The rapidly expanding scope of "functional" outsourcing

The concept of outsourcing from a business perspective has been around for decades. However, more often than not the outsourcing targets have been restricted primarily to manufacturing processes or technology infrastructure. Historically, the rationale has been that as long as the discipline ranked as a "core competency" for the company (i.e. product design, resource management, etc.), it would remain in-house.

Today, the business leader's priority has shifted from the concept of identifying core competencies to that of determining what portion of the workload can be completed more efficiently and/or more effectively through external partners. In working through this process, executives have been discovering that the concept of outsourcing can apply to a number of corporate functions that have been historically labeled as "untouchable" by previous generations of management.

Included in this portfolio are a number of traditional consulting target markets, including the likes of HR management, sales leadership and strategic marketing. For years, consultants have been providing services to companies that were in need of short-term assistance in these areas primarily due to a significant transition in the organization's internal personnel (i.e. new hires, internal promotions, etc.).

However, there have been two trends over the past couple of years that have been graying the lines between this ad hoc consulting model and the traditional outsourcing model where services are designed to be provided on a perpetual basis. First, employers have come to the realization that the need for many functional roles (like HR managers, marketing managers, etc.) are often cyclical in nature and therefore may be better filled on an "as-needed" basis. Second, many consultants have begun to offer retainer-based services where for a nominal fee, the company has the ability to engage the same consultant as and when demand within the company dictates. Thus, companies are able to invest in expert guidance when it is required rather than being forced to burden the company with the cost of the resource on a full-time basis.

There are indeed some environments that are better suited than others for this form of functional outsourcing but it would be doing your company a true disservice not to consider the possible application of this model within your business. Old habits die hard but more often than not the opportunity to secure a competitive advantage for your business will present itself when you look beyond the status quo.