Millennials who are savvy about expanding their general management skills should consider important but often overlooked areas: contracting with outside suppliers for customized goods and services, and outsourcing of services previously done in-house.
Millennials, the generation born roughly between the early 1980s and mid-1990s, have been generally fortunate in their timing for starting their careers. Those born before, say, 1993 have benefited from relatively low U.S. unemployment as the economy steadily recovered from the financial crisis. As they move into their second or third jobs, their fortunes are rising with opportunities generated by an economy that is booming—at least in some places.
A positive trend for millennials is the long-running wave of tech startups financed by seemingly unlimited amounts of venture capital and other early-stage funding sources, which shows no sign of abating. Tech startups and other early-stage companies continue to hire a steady stream of millennials, many of them liberal arts graduates whose training in creative thinking and communications turns out to be particularly practical in high-innovation settings.
But now, as millennial employees look to the future, many see the need to broaden their business skills. This might lead some to pursue an MBA or other graduate degree. Others who are willing to seek out special projects or make a lateral move will find plenty of opportunities to expand their capabilities on the job.
“Being part of an initiative to outsource what the company has previously done in-house and leverage scalable infrastructure will get younger employees involved in helping a company grow more nimbly and profitably.”
One step that millennials should consider for their personal business development is pursuing hands-on experience in contracting and outsourcing. Contracting for goods and services is how almost all business ultimately gets done. That cool, disruptive technology that your startup sells? It was created by a value chain consisting of thousands of suppliers spanning the globe. Each supplier was selected over its competitors via rigorous vendor-selection processes that looked in detail at, for example, how well the supplier can meet its customers’ longer-term technology and business direction.
Contracting experience will be particularly useful for millennials who wind up working for a smaller company or freelancing. Today’s sophisticated contracting processes include:
- Modeling the current baseline state
- Visioning a new future state
- Determining the use case for services to be procured, and their scope and specs
- Building in flexibility for contractors to modify their services as requirements change
- Designing defensible vendor-selection processes
- Writing contracts with suppliers that ensure they meet minimum standards and incentivize them to exceed expectations
A related area to look into is outsourcing. Many companies today embrace the mantra that they should do in-house only what directly leads to differentiation and creates a competitive advantage. Being part of an initiative to outsource what the company has previously done in-house and leverage scalable infrastructure will get younger employees involved in helping a company grow more nimbly and profitably.
It’s time for millennial employees to get an edge by building skills in contracting and outsourcing. It’s an investment of time that could pay off in their future careers.
This article originally appeared in the July/August 2018 issue of Middle Market Growth. Find it in the MMG archive.
Donna Astramecki is an Insperity business performance consultant with 21 years’ experience that includes assisting executives to evaluate the impact of HR issues on their investment strategies, M&A, spinoffs and exits. Visit www.insperity.com/acg for more information.