Outsourcing is here to stay.
There are various reasons why businesses may choose to outsource. Some
outsource with an eye on maintaining their competitiveness through
cost-effective operations. Some other businesses outsource operations that
might be too convoluted for their staff to handle.
If you want to outsource your
business operations like others, it is not difficult to hire a third party
service provider either domestically or internationally to take care of your
business needs. However, remember that you would be handing over your
operations, along with confidential information and exclusive business practice
records, which could impact your clients, competitors and other stakeholders.
Therefore, it is imperative that your business processes are handled
efficiently when they are outsourced.
How Can You
Improve The Effectiveness Of Your Outsourcing Arrangements?
1) Making A List:
It is critical
that you make a list of the operations that you would be outsourcing. It could be
invoicing, payroll, digital marketing, tech support, or customer service or all
of them. This would give you clarity as to which operations you would still
need to handle and this would also help in more effective resource allocation.
2) Consider Relevant Providers:
Look at all the
relevant proficient service providers in the market who handle the operations
that you want to outsource. Check their track records: the list of successful
clients they have serviced, the list of successful projects they have executed
and the time taken to complete the project.
3) Compare and Choose:
Go through the
proposal of the service provider in great detail. Apart from comparing the
associated costs, read all terms and conditions and look at the kinds of
services offered before choosing a service provider. Conducting a comparative
analysis would help you in coming to a better decision on your outsourcing
4) Go for a Trial Run:
A trial run is
an effective way of evaluating the ability of the outsourcing company to handle
and deliver the work expected from them. So before settling down on a
particular outsourcing vendor, ensure that you get a trial run done. In the
trial run, the provider will recruit employees, set up the technology,
negotiate vendor contracts and decide on shift timings. At the end of the trial
period, you will evaluate whether the deadlines and targets have been met. The
trial run would showcase any potential problems. If such problems are
uncovered, you can analyze them and ask the provider whether improvements can
be made. If the outsourcing company is unable to provide suitable solutions and
fails to fulfill your expectations, you can choose another one.
5) Set up a Monitoring Team:
You need to
create a team to liaise with and monitor the outsourcing company. This team
would answer queries, check reports submitted, follow up on missed targets and
deadlines, and deal with any other issues as regards the outsourced processes.
It would be best to include the senior members of your company in this team as
they would know how the operations need to be handled and what are the desired
6) Proper Documentation:
Make sure that
every part of the service level agreement is documented and that nothing is
left undocumented. The paperwork should be as comprehensive as possible and
should clearly delineate accountability and responsibility. Outsourcing can
sometimes lead to legal conflicts owing to carelessness in this regard; hence,
your business should take appropriate steps to optimize the process.
7) Transfer Accountability:
Make sure that
the outsourcing service provider takes complete responsibility and
accountability for the project after a certain period of time. Your staff
should be relieved from monitoring duties and the handing over needs to be smooth
8) Track the Performance Reviews:
reviews of the service provider and the services rendered are crucial. In case
there is a shortfall, you must ensure that it is rectified by the service
provider as soon as possible. Establish Key Performance Indicators (KPIs) and
metrics to facilitate assessment.
9) Regular Communication:
Conduct regular conference calls with the service provider where all issues are raised, clarifications and explanations are given, and information passed on from one to another. This will minimize interruptions and resolve conflicts even before they arise.
In summary, outsourcing your business processes to a competent and experienced outsourcing service provider can streamline the manner in which a process is implemented, boost internal productivity, provide cost savings and enhance your competitiveness. However, this would require amongst many things, adequate foresight, planning, attention to detail and regular reviews. Doing all this can help ensure that the whole outsourcing process is satisfactory for you and profitable for your business.