To Outsource or not to outsource projects?
A company’s internal team may lack the specific expertise or the number of personnel required for a project, making outsourcing a wise solution. On the other hand, outsourcing comes with its own challenges, such as finding the right partner and managing the associated additional costs.
So, what is the best course of action?
In this article, we answer that question based on insights shared by Jani Rathgeber, CEO of Semat.
When Is Outsourcing worthwhile and When Is It Not?
“Based on Semat’s extensive experience, we have found that the most common reasons for outsourcing project operations are often related to finding the right expertise. A company may not have a project manager, project scheduler, project coordinator, or another key professional with the specific skills required for a particular project,” says Rathgeber.
Recruiting new personnel is a time-consuming process that requires resources extending beyond the project itself. Through outsourcing, the right project professionals can be brough on board quickly and, if necessary, they can also be replaced during the project, and the costs are limited only to the project itself.
“Therefore, outsourcing project professionals is worth considering when an organization wants to secure access to specialized expertise without committing to permanent hires. If the project requires expertise outside the company’s core business, it is worth checking with a partner to see if suitable people could be found for the project,” Rathgeber continues.
Outsourcing is also beneficial when project leadership requires extensive experience and a strong management approach. Through outsourcing, organizations can select the most suitable leaders based on both competence and experience.
On the other hand, outsourcing project professionals may be unnecessary in situations where all the necessary expertise is already available for the project, and the demand for specialized skills is relatively stable.
“Before starting a partnership, we always review the project as a whole with the client. This includes assessing the need for outsourcing and identifying the most effective collaboration model,” says Rathgeber.
The 4 Key Benefits of Outsourcing Project Operations
If outsourcing project operations is the chosen path, what are the key advantages? What can organizations expect from outsourcing project profesionals, and what should they keep in mind when considering it?
Below are the benefits most commonly associated with outsourcing project operations..
1. Broad perspective and extensive experience
By outsourcing project professionals, organizations gain access to diverse experience from multiple industries, bringing valuable external perspectives into project operations. Outsourced project management can introduce leadership practices and expertise from different sectors, enabling the project to benefit from proven best practices tailored to its specific needs.
“In some cases, outsourcing the entire project team may be the most sensible solution if the project is one-time in nature and requires extensive experience and specialized expertise that will no be ot needed after the project,” says Rathgeber.
2. Cost-efficiency and transparency
Outsourcing enables more accurate cost forecasting, while standardized documentation and reporting practices increase transparency regarding resource utilization. Whether partially or fully outsourced, project operations often benefit from a clearer cost structure and more efficient resource management.
“At Semat, our project managers are always required to document and report all project work thoroughly, ensuring that all documentation is easily accessible once the work has been completed. This is the only way we can demonstrate afterward that the work was carried out effectively and that costs remained under control. In other words, transparent and efficient reporting is essential both for our own business and for the success of the project itself,” says Rathgeber.
3. Quick and flexible response to changing resource needs
Outsourcing project professionals helps ensure the right expertise is available both when the project begins and throughout its entire lifecycle. Access to a broad talent pool increases a project’s adaptability and enables rapid project launch even under tight deadlines. Having qualified professionals readily available also provides a solution when project staffing needs increase or change throughout different phases of the project.
“Above all, outsourcing project professionals brings new perspectives and ways of working into a project. By expanding the talent pool beyond the company’s internal workforce, organizations can benefit from specialized expertise and fresh viewpoints”, says Rathgeber.
4. Minimizing recruitment risks
Expanding a company’s own workforce always involves certain risks. A new hire’s capabilities may not fully match the demands of the role, or the individual may not fit the company culture. Likewise, the employee may have had inaccurate expectations about the position and may either leave the company or struggle to remain motivated.
In any case, a hiring mistake always generates extra work and unavoidable expenses for the company. This is where outsourcing offers a valuable advantage. Outsourced project professionals are never placed on the client company’s payroll, meaning that the risks associated with selecting and employing talent remain with the outsourcing provider.
“When outsourcing, all risks and costs associated with personnel selection are limited to the duration of the outsourcing agreement. If a specialist has been contracted from us, we will ensure that the right person is found for the project. Sometimes this may require replacing a team member or adding more resources even after the project has already begun,” says Rathgeber.
Reliable Project Outsourcing with Semat
Semat’s project services, from project managers to specialists in project support functions, are designed to meet every project need. We have helped our clients deliver projects of all sizes and have been involved in resolving a wide range of project-related challenges, after all, this is our core expertise.
Above all, we act as a partner and advisor to our clients. We do not merely provide the expertise required for a project; we also bring valuable insight into project planning and execution.
At the start of every engagement, we review the project together to determine which operating model would work best in that specific situation and what kind of cost structure would most effectively support the project’s objectives.
Following the assessment and planning phase, we review the available options for project roles together. We then provide the project owner with information and CVs of suitable candidates, allowing the best professionals to be selected for the assignment.
Backup resources can also be identified from the available talent pool in case additional support or replacement personnel are needed during different phases of the project.
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