Outsourcing Back Office Services: A Smart Move For Growing GovCons
Whether you work solo or in a large GovCon operation, competition remains constant and intense. GovCons continually seek an elusive competitive edge, perhaps in the form of larger sales teams, new lead generation systems, or broader business networking. However, many GovCons overlook the option of improving their own business structures, especially those related to the back-office.
Accelerating the Back-Office
Business leaders worldwide have long recognized that prudent outsourcing of back-office services reduces operating costs and increases efficiencies. The concept first gained wide attention following a groundbreaking study published by the Harvard Business Review.[1] For GovCons, implementing the idea is worth consideration.
Bundled in with general and administrative (G&A) expenses, back-office costs are high and rising. Every GovCon organization would like to cut costs and boost sales: Your back-office is an excellent place to begin.
What Services are in a GovCon’s Back Office?
The back-office is an essential part of any business, including one that focuses on GovCon. Though generally unseen by customers, the operations team handles critical elements of your enterprise, including:
Despite its strength and support services, the back-office usually has a few challenges, including:
- High operating expense: Costs remain high and static regardless of sales and business activity levels
- Endless outlays: You pay for full support even when you don’t need it
- Insufficient staff: When things get busy and sales are hot, the back-office is often understaffed. The situation increases the risk of losing sales, customers, or both.
For smaller GovCon operations, back-office expenses may be relatively low. Regardless, you still have the option of outsourcing back-office jobs as your business grows. Having better control over your back-office costs increases your bottom line and focuses your efforts on closing more sales. We’ll get to more of this good stuff in a moment.
Benefits of Cost-Effective GovCon Back-Office Services
You can address many back-office shortfalls with outsourcing, even as you improve your bottom line and business performance. Outsourcing back office services for GovCons can also yield an excellent ROI.
Here are some additional ways in which outsourced consultants can outperform a traditional, full-time, in-house back-office:
- Outsourced talent is scalable: Access only the staffing you need – only when you need it
- When demand for back-office services drops: Outsourced talent can incur less expense for your business
- Outsourced consultants respect your business processes: They also have the experience and objectivity to suggest improvements.
While outsourcing is not a hardline proposition: It’s possible to outsource part or all of a GovCon’s back-office services. Compared to its in-house counterpart, a fully outsourced back office can save 40% or more on G&A expenses. If you prefer to maintain a full-time back office, you can still augment staffing during busy or surge times – and save money in the process. Outsourcing can help grow your business. How? We’re glad you asked. Before committing to hire a full-time position, fill the job with an outsourced consultant first. It’s a great way to help you make an informed decision – without paying full-time wages and associated costs to determine what your business truly needs.
Advantages of Outsourcing A GovCon’s Back Office Services
When your back-office is partly or completely outsourced, you’ll begin to observe some new benefits in your organization:
- More time to pursue and close more sales
- Lower overhead; less expense for payroll and benefits
- Staffing based on your needs – not on a full-time payroll
- Opportunities for business growth
The Top 3 Signs You’re Ready to Outsource
Whatever your GovCon enterprise’s size or age, here are a few signals that you may be ready to outsource right now – or at least sooner than later:
- You find some aspects of your job responsibilities exceed the boundaries of your role
- Your organization is doing too much work that does not focus on its core competencies and profit centers
- You feel comfortable with the concept of delegating responsibility to a trusted, outsourced consultant
Choosing the Right Outsourcing Partner
To start, look for a company with years of experience specifically in the GovCon consulting and outsourcing field.
Lisa Linden, BOOST’s Chief Operating Officer notes that “Outsourcing is a partnership built on communication and trust.” That’s an excellent perspective to keep in mind as you proceed through the vetting process of various agencies and consulting firms. Here are a few things you can ask during your process for interviewing potential back-office partners:
- Ask about fees and the ability to work within your budget
- Request references and work samples
- The firm you retain should have the talent available in the fields you specifically need, such as accounting, contracts, HR, and so on
- Discuss ROI: Your outsourcing investment should yield payback
- Seek a firm that shares your perspectives and values on improving your business interests
The back-office is an ideal place to implement outsourcing services that can benefit your entire GovCon business. After selecting an outsourcing partner, remember to keep communication channels open and honest. If you or your partner have problems, questions, or kudos: Share them. In your client-consultant relationship, you’ll work together toward the common goal of making your GovCon enterprise excel.
To learn more about how BOOST can help to support your business in Accounting, Contracts, HR, Recruiting, or Strategic Pricing, email [email protected].
We look forward to watching you grow!
[1] “Make Your Back Office an Accelerator,” Harvard Business Review, March 2007
About BOOST’s CEO, Stephanie Alexander
Stephanie Alexander has spent more decades than she wants to admit supporting high growth government contractors with an eye towards their bottom line. She is the CEO
