you might even in your interview process, ask them to rate themselves between one and 10 on the platforms that you use, such as, you know, if you're using Shopify and you need a virtual assistant, who's going to be in and out of the back end of Shopify and is uploading things and is getting data. It makes sense for you to put Shopify as a key platform in your initial job ad so that you're going to hopefully get people who have that experience.
And again, allowing themselves to rate themselves between one and 10 or make you aware of, okay, they've rated themselves as seven. So they're not a 10 out of 10. There might be some things that I need to show them, but they're definitely not a three or a two. So that's number three. I have timelines realistic number four. And this is a big one as well. Is what's your budget? How much are you willing to spend to pay someone else to help you in your business? And again, this can be how long is a piece of string. It can be. How important is that job to you right now? Are you willing to have somebody else who's potentially less skilled, but you can train up or do you want someone to come in? Who just knows their stuff. And you're more likely going to have to pay more for that person, but it could be, you know, we need to get X, Y, and Z done in three months.
So I'm happy to pay more, to just get someone in who I don't need to kind of handhold, or you might say, actually, this is like a long-term project for 12 months or longer, and we're happy to bring somebody in and we've got the time to train them up. So you really want to think about that when you're coming to what's your budget, but you also want to back to that first example of like, how much is your time worth and say, you take that first example, like six hours of admin at $96 an hour. If you're costing the business $576, you may decide that you can afford half of this per week. So 288 to pay someone else, or you might decide I can afford the whole lot. It just gives you some sort of starting point to go on, particularly if this is the first person that you're hiring for the business.
And then you want to look at your tasks and your timelines. So most virtual assistants, um, or they're called VAs or people that are doing kind of basic admin will cost anywhere between, I mean, you can get people depending on what you want, but you can get people for as low as, you know, $7 an hour, which you would need to make your own decisions, whether you're comfortable paying that right up to, you know, 75, a hundred, $300 per hour. It really depends in Australia where I am. The average is about $35 Australian per hour. It can go up. It can go down. When I have looked at us virtual assistants on average, they have started at around $20 an hour, $25 an hour. I did have one in the U S that I used to pay $45 an hour, us, which sometimes with the exchange rate was like 70, $80.
And that didn't last for long because I just didn't feel like I was getting the return on investment from that person. So you really want to think about, are you going to be able to allocate enough money to get all the tasks done in the time period that you want? And it goes back to what I was saying before. If you've got a shorter time period, and you've just got to get this stuff done, you might be happy to pay a higher rate. Then if you've got somebody who is sort of consistently going to help you, you know, for years and years, it could also be what skillset these people have. So with some people that I've hired, I've really had to train them and that's been ongoing training, ongoing handholding. Uh, the people I've hired have sort of just had really great skills in a particular platform, and they've been able to get in there and just run with it.
So you want to be thinking about this and then figure out a budget that you can afford, and that suits the needs and the tasks and the time that you've identified for your business. And it's during this step that you may well identify that you're just not ready yet to outsource the tasks. I remember when I was first getting started with virtual assistants, I talked to an agency in the U S and they had, it was like the bells and whistles. And this virtual assistant could do everything for you and book your dentist appointments and get your shopping done, and kind of be like a personal assistant as well. But they had a, you know, we need to have this many hours per week guaranteed locked in with you. And at that time I thought, I just can't guarantee that I don't know if I have that much work for them to do.
And it was in us dollars. And of course he had a big agency fee as well. So at the time when I mapped it all out and I just thought, I actually cannot see myself one having that much work for the person to do so they'd potentially just be super bored or contacting me all the time. And then to the cost when I did the exchange rate was just too great at that time for my business. So that's number four. What's your budget really? Think about how much are you willing to spend to pay someone else to help you? What's your time worth? How much can you afford? And also, I guess, in that as well, think about what's the cost. If you don't hire somebody. So for instance, I often use this example. I have this podcast, I record this podcast. I use garage band.
Most of the time, if I interview people, I use zoom. If you are interested in learning everything that I do with this podcast, you can buy my, how to start a podcast course. We'll link to that in the show notes, but I pay an editor he's Australian, but he lives in Canada, shout out to Scott. So I pay him to edit these podcasts, but I don't edit them myself. And I've had people in the past, Oh, you should just learn how to edit. And yet, you know, potentially one day I could, but the cost of my time sitting here editing podcasts, I put out two podcasts a week. I'm happy to pay somebody else to do that. Who is an expert at it? Who can change things very quickly. Sometimes there's been instances where I've said to Scott, Oh my gosh, you know, Oh, I forgot to tell you, you know, can you take that part out?
