Management should look for ways to outsource activities which are outside the company’s in-house expertise. When a company recognizes internal business processes are being done, which are not part of the core business, alternatives should be considered for improved efficiency.
The core business is that which supports the company’s reputation. It is how the company is known and recognized within the market it participates. The core business establishes the primary activities that a company focuses through its in-house expertise. When new employees are hired, the skills pursued are those that will support the core business. In addition to determining the skills and expertise of its employees, the core business will often times establish the entire culture within the organization. The culture will naturally develop from the people who have the required skills to perform the core business activities.
A business should outsource those activities that are not within the realm of the core business. However, a small business can sometimes find itself performing activities that are not within their area of expertise. This situation can occur because there is so much to do and so little time to do it all. Even though there may be recognition by upper management that activities are happening which are not part of the normal business, decisions are not made to take the steps to outsource those activities.
As long as a company stays focused on its core business, the business will run efficiently and more cost effectively.