Internal External Development: Production Trade-offs

Date Published: 12th of May, 2024

Internal External Development: Production Trade-offs

When building anything, trade-offs between options must always be made. The selection of choices made or not ultimately forms the unique product or service. How then, can one confirm that the selections made will produce the same result if repeated. What if better results were possible?

Within this post you'll read our decision-checks which helped bring Internal External to where its operating and production process steps are known, reviewed for internalization (upskilling / timeblocking) or externalized (delegated/outsourced), and how you can apply these learnings within your own creative projects.

Part One: Getting everything out and documented.

Before changing which parts remain internal or become externalized, its mandatory to take stock of each step and stage to begin with. Often when undertaking new tasks, we simply try and do, which although important to execute, can rob us of valuable information to improve the process and make those decisions.

From here, are these important tasks trainable, repeatable in the foreseeable future, and automatable? 

Part Two: Internal or External?

Externalizing is taking a task or activity that is currently being completed either by the self or within the organisation, and delegating it outside.

Internalizing is the opposite, whereby tasks previously undertaken outside are completed inside the organisation.

Externalization frees up time to focus on other activities, tasks that you're more skilled/efficient in, or output with greater expertise. Often is achieved via an exchange of value, often monetary. At times services can be exchanged like for like, but this often takes a mutual understanding of expertise gaps between entities.

Communication is even more crucial when externalizing as its not as frequent when comparing against the same group or organisation. Additionally, there are cut-off points that an activities progress cannot be reversed after progressing past, unless large costs or time delays are incurred. Ensuring you've both the same record of progress, and a detailed understanding of acceptable quality, timelines and costs will provide more time back into your own business.

Internalizing provides the largest benefits when a frequent task/skill which was completed outside has been brought in. The two main ways that this takes form are up-skilling or bringing in new talent to undertake these tasks. The shift can free up funds to allocate elsewhere, allow greater control/ reduce communication restrictions and ultimately, make progress at a dedicated pace instead of external skills which are often working with other parties. A large benefit depending on the project and IP being worked on is that internalizing keeps the talent from using this new experience elsewhere, where if they were external, usage limitations and knowledge sharing is harder to eliminate, irrespective of NDAs.

Part Three: An example

An example of how these apply for Internal External is through our exploration of the garment manufacturing process: Which is the better option?
- A manufacturer to create the garments in larger quantities,
- Outsource a smaller maker, providing a space to operate with lower quantities,
- Hire someone on the books for part-time manufacturing, or at the larger extent of internalization,
- Upskill and undertake production as an individual.

Each consecutive option may require lower upfront funding, but more time to upskill and accept the individual risk instead of externalizing and paying for.

Especially when starting out there's new activities and functions which haven't been undertaken before. From Product Development, Marketing, Logistics, SEO, the list can go on and on. Taking note of these activities and being honest with whats realistic to undertake now and in future, opposed to externalize for completion or internalize through the different methods will be the difference in continuing to refine your offering and expertise. As long as there is progress, there is progress. 

Within my business, I was previously time-short whereby I wasn't able to juggle Graphic Design, Product Manufacturing, Fabric Sourcing, Packaging, SEO etc.
It became imperative to take stock of what was being attempted, and externalizing what was being struggled with most in order to free myself up for the tasks I was better at.

In conclusion, we've explored some questions to ask when reviewing your current activities and if they're in the right place being either internal or external.