Insource or outsource: the secret sauce of resource

Once you get past the Dr Seuss headline, there’s a serious question here. It’s also a hot topic right now. When big business is scouring every budget line to trim a little fat, many of them ask, “Can I save money with an in-house studio?” I reckon the answer is “maybe.” Having worked in big agencies, smaller ones, digital shops and in-house, here’s why I think the answer is “horses for courses.”

1. Not all apples are apples.

There’s more to driving a Mac than finding the mouse. Design is a craft and needs talent. But not all talent is equal. Some designers can look at a job, understand the brand and make anything sing like a canary. Others, not so much. But if a job is all about attention to detail, it’s likely your creative designer will over-think it. So the secret is knowing who to use on what. With a big enough talent pool and quality managers, an in-house studio can do this as well as anyone.

Outsource: 1               Insource: 1

2. Apples grow best in orchards.

Creativity is fostered magic. Creative people are like sponges who suck up their environment, juggle it, re-dream it and spit it out in the right way at the right time. That’s why agencies spend so much time (and money) developing a ‘creative culture’. It’s like fertiliser and it’s vital. Good in-house studios understand this. But none that I’ve visited have pinball… yet.

Outsource: 1   Insource: 0

3. Chinese walls and Chinese whispers.

Many agencies shelter creative people from clients to maintain the mystery and magic of the creativity. It works. But it also makes the briefing process longer and a whole lot harder. How often is it easier to sit down with the person doing your job, knock it around and leave them to craft it up? Agencies aren’t there at all.

Outsource: 0   Insource: 1

4. Thinking outside the box you work in.

The biggest advantage of an agency is that they don’t understand their clients’ business. They’ll say they do. And mean it. But it’s better when they have fewer clues so they’re not derailed by detail or lost at the lake fishing for red herrings. That clean sheet of paper, customer-centred thinking is difficult—maybe impossible in house. Problem. Clarify. Simplify. Sell: agencies win hands down.

Outsource: 1   Insource: 0

5. Money can’t buy you love.

Any business, agency or client is only as good as its talent. And there’s no question that the best agencies attract the best talent. It’s self-fulfilling and cyclical. But funky furniture, award opportunities and an open bar can often be offset by work/life balance and a few extra perks. I reckon this comes out even.

Outsource: 1   Insource: 1

6 When something costs nothing, it’s worth less.

A big challenge for internal studios is perception and reality around value. When you buy from an agency the ‘product’ has value before it’s even briefed. The brief gets more love, the work more respect and the end result is usually judged as ‘better’. By comparison the single input, single output nature of internal studios gives them a handicap before the gun goes off.

Outsource: 1   Insource: 0

VERDICT: Outsource 5: Insource 3

But the bottom line is the bottom line.

Agencies are expensive. There’s no getting away from that. But building in-house resource to deliver at the right level is certainly not cheap either. Some businesses are doing it well: SkyCity and Telecom are two great examples. But neither just bought Macs and thew them into a room with some artists. Instead they bit-the-bullet, hired agency consultants and structured their in-house shops like agencies.

Not every business can do that, which is good news if you’re working with smaller clients. But corporates can and many of them are—and that has the big boys scrambling.

That’s why I reckon anyway. What do you think?

  • Michael Goldthorpe is co-owner of hunch. They’re a hub and spoke thinking shop working collaboratively (in-house and out) with some of New Zealand’s largest corporates. Find them at hunchthinking.com

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