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Outsourcing and Other Ways to Reduce Costs Post-Covid

Outsourcing and Other Ways to Reduce Costs Post-Covid

January 16, 2021

As many of us continue moving back to the office, now is a critical time for organizations to take decisions regarding their physical makeup. Do we want to stay a fully remote company? Do we want to bring only certain elements of our team back on site? Or do we want our entire operations once again running from one location? 

It’s likely, of course, that many companies will work out a hybrid solution that best suits their organization and embraces the newfound remote-working successes they have discovered during this forced period of working from home. 

A hybrid model will also, of course, offer up the option for a quick return to working from home should the need arise.

Where to Start

Assuming a significant number of organizations will continue with a predominantly remote-working model, or at least some variance of this, one area that can be immediately assessed is office management. If organizations are planning to no longer have a physical office, the role of office manager can be reassessed and any necessary tasks outsourced. 

Other obvious areas for outsourcing in a newfound remote-working culture include bookkeeping or procurement management, for example.

What’s important is that organizations spend some time determining which functions are necessary to keep in-house and what it makes more sense to outsource. This is particularly important of IT functions, which can offer significant pricing structure differences.

For example, managed print is a logical outsourcing option. Businesses spend significant amounts of money on printer cartridges when they could be paying for printing by the page. We recently carried out an audit for one of our clients and the result is a saving of $30,000 a year on printer expenses by outsourcing and paying on a per-page basis as opposed to a cartridge basis.

An audit like this can touch various other elements of the business, including procurement, line-of-business cost centers, and so on. And these are all areas that can be considered for outsourcing, along with vendor relationships and line-of-business application support.

IT Outsourcing 

When it comes to your IT team specifically, there are a number of ways to consider sourcing out. Many teams typically have a desktop support layer, manager layer, and then director/CTO management. Desktop support is incredibly challenging for midsize organizations that have a large physical presence in the office, but in this changing world where you don’t have your staff in the office, having a person on staff or nearby that you can tap on the shoulder for desktop support is irrelevant. It becomes far more cost effective to have desktop support elsewhere. 

The managerial level can also be outsourced. For example, for some of our clients, we manage the entirety of their network – their servers, their backups, their security, their asset management – all the things that sit above day-to-day tactical endeavors. Organizations can have somebody on the ground to carry out the tactical side of the business, while outsourcing the managerial level to focus on the strategy. 

This can also encompass the heavy lifting of managing virtualization environments, which can make a significant difference in terms of cost. Hiring a VMware or Hyper-V expert, for example, can be expensive and difficult to accomplish successfully; expecting a single employee to have all of the relevant knowledge can often be unrealistic for an in-house role. 

How?

To understand where you might be able to outsource certain functions, it’s a good idea to have some kind of ticketing system that runs reports and enables you to see where staff time is going. Developing metrics such as these is critical for understanding what positions you need full time and what functions can be outsourced.

Changing Hiring Processes 

When talking about a fully remote or mostly remote workforce, this also raises questions around the hiring process, in particular for organizations traditionally operating out of – and used to hiring from – high-cost markets. The post-pandemic employment map of the U.S. is going to see a significant number of economically depressed cities across the country, and the level of unemployment will be unevenly distributed, with the level of demand also being unevenly distributed. 

In the tech sector especially there will be significant numbers of highly talented people out of work. For those firms that are looking to hire and have developed successful remote-working practices that they are keeping in place, their search in higher-cost markets can be refocused to a lower-cost market elsewhere in the country. This expands recruiting capabilities dramatically, and even potentially, globally.

Ultimately, firms looking to cut costs post-Covid-19 have a variety of options available to them that can be identified quickly and effectively with a dedicated audit of the business model and the organization’s needs going forward. The post-pandemic reality is a massive cost-saving opportunity for all businesses who care to look for it, just at a time when they need it; don’t let it go to waste.

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