The Outsourcing Paradox - Part 1

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So you're ready to get your Web site built and you want to hire someone who can do the job right within the budget you have. You decide to try outsourcing to find a programmer.

Often the idea of outsourcing is equated with the idea of an efficient system – the fastest, most efficient way to find and hire the best help within the budget available.

Sites like getafreelancer.com, odesk.com and guru.com are easy to get started on. You can do a bit of due diligence and comparisons, post your projects, and start receiving bids almost instantly. But once you start reviewing those bids, you might soon find that mastering the outsourcing game is a little trickier than you thought.

Case in point: a posting was done recently for a freelance programmer. Included in the posting was a job description, a set of instructions (as in, send links to your work, indicate what time zone you're in, provide your contact information). For those who made it past the first cut, each candidate was provided a set of identical tasks and asked to provide a time and cost estimate.

Here were the results:

  • Initial Replies - more than 50 initial candidates replied. Unfortunately 48 (or 96%) of the replies were generic "throw it against the wall" replies that had no bearing on the post and did not follow the instructions.
  • Follow up – each candidate was sent another email asking that they follow the instructions in the first email
  • *Real Replies* - this time 15 of the 50 candidates (or 30%) responded with their details and all of them were invited to provide estimates on the list of tasks.
  • Estimates - 6 of the remaining 15 candidates (40%) responded with estimates. I'll detail the estimates below.

The process up to this point required:

  • 4 initial postings
  • approximately 70 follow up postings emails and replies (since communication had to be done one at a time with each candidate, "mass" responses were ignored)
  • approximately 15 hours between reading and writing responses, devising the list of tasks to estimate, and working with slow and somewhat clunky freelancer Web sites.

Here's where it gets particularly interesting. In the end the exact same list of tasks received wildly divergent estimates.

The lowest estimate: $450 for 15 hours of work. The highest estimate: $5,210 for 289 hours of work.

I kid you not. The exact same tasks procured estimates with a gradual variance of more than 250 hours and almost $5,000.

At this point after so much time spent and such wildly differing results, many a business owner would throw up his hands. How can this be so complicated, time consuming, unpredictable and hard to evaluate?

Herein lies the paradox. Many small business owners try to use the method of casting a wide net to hire a technical person, but don't realize that if you're going to do that, you really need some technical expertise just to get through the process, know who to hire and then get the most out of the relationship.

So now that we've had a chance to see what an outsourcing project response might look like (without you having to spend 15 hours to find out), next time I will break down the four things you'll need as a non-technical business owner, to get you through your next technical outsourcing project.


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Last updated: Dec 11, 2008




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