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Running a Small Business – The Good, The Bad and The Ugly (Part 2)

Part 2 – The Bad (you worked out the Good, so who’s the Bad in the pic above?)

If you missed Part 1, you can read it here.

 And for the final instalment, Part 3, you can go here.


🤔        So, what’s bad about being a business owner? 


Businesses are demanding.

Responsibilities get thrown at you like confetti at a wedding, but with golf balls instead of tiny paper cut-outs.

Small business owners have to put extreme thought into their departments (or sometimes lack thereof!), as well as decide how they’re going to cover those business functions.

Initially, you might be able to cover most of these yourself. But as your business grows, you need to start delegating these duties to other workers.


But what if getting stuck in the details tears you away from the big picture? Away from your company’s real vision and the reason you started your business in the first place?

Hiring employees is expensive and simply isn’t the best option for small businesses.

Outsourcing your work might stop you from bleeding yourself dry. But it has its pros and cons.


The Pros of Outsourcing

  1. No overhead costs that hiring an employee would generate, such as health insurance, retirement, vacation, sick days, etc.
  2. You have a global talent pool at your disposal, which also offers low-cost labour.
  3. It gives you time to grow your business and direct your focus to what really matters.


The Cons of Outsourcing

  1. Contract labour may be less expensive overall, but these workers don’t truly know the ins and outs of your business.
  2. They would also rarely be present on-site. This is the digital era, but some departments perform better on-site.
  3. Outsourcing particular tasks may lead employees to wonder why you are outsourcing those tasks and not assigning them to your own employees.

Each department also has its own pros and cons. Below is a list of the main departments and some of the positives and negatives of outsourcing them.


Human Resources (HR)

One of the most critical assets of any company, the HR department takes care of your employees and finds skilled workers.

Responsibilities include:

  • Recruiting, screening, interviewing and placing workers.
  • Handling employee relations, payroll, benefits, and training.
  • Helping workers identify areas for improvement and creating development plans.

Specific Outsourcing Pros

  • Outsourcing repetitive tasks like background checks, payroll, etc. saves you money and leaves your internal HR employee some space to breathe.
  • Compliance becomes harder as the business grows. To keep up with rules and regulations you need someone who knows what they’re doing – you may not have the right in-house expertise.

Specific Outsourcing Cons

  • Just as they need relevant professional expertise, they also need to know the ins and outs of your business. Outsourced HR might find it difficult to know what kind of worker would resonate with your business during the hiring process.
  • As mentioned above, HR professionals work closely with other employees. An outsourced professional might not be around often enough to deliver the extent of his or her value.


Accounting and Finance

Accounting and Finance is where you’ll find all the finance-related concerns of your business. You may be keeping your own books at the start, but the numbers can become more complex further down the road.

This department’s vital tasks include:

  • Accounting for and tracking receivables (Money in).
  • Paying bills and keeping an eye out for saving opportunities (Money out).
  • Managing payroll (which can be covered by both Accounting and HR).
  • Preparing financial reports and implementing financial controls with a view toward compliance, fraud and theft prevention.

Specific Outsourcing Pros

  • Saving money on the equipment and software required for accounting and bookkeeping processes.
  • Outsourced professionals offer years of industry experience that you may not find in-house.

❎ Specific Outsourcing Cons

  • Security should be one of your highest priorities, and accounting professionals handle sensitive data. A security breach at your provider’s firm may put your data at risk.
  • You might trust an in-house professional more than an external professional services provider.


Marketing and PR

This department promotes your business and your vision, it’s the face of your company and the fishing rod with which you will start to reel in your customers.

Marketing employees are usually busy:

  • Defining and managing your brand.
  • Determining best marketing channels and strategies for your business.
  • Planning and running marketing campaigns.
  • Helping employees understand your brand and vision.

Specific Outsourcing Pros

  • You might still need to define or revise your target audience, which is a mission in itself. Having access to the experience of marketing experts will certainly make this initial jump easier.
  • PR and Marketing firms are always expanding their network of copywriters, social media managers, SEO experts, etc., meaning they will often have the perfect person for the job.
  • They have extended experience crafting campaigns and messages.

❎ Specific Outsourcing Cons

  • Marketing, especially inbound, is based on knowing your customer. Outsourced marketers won’t be as close to your customers as an in-house team could be.
  • If you have your own marketing ideas, it can be a bit trickier to have to run them by external professionals. A robust process and open communications can usually get around this though.
  • Capturing the voice of your company is critical. If the out-house team doesn’t have an in-depth view of your business, their messaging might fall out of sync.




