Outsource or Hire? How to Decide

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It might be HR or marketing, bookkeeping or design, but you need to be able to hand over some piece of your business to somebody else. The question is,

Outsource or hire. You gotta get somebody in here

Outsource or hire. You gotta get somebody in here

do you outsource it? Or do you hire somebody? Fortunately, there are some pretty good tests to help you figure out the right answer. For example, do you actually need the person to do this day in and day out on an ongoing basis? Or do you just need someone periodically or for a short time?

Here are some other factors to look at:


Depending on who you choose, outside consultants can be expensive. They’re experts and you’re paying for that expertise, which usually means the job will get done faster. But their hourly is probably a lot higher than you’d have to pay an employee since they’re paying for all their ancillary costs. On the other hand, hiring an employee means paying not only a salary but taxes, benefits and providing office supplies and equipment and the extra pizza and beer.

Time Investment

This could go either way. If you hire an outside contractor, that person or company won’t be on the inside and know as much about your business. But, being contractors who do the kind of work you need, there’s a lot they will know that you won’t have to explain. If you hire an employee, you’ll probably have to train him or her about the company and the job. Speaking of training, you won’t have to train a professional consultant once they understand your company systems and culture. You will have to train an employee, but you’ll wind up—in theory—with an employee who will be a huge asset to your company. There’s better ROI on training an employee.


When you hire a contractor or consultant, everything is laid out in the beginning and changes can be costly. When you hire an employee, you can change direction every day of the week, add tasks, and scrap the whole project. The cost is the same, except you might have one frustrated employee. With a contractor, too you don’t really get to provide oversight. Or, to look at it a different way, you don’t have to spend the time and trouble on oversight. You can just say “Get er done” and they should do it. Sometimes that happens with employees, too.


Okay so Edward Snowden aside, it feels safer to have an employee who has signed all kinds of non-compete agreements or has golden handcuffs or is somehow under your control. But there are non-disclosure agreements between companies and their consultants as well. If the consultants didn’t honor them, they wouldn’t be in business long.


Commitment is a two-way street. If you hire an employee, you’ve committed to that employee and he or she is likely committed to your business. But in reality, an employee-at-will can leave at any time, whether the work is done or not. And if you hire somebody who isn’t really committed, your only recourse is to fire the person and start over again.  Your commitment to a contractor only extends to the end of the project. But the contractor relies on his or her reputation with clients to keep business alive so the quality of work is important. The contracting company’s commitment is to its own success which means it isn’t likely to bail before the work is done.

You could even assign each of these factors a number of importance. Like, does the idea of handing the project over and going to do something else rank highly on your priority scale? Or are you a big iterator who likes the flexibility to make changes? If you could use help figuring out which is more cost and time effective for your company before you take the plunge in either direction, call us. We work with companies on a project or retainer basis, giving you just what you need when you need it.


We work with companies on a project basis or on retainer, providing a custom level of HR help designed for your business, with offices in Austin, San Antonio, Dallas and Houston. Contact me at Caroline@valentinehr.com or call (512) 420-8267.