The best-run companies don’t try to do everything in-house. That’s not a gap in capability but a deliberate allocation of attention. In 2024, 80% of executives surveyed reported plans to maintain or increase investment in third-party outsourcing. Every hour a CEO spends managing a function someone else could handle better is an hour pulled away from decisions that actually require them. Outsourcing is how the majority of serious operators are running their businesses. Here’s what they typically CEOs outsource:
1. IT and Cybersecurity
77% of business CEOs outsource IT functions, and 93% of organizations planned to CEOs outsource parts of their security operations to external vendors over 2024 and 2025. The threat landscape moves faster than most internal teams can realistically keep up with. A ransomware variant that didn’t exist six months ago can cripple operations today, and the sophistication of attacks targeting mid-market companies has grown considerably, making this bigger than just enterprise problems.
Building a world-class security function from scratch requires the right headcount, tooling, certifications, and institutional knowledge, all of which take years to properly assemble. Outsourcing means accessing that depth of capability immediately, and in most cases, for a fraction of what the equivalent internal infrastructure would cost. For most businesses outside of tech, cybersecurity is not a core competency, and pretending otherwise is where the risk actually lives.
2. Legal and Tax Functions
Most in-house legal teams spend the bulk of their time on routine work like contracts, compliance reviews, and regulatory filings. Specialized external firms handle this faster, often better, while internal counsel focuses on higher-stakes matters. The same logic applies to tax. Law changes constantly, and the value of a firm that tracks those changes across industries versus a single in-house person doing their best is harder to quantify, but it is very real.
3. Investment Management
Growing businesses accumulate capital through operations, liquidity events, or cash reserves and then manage it in ways that don’t reflect their actual investment sophistication. A founder who is brilliant at scaling a product is not necessarily well-positioned to make active portfolio decisions on assets now running into the tens of millions.
However, that’s exactly what happens when there’s no dedicated investment function. The capital sits in suboptimal allocations, or gets managed by whoever on the leadership team is most financially literate, which is a different thing entirely from being a skilled investment professional.
This is where an outsourced CIO makes a concrete difference, especially if you work in the non-profit sector. Rather than leaving investment decisions to committee instinct or quarterly board reviews, an OCIO provides continuous, professional investment oversight without the cost and overhead of a full executive hire.
4. HR and Payroll
Payroll compliance, benefits administration, and recruiting infrastructure are areas where specialist providers have built systems that no single company could justify replicating internally. The risk calculus alone makes outsourcing attractive.
A payroll error or compliance failure costs far more to fix than it would have to prevent. This doesn’t mean outsourcing your culture or people strategy. It means being honest about which parts of HR are genuinely operational versus which parts require human judgment that only your team can provide.
Endnote
The instinct to keep everything internal feels like control, but owning a function you’re not equipped to run well isn’t control; it’s just ownership of the problem. The question worth asking is whether each part of your business is best served by internal talent or external expertise. The answer, more often than not, is the latter.