A department that works closely and even blends with marketing. While marketing attracts the leads, sales converts them into paying customers.

The responsibilities of a sales team include:

  • Making sales.
  • Growing your business.
  • Performing cost-benefit analyses of existing and potential customers.
  • Retaining existing customers.
  • Maintaining positive business relationships.

Specific Pros

  • You might be able to leverage the outsourced team’s existing network.
  • Hiring is a long process, which means it could be an even longer time before that sales employee becomes financially productive.

Specific Cons

  • Outsourcing could lead to losing control of the sales team or the customer relationships.
  • If there is a lack of transparency, the outsourced team could concentrate on building up its own network. You can avoid this by making sure that all proposals and pricing are signed off by you, however, watch that this doesn’t create bottlenecks and delays.




What you do NOT want to do is get your business in trouble. Your legal team is there to guide you on your journey while stopping you from crossing that legal line, which is often hard to uncross.

This team’s responsibilities include:

  • Drafting resolutions, letters and memos.
  • Expressing its legal opinion on issues.
  • Negotiating employee contracts and creating employee handbooks.
  • Preparing legal documents.
  • Working with other admin teams to produce policies for the business.

Specific Pros

  • Outsourcing to a law firm means having access to the latest legal technology and not having to keep up with changing trends.
  • Outsourcing legal processes allows you to hire an expert in a specific field. In some cases, you may need this type of expertise.

Specific Cons

  • You must absolutely make sure that communication with the outsourced firm is flawless. Errors in communication could lead to serious legal issues.
  • When legal matters are no longer routine and standard, a business needs in-house experts that know not only the law, but also the business, inside out.


Customer Service

An unanswered email could lose you a client. Good customer service keeps your customers happy and willing to return to your business.

Some responsibilities include:

  • Resolving customer complaints via phone, email or social media.
  • Reaching out to customers and verify account information.
  • Cancelling or upgrade accounts.
  • Keeping your customers happy.

Specific Cons

  • Be careful when outsourcing a team that’s located offshore. This may put up cultural barriers that can decrease customer satisfaction.



Last, but certainly not least, your IT guys.

They make sure your systems run smoothly and catch problems before they escalate.

The main functions of an IT team include:

  • Governance, which in basic terms can be described as outlining the rules about how employees can use the company’s technology and what they can use it for.
  • Infrastructure – the skeleton of your IT system. This means taking care of circuitry, hardware components, network, etc.
  • Functionality, which might be what most people imagine when thinking about IT. The team creates and maintains applications, secures and stores data, and assists in using software and data management in other relevant areas of your business.

Specific Pros

  • If IT isn’t the main aspect of your business, hiring an out-house team is cost-effective and allows you to concentrate on your core competences.
  • By outsourcing your IT needs, you have access to multiple backup servers, which significantly reduces your risk of service outages.

Specific Cons

  • You must be 100% that outsourcing will protect your intellectual property. This is something to keep in mind when choosing an out-house IT team.
  • Similarly to accounting, storing, processing and protecting data will be managed by the outsourced team. Ensure that you’ve chosen a solution that puts your privacy first.
  • You depend on your outsourced team to comply with security and regulatory measures. Have a look at some testimonials to understand how trustworthy the provider is.


Whether you have an out-house or in-house team, you’re there to make sure your departments are running smoothly and they’re there to make sure you know what’s going on.


Even being the boss, you will have to open your ears and hear what your chosen experts have to say.


But remember – do not take the wrong advice from the wrong person. Don’t, for example, take legal advice from your accountant and finance advice from your legal team. Both are, without a doubt, experts. But they are experts in their field.


And, although they’re experts in their field, they might need a hand to deal with all your business needs.


In Part 3, we’ll get into how technology can help with these varying departments. And we’ll take a glimpse at The Ugly!

 Now continue to final part of the article here

James Naylor

James Naylor is ITbuilder's Managing Director and Founder. He has worked in technology since the early nineties and, after a decade in the corporate world, went into business himself.

James has lead ITbuilder for over two decades, building the business into the force that it is today, but is still a technician at heart and still very hands on with tech.

Despite growing up in Hertfordshire, James lives in the Netherlands for five years as well as London, before returning and setting up the base in Hertford, where he lives today.

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