Sales Co-Sourcing VS Outsourcing

Sales are essential for a business. It can help determine the failure or success of a company. So, it is vital to find the right people to handle this aspect. While some companies choose to hire individuals and create sales teams, others decide to get outside help. That is where co-sourcing vs. outsourcing comes in.

What is the Difference Between Co-Sourcing and Outsourcing?

To find out which one is better for a company, it is best to know what these two concepts are first.

Outsourcing happens when a company hires an external party to handle specific tasks or services instead of running them internally. Generally, companies choose to outsource to find highly skilled people or teams to handle complex tasks that require strict quality control or even privacy. The external resource accomplishes specific work.

On the other hand, co-sourcing is often considered a type of outsourcing. But, it involves the development of a long-term relationship. It is similar to hiring consultants or contractors continuously, but the personnel becomes coworkers with the company employees. The external resource becomes an integral part of the team. So, they will be working along with the on-site staff. The accomplishment of tasks is dependent on both internal and external staff.

To further understand co-sourcing vs. outsourcing, it is essential to know the main differences between the two. Here are some that companies should be aware of:

Control

  • Outsourcing – There is no direct team assigned to the company. The service provider manages and controls the team to handle the client’s sales needs.
  • Co-sourcing – There is a dedicated team committed to the company. The client has direct control and can provide directions.

Quality

  • Outsourcing – In most cases, resource quality is next to none. The client cannot control. So, project quality and timeliness of results are not predictable.
  • Co-sourcing – The client has control over resource quality. So, there is predictability in terms of work quality as well as timeliness.

Standards and Procedures

  • Outsourcing – It may be challenging to implement and enforce the company’s standards, procedures, and methodologies since it does not control the sales team.
  • Co-sourcing – It is possible to convey and execute the company’s standardizations, procedures, and methodologies.

Ownership and Accountability

  • Outsourcing – Accountability and ownership are often transferred to the service provider or vendor.
  • Co-sourcing – Team members usually gain a sense of ownership. So, they have a certain level of accountability when it comes to successes and failures.

Business Value

  • Outsourcing – Usually, sales outsourcing does not offer prior knowledge. That means that an associated learning curve is expected for every new project. In return, there may be a time lag before the sales team becomes productive.
  • Co-sourcing – Since there is a dedicated team to a company, the staff can build up a knowledge base specific to the business’s operations, its products or services, and even its software and other tools. It also allows the external team to have a working relationship with internal resources.

Knowledge

  • Outsourcing – Since the service provider is the primary recipient of the organizational knowledge associated with the company, tacit knowledge can be lost even though knowledge transfer is possible.
  • Co-sourcing – The team gathers knowledge and learns firsthand. That means there are knowledge retention and leverage within the company.

Learning

  • Outsourcing – As stated earlier, there is a lag time in terms of the learning curve. The company needs to provide ample and relevant background information and inform the vendor of the company’s vision. This way, the team will be aligned with every new project.
  • Co-sourcing – Having a dedicated team prevents any additional time necessary to adjust to new projects or initiatives. That is because the team members get to retain learnings and have a deeper understanding of the company’s products and services.

When and What to Choose for Your Business?

Comparing co-sourcing vs. outsourcing allows a company to choose the option that is more beneficial to its business. Before making a decision, it is best to weigh the pros and cons of each. This way, you get to decide when and what to choose.

Both start from the same point, which is the lack of resources. Getting extra resources onboard can be expensive and time-consuming. That is especially through for short-term and one-off projects or specific tasks that require professional knowledge.

Outsourcing Pros and Cons

If the company cannot afford to create or training an in-house team, sales outsourcing is a good alternative.

Pros:
Most companies that opt for sales outsourcing get higher value for their money. They get access to a range of experts who can handle the sales strategies of the company. These vendors can be there as early as the development phase. The team will also have a deeper understanding of current best practices so that they can offer fresh ideas. They can also work to help the company achieve its goals.

Cons:
Not all service providers are the same. Some may focus on a single area, such as website design, branding, or advertising.

There are certain things a company should consider before choosing sales outsourcing. One of these is whether this option will work well with the business. Generally, any business can benefit from this practice. However, there are certain types of business entities that reap the advantages of outsourcing more often. These include the following

  • Tech companies
  • Startups
  • Those selling complex products
  • Companies planning on scaling in a new market

Before hiring a sales outsourcing service provider, it is also important to note that the most significant return on sales strategies’ expenses depends on good leadership. All relevant people should be on the same page to properly execute the sales plans of the company.

Co-Sourcing Pros and Cons

For some companies, co-sourcing is a better option. That is true, especially if the company wants to benefit from an in-house marketer while getting services and necessary resources from an external team. It is like combining the best of both worlds.

Pros:
Those that prefer a flexible arrangement will benefit from sales co-sourcing. The company will retain control over the work that they will have in-house and those they will get from external partners. There is no need to hire an entire team. At the same time, the company gains access to industry experts and sales professionals.

Cons:
While it does not happen often, there is a potential drawback. That is the risk of having a miscommunication.

Like outsourcing, sales co-sourcing can be done by all types of companies. However, it is more advantageous for those that want to grow fast and expand their sales capabilities. It is also helpful for those that have employees who want to learn more about sales but would benefit from seeing things from an outside perspective. It is also suitable for companies that want to maintain a long-term relationship built by trust and loyalty with their service provider.

Final Thoughts

The line between sales co-sourcing vs. outsourcing can seem a little fuzzy. Each one offers benefits. However, it is crucial to ensure that the option the company chooses is suitable for the company’s needs and circumstances. Whether it is through outsourcing or co-sourcing, the goal is to boost sales to have higher revenue.

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