How outsourcing can save you time and money (and the four key areas to focus on first)

If you’re thinking of launching a new nonprofit or you’re an existing small nonprofit, the temptation can be to try and do everything yourself. At a time where everyone seems to be focusing more on reducing overhead expenses and trying to raise more money with less, taking on every role yourself feels tempting. But even though running a nonprofit (or a small business for that matter) can mean you must acquire skills and master things you never knew you needed (PPE management, anyone?) learning how to outsource specific parts of your operation might just mean the difference between surviving and thriving.

Outsourcing strategic tasks can not only save you time and keep you from having to become an expert on international tax law, it can also be a cost-effective way of growing financially, particularly for nonprofits. While it might seem like a luxury to pay someone else to deal with your accounts and personnel, it can actually be more affordable in the long-term. For example, instead of going through a costly recruitment process to hire a full-time accountant, paying them a competitive salary (along with medical insurance and meeting your own corporate tax obligations), and investing in continuing education and employee training, you might find that outsourcing those functions is a wise investment that not only frees up some of your office space and financial expenses but also provides you with greater expertise at a lower cost.

If you’re thinking of outsourcing, consider focusing on these four key areas:

Marketing

There are plenty of companies out there who can help you evaluate your digital marketing strategies and find innovative ways to implement them at competitive costs. In many nonprofits, marketing tends to be the task that either the Executive Director shoulders alone (on top of everything else) or the area that gets split up among the team, including some with little or no marketing expertise. Neither of those is ideal. An executive director is far better served focused on ensuring the nonprofit is fulfilling its mission, cultivating and soliciting donors, and maintaining a high-functioning team. Splitting the marketing duties among the staff is an equally poor decision that often results in inconsistent branding, conflicting strategies, and fragmented campaigns focused on vanity metrics instead of strategic outcomes.

Before you outsource your marketing, it’s important to know exactly what you hope to accomplish. While raising money is the logical objective for nonprofits, it’s short-sighted to focus solely on that single metric. Instead, a well-rounded marketing campaign will aim to increase visibility in the community, recruit and empower ambassadors who share your love of the mission, and maximize the return on investment for each marketing channel. It’s also important to know your ideal audience and their behaviors before you reach out to potential marketing firms. While a great firm is going to help you identify several potential strategies, you’ll need to be confident in recognizing which ones are best suited for your audience.

So if you want to stay on top of the ever-changing marketing trends, and ensure that you have the maximum visibility when you need it, but it isn’t beneficial to have an employee solely dedicated to this role, then outsourcing your marketing could be the way forward. 

Finance

Nearly every nonprofit I have ever known has had some level of trouble with recruiting and retaining great financial officers. Finding someone with strong expertise in this area who is also willing to be paid on a nonprofit salary is likely one of the biggest challenges out there for nonprofits. That’s why outsourcing even a portion of your financial workflows can be a smart move. Not only can it save you a massive headache in terms of managing all the technicalities of your company’s finances, but it can also save you potential legal trouble later on.

Depending on where you’re based and what kinds of financial gifts you accept, different types of taxation and financial reporting will apply and inaccuracies in this area can lead to huge problems. Complicated gift taxes, international donations, and changing tax laws can all be challenges. But, this doesn’t have to be an all or nothing option. It might be perfectly feasible to hire a staff accountant to manage billing and gift income and still decide you need help with a guide to international payments or assistance with taxes. Whether it’s at a big or small level, outsourcing at least some of your finance department will mean that you have the expertise and guidance of trained and qualified financial professionals who will be able to answer all your questions and provide assistance where needed.

Personnel

Raise your hand if you thought all or even most of your staff would be working remotely for more than half of 2020. Anyone? Nonprofits, more than anyone, have been caught off guard with the rise of remote working and the demands it has placed on HR staff or the leadership team. If there was ever a time to consider outsourcing some or all of your personnel needs, this is it. While there are some who think that outsourcing your personnel department can lead to a loss of control and/or damage to the employee/employer relationship, this is generally not the case.

Most HR businesses will dedicate an agent to your specific organization, which means that you will be working with the same person every time you need support. This also means they will gain an understanding of your organization and individual needs, and be equipped to offer support if and when you need it. Personnel and human resources management goes far beyond the occasional scheduling conflicts, vacation requests, and even performance reviews. If your employees have medical concerns, maternity or paternity leave questions, or disability adjustments, these can be sticky situations to handle if you’re not also an HR Expert. Add on complicated laws and regulations, government mandates, or unforeseen court battles and you can quickly become consumed with management work instead of mission work.

In order to protect yourself, your organization, and your employees, it’s definitely worth considering outsourcing this element of your nonprofit or business.

Customer service

Customer service can feel like an odd term when it comes to nonprofit management but it’s a bigger component of your organization than you might think. Think about the volume of phone calls you receive, drop-in visitors, or email questions. Now, consider the training it requires to keep your office staff on their toes and ensure that every interaction represents your organization in a professional manner.

Understanding where to start when it comes to outsourcing your customer service can be daunting but it doesn’t have to be. There are plenty of companies out there who can handle part or all of your communication-needs, freeing up your own team to focus on more hands-on projects directly related to your cause. If you’re in a period of time where you need all hands on deck and want to streamline repetitive tasks or have access to a team of people who are already trained and capable of managing your phones or online chat needs, then outsourcing your customer service might save your nonprofit valuable time and money.

Whether you decide to let an outside firm manage your website and social media, hand over your accounting to a financial expert, outsource your HR needs, or let someone else answer that ringing phone after hours, outsourcing can be yet one more way to improve the bottom line on your cash flow statement. And every dollar saved in expenses is potentially another dollar you can invest in the programs or services your community is counting on you to provide!

Until next time,

Andrea