Or can you add this part? Or I don't like how that sounds and he will fix it so quickly. He's just incredible. And so I'm happy to have that peace of mind to know that once I've just recorded this, like I'm doing right now, I can just upload the files to our shared Google drive. And he downloads them and he does his magic and it's already, and then I have an amazing virtual assistant who takes those files and puts them into a blog article for us on the website. She creates graphics. She liaises with our guests and kind of makes it all happen. So between the two of them, I have confidence that this podcast is going to come out every single week. And that I haven't actually done that much besides talking into a microphone in the comfort of my own home. So that budget, I'm happy to spend that on Scott and on Nezi. Cause they're, they're doing such a great job.
So number four, what is your budget?
So figure out a budget you can afford, and that kind of suits the needs of your business, where it's at. And like I said, it might just be that you decide at this point, you know what, I'm happy to do it myself for another three months, or I'm happy to start the ball rolling and find somebody to do this work for me. And then number five, which is really important, no matter what you're doing in your business, but particularly when it comes to outsourcing. And particularly if it's your first time of outsourcing is how will I measure success? Now I have heard that many horror stories about people losing money when outsourcing and I've lost money. When I'm outsourced, I brought somebody in to work on my Pinterest and they seemed incredible.
Like I was blown away. I was telling other people about it. Yeah. And it quickly became apparent that their understanding of Pinterest was pretty basic. And so unfortunately I just had to pull the plug and be like, this is not gonna work. So, you know, that was, that was really hard because I was so invested and I thought, you know, I listened to them. I talked to them, I thought, Oh my gosh, they're going to really help us transform this. I love Pinterest. I'm always talking about how great Pinterest is as platform. And I can see what it does for our business in terms of traffic and awareness. So, you know, it was really disheartening for me to be like, Oh, okay, I paid this money. I thought they were going to do X, Y, Z. They didn't. So that, that can be hard. But I also, as a business coach, I hear from so many people who come to work with me either that they've spent this many thousand dollars on a business coach that didn't actually help them, or they have spent tens of thousands on an SEO agency that didn't really do anything for them.
Or they spent, you know, X, Y, Z on a website agency that didn't check super basic things that, you know, we can go through in 20 minutes or their first call. And I'm like, wow, I'm really sorry that you had that experience.
So number five is how will I measure success?
And usually the biggest sort of issue with those agencies or designers or whatever, or business coaches even is that there was never any kind of discussion over what are you trying to achieve. And what's kind of a success metric that can be put in place by the business owner prior to hiring somebody. So I often ask my coaching clients to make a promise to themselves to kind of commit to things, but also to list out what's the biggest thing you want to get done in the first 90 days. What's the biggest thing you want to get done in the next 180 days?
Why and how are we going to work towards those things? And so we can check in regularly and of course, people still need to do the work and SEO agency. Isn't going to just, you know, save your business completely without you doing any work, same with the website agency or business coach. Like you still need to be doing the work. You're not putting everything onto that person that you're outsourcing to, but you do need to be aware if I'm outsourcing this and I'm paying for it. What is the ultimate goal for me is that I'm going to have more time back. Is it they're going to help me, you know, increase my conversion rate? Is it they're going to come up with really interesting ideas that we can execute as a business for our marketing? What is the success metric that you are going to measure?
Whether that outsourcing project has worked or not. And in some places I should say that metric may be super clear. It may be, we're trying to increase money. And yeah, I worked with this person and they helped me see different revenue streams, and we offered one and, and we sold it and it did really well. Other times it's not going to be as clear, but it might be actually really confident now in an area that I wasn't so confident in before. And you're not necessarily going to be able to measure that as easily as you can with financial income, but you are going to measure it in terms of I started here and now I'm here. And I've definitely seen that in some of my clients where they've started saying, Oh, there's no way I could contact an editor for, you know, showing my work or there's no way I could reach out to somebody like that.
And then you know, a couple of months or whatever that we work together, there'll be saying to me, Oh yeah. So I reached out to that person, that person, that person, and I'm like, look at you, you know, look how confident you are doing that. And that's them, they've done the work. I've just been able to, you know, be there as a guide. But you want to think about how am I going to measure success? So you want to review the list of tasks that you came up with, how you measured success on those tasks. Will it be okay? All the work was completed on time and to budget. Will it be that someone else is taking on the creative brainstorm and their ideas are like consistently fantastic. And you really feel like they get your brand. Will it be that their work results in quicker payments or greater traffic to your website, whatever your tasks are, you want to ensure that each has a clearly defined metric for success attached, and also discuss this with anyone that you bring on, you know, don't hide these away, be open and be like, Hey, I think together we could achieve X, Y, Z.
