Outsourcing is one of the best things that happened to the business world.Unfortunately, not all company that outsource are able to fully benefit from it. Instead, some even suffer waste of time, money, and effort from the process.
Just like in any undertaking, there is a right way and a wrong way of doing it and this is true in outsourcing as well. Studies show that the most common reason for failures in outsourcing is in selecting the wrong provider. The mistakes in outsourcing can result to increased costs to the management of the outsourced processes, loss of control, and may even have a negative impact on employees’ morale.
Most legitimate outsource providers are very competent in their business but the burden often lies on the company that outsources. Even the best one can fail if the company that outsources ignores, or is not aware, of the proper practices to observe in outsourcing. Here are some of them:
- Establishing clear goal/s for outsourcing:
Sometimes, the outsourcing decision is made for the wrong reasons. Outsourcing is not the “cure-all” for a company’s problems. Your company, or its executives and managers, may have diverse or even conflicting goals. This results to incorrect or misinterpreted performance measures. Analyze the impact outsourcing has on the general direction the company is heading to. Outsourcing just for the sake of outsourcing can be very expensive and may hamper the company’s growth.
- Defining the tasks to outsource:
Analyze which tasks to outsource. If your primary goal is to save money, then start with the applications that cost you the most money. Identify if the tasks require high core competency or just routine, although vital, processes. This will avoid you from paying for over or under qualified assistants. It is important to get data such as the number of your in-house employees doing the tasks, quantities manufactured or work done, production cost, and even benchmarks of top performers. Determine also the nature of the tasks, whether they are continual or seasonal. Awareness of these data enables you to make a good analysis of the possibility of the outsourcing initiative.
- Determining the performance impact of outsourcing:
Have an accurate assessment of the benefits of outsourcing on the company’s bottom-line. Study details supporting every benefit such as factual data, reasonable assumptions, performance indicators, timeframes, etc in order to help you come up with quantifiable financial impacts of outsourcing. - Get a compatible provider:
Based on the above factors, look for a service provider that understands your company’s culture and business objectives. This can be done by being candid to your outsource provider. It will difficult for your partner to meet your expectations if it is not familiar with your business culture and ultimate goals. Your outsource provider is not just another of your suppliers but it becomes a part of your company. The assistants it provides your company must fit in to your organization like the rest of your staff.
Also, look into its tract performance and working style to avoid future work conflicts.
- Having the foresight:
Rather than focusing on the immediate benefits outsourcing can provide you such as lowering expenses, attractive terms and conditions, etc., look on the long-term results and see if it justifies the switch in your business operations. Do not hesitate to terminate your contract with your outsource provider if you realize you do not get the results you expect from your partnership. - Retaining responsibility:
Your control of your company should not end with the signing of contract with your outsource provider. It should not mean the abdication of your responsibilities with your company. It is very important that you are on top of the situation, especially where management is concerned. Keep yourself involved in working with and management of your outsourcer. Do not delegate everything to middle management like your outsource partner.
- Maintaining close coordination:
This can only be possible with close and constant communication between your company and your outsource provider. When you delegate functions outside your company as with the virtual assistants, closer coordination and constant communication is vital. You do not want to be caught flat-footed when things go wrong.
Also, regular coordination will assure you that you get your money’s worth in terms of quality of service. Sometimes, outsourcers cut corners due to cost pressure and use junior resources with less satisfactory results.
By considering these outsourcing practices, your company can gain from the benefits of the process in terms of increased and better performance.