Improving the Effectiveness of Your Outsourcing Arrangements

Outsourcing is a great way of ensuring the job gets done at a cost that is most favourable to your business. You can discuss what needs to be done, how it will be done and the timeframe within which it will be done.

Outsourcing is the new way of doing business. It frees you from labour laws, wage agreements, wage regulations and so forth. Also, since most of the businesses providing these services are based in Asia, there is a huge advantage in costs.

As with everything, outsourcing companies have their pitfalls. Including runaway costs and deliveries that weren’t what was expected. Most of these happen due to lack of communication and planning. Here’s how you can improve the effectiveness of your outsourcing arrangements.

Figure out what you need done and how much it would cost you locally

Knowing what exactly what needs to be done is half-way to successful and effective outsourcing. Next, find out how much it would cost you to hire locals to get the job done. Factor in minimum wages, bonuses, insurance and other perks. Doing this will ensure you know how much you will save when you select the outsourcing provider you will work with.
Start with making a list of service providers

Without exception, all outsourcing service providers have websites. Google your requirement and see how many of them match your needs. Short-list a few.

Consider Relevant Providers

Have they been providing services that you need? Are they willing to share references?

Compare and Choose

Do they have a pay-as-you-go agreements? Are their terms transparent? How do they communicate? Consider creating an Excel Chart so you can compare outsourcing providers.

Go for a Trial Run

If your needs are long-term, consider a trial run. It needs to be of sufficiently duration so the provider has time to familiarize with your specific requirements.

Set up a Monitoring Team

If the work you are outsourcing is large enough, consider hiring someone locally (or delegating responsibility), so as to monitor the performance of the outsourcing team.

Plan for changes in advance

Would outsourcing mean that you will eventually need to issue pink slips to some of your staff? Or, would the way you work change? If so, some advance planning will go a long way in smoothening out the transition.

Proper Documentation

Chatting on the phone or video conferencing is great but document everything. Better still, ask the service provider to send you a document that includes terms that were discussed.

Transfer Accountability

Sometimes, the service provider may unintentionally do things that could result in financial liability for your business. Make sure these areas are covered in the terms you set.

Track the performance reviews

Read the reviews that your monitoring team provides you. Reading those reviews within a day or two of them being produced ensures you can catch errors and rectify them quickly. E.g. The service provider may do something unintentionally that violates your local laws.

Regular Communication

Make your self available for regular communication. Even if there are no issues, it helps build a repo with your service provider and goes a long way in ensuring the effectiveness of your outsourcing arrangements.

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