That is just going to make it easier for everyone involved and outsourcing. You know, it can be an absolutely brilliant move for small business owners. It can allow you to have a lot more time to work on the business, rather than just in it. It can open up your networks, open up your ideas. It can be such a fantastic thing that you do for your business. And it really can allow you to grow, but choose wisely because not all people are the same and not all are going to be able to deliver on what they say that they're going to deliver on. Ask for referrals, ask for testimonials, and actually, you know, check with them. I've followed up with people and said, Hey, I can see that you've given a testimonial on this person's website. Tell me about your experience with them. Tell me what was good, what was bad?
And sometimes people have been surprised that I've done that, but I think that's just due diligence. And unfortunately I've learned the hard way that sometimes things that are promoted are not always completely aligned with what's actually delivered. So yeah, that's the five questions that I think can be really, really valuable to go through and work through and feel like you can confidently answer before you outsource.
So to recap,
#1 How much is your time worth? And this is particularly true. If this is the first person that you're going to be bringing in into your business, how much is your time worth? How much are you costing the business by continuing to do this thing yourself, rather than outsource it to an expert?
#2 What exactly do you need someone to do? And do you need to do a bit of work so that they can move in and successfully complete whatever it is that you've set for them? So, number two, what exactly do you need someone to do?
#3 Are your timelines realistic? Are you completely setting somebody up to fail? Because you are just being so unrealistic about what they could actually achieve in a certain amount of time or on the flip side at what would you call it a day and be like, this is actually not working. So number three, are your timelines realistic?
#4 What's your budget? How much are you willing to part with in order for this to work? And also what's the longterm cost. If you don't part with your money, are you going to be overwhelmed? You going be stressed out. Are you going to feel like you're not seeing your family? So really think about number four, what's your budget
#5 How will you measure success? What sort of metrics can you put in place? What do you hope to achieve? How could you share that with the person that's coming on board so that you're all across it, and you can start measuring that as you go and you don't end up in a situation where it gets to the end of sort of three months or six months and you think, Oh, what have you actually done?
So another thing I should mention in number five, really that I suggest to clients, and you'll be familiar with this. If you've ever worked in kind of corporates or a place where they've got a full HR team is the 30, 60, 90 day rule. So what do you want somebody to have achieved in the first 30 days of working with you? What would you have hoped they'd got through by the first 60 days and then the 90 days? So usually in corporates here in Australia, the probation period is three months or six months for more senior roles.
And so, you know, take that in mind when you run a small business as well, you may not have HR team or HR consultant, but really think about, okay, if this person was coming on probation for three months, what would I expect them to have achieved? And then have I, as the business owner allowed them to succeed, have I set them up with your documentation? How I sent them up with passwords? How do I set them up with just brand knowledge? When my virtual assistant started the first one, I created kind of a document that was like, Hey, here's everything about my business. And for the first two weeks, I don't want you to do any tasks. I just want you to go have a look at my Instagram, go and have a look at, you know, articles that I've written, go and have a look at interviews.
I've done. Go and have a look at speaker videos and really get to understanding what is my daily business coach and who is Fiona Killackey. So that you've got a really good understanding of this before we start you on tasks. So that's something I'd always suggest as well. If you are hiring somebody, that's going to be long-term, it's not someone who's just coming in for like a short term project. So yeah, number five, how will I measure success now, if you're listening to this and you're thinking, yep, I definitely want to hire somebody and I'm thinking I need to hire a virtual assistant, or I really want to kind of understand a bit more about that. I have a free video training in the good business group on Facebook that is literally on this. It's how to source and start with working with a virtual assistant.
So if you are interested in that, definitely go and join the good business group on Facebook. We'll link to that in the show notes, or just send me a DM at @mydailybusinesscoach. And I can send you the link straight to that video that you can watch. So that is it for episode 88, as always, you'll find a full transcript with the show, note links and everything else over at mydailybusinesscoach.com/podcast/88 as this episode 88. Thank you so much for listening. If you've found this useful, please share it with a friend so they can get this wisdom as well. All right. See you next time. Bye.
Thanks for listening to My Daily Business Coach podcast. If you want to get in touch, you can do that at mydailybusinesscoach.com or hit me up on Instagram at @mydailybusinesscoach.
