Here’s a checklist when you have finally decide to outsource:
- Acceptance to work culture
Most employees think that outsourcing is a means to end their job. They are threatened with the idea that if the outsourced person or groups will do better, they will eventually be terminated. In –house employees and the employer should have the same understanding of why the company is considering to contract. Explain also the goals of the company that can only be met with the partnership. Without a common understanding, your employees might go against the company and decrease productivity. Assuring them about their tenure would also be a good idea. Outsourced partners are not a competition but partners in building a better business.
- Is outsourcing for you and your business type?
You have to understand that although it covers a lot of ground, outsourcing is not for everybody. This business strategy might not be for you for many reasons. Most business owners are impatient. They want results as soon as possible. When you offshore, information takes time to get to you. Statistics of the results will also take time reaching you. Business owners also alarmed at the fact that they will provide private information. If you have data privacy and confidentiality issues, contracting is not right for you. As the employer, you should remember that you are not giving up the liability towards the project. Contracting will only assist you with the given task. The responsibility still comes from both parties.
Some tasks cannot be sourced as well. These are jobs that are so complex that it can be delegated. You can also be stretching your Return of Investment (RIO) because you did not do a comprehensive cost and benefit analysis. It can also damage the company’s reputation. If you have promised your customers a personal take on the job, you can expect them to agree with the idea of outsourcing. You could lose your customer’s brand loyalty as well. It is said that “outsourcing for the sake of outsourcing is not a good idea”. Therefore make sure you have considered all aspects.
Successful projects require extensive studying. If you think you still lack knowledge about outsourcing, many available materials will help you understand what it truly is. You could also research how it will and will not affect your business. It will also help you understand different perspectives when you talk to people who have experience in outsourcing their business. Planning to offshore requires more research. You should also be knowledgeable of the corporate culture of the country in which you’ve chosen to contact. Understand their labor laws and other local policies. Research always goes a long way.
- Clarify your business goals
Having a clear business goal will help you understand your motives and your plan in the long run. You can pattern your plans from other businesses but not always the same for all. There is no one size fits all business strategy you can use. Some businesses would want to build a long term partnership and others would just need help in the meantime. Identifying which one you will need will convey what you want with your offshore partner. If you have existing goals, you can use them or innovate to provide the results you want or better. Some offshore partners offer a more tailored fit approach towards dealing with your business. Helping your goals create deals that will suit your needs.
- Choosing the right partner
This is one of the most important decisions you would do if you decide to outsource. Choose a firm that believes in your goals and understands your company’s needs. Choose a firm that you trust and you will be confident working with. There is a wide range of outsourcing firms you can choose from. This is both locally and internationally. To help, you can look at the current accounts they have and how they have handled that. You can also look at the results of those projects. Deciding where to outsource is also important. For lesser cost and a long time of service, you can offshore to other countries. They might be able to provide a 24/7 service and it will cut you the cost. Asian countries like India and the Philippines have developed a better system for outsourcing which can be more efficient. You can also ask for a request for proposal. This is a form that allows potential partners to advertise services being offered. You can use these as references in choosing which among them is better aligned with your goals and needs.
- Prepare all the necessary documents
It’s necessary to prepare documents such as legal contracts and confidentiality clauses for your protection as an investor. A service Level Agreement is a contract, in writing, that sets both parties’ obligations under their outsourcing arrangement. It aims to legally protect both parties. It includes the responsibilities, the basis for compensation and the starting and ending point of the relationship. In doing it you have to consider the culture and organization of the service provider. Scrutinize and define clearly every commitment in the SLA. It’s good to cite what measures will be used in evaluating performance and compensation. Find out about local data privacy protection laws so you could also use it as a legal basis.
Measuring successes and failures within the span of the partnership is important. It will tell you if you are doing well and what the points for improvement are. You can use certain measuring techniques such as metric, ratio, relative amount, fixed amounts or comparatives. You can also use benchmarking – a standard against which something can be measured. A timeframe for improvements should also be established. Measures can also determine profitability and wealth sharing and provide rooms for improvement. It’s also a good factor in deciding whether or not to continue to outsource or not.