7 steps to successful outsourcing

The concept of outsourcing was in its full glory in the early 21st century. But then, things slowed down. The impetus for this was the failure of crucial projects. Such stories discourage others from outsourcing even till this day. However, if you know how to execute a successful outsourcing project, the benefits that can be reaped, are very enticing. So, here are seven of the most effective steps for successful outsourcing–

  1. Know the suitability of Outsourcing– This is the most crucial step and hence, should be first on your list. You should put considerable amount of thinking in deciding whether the project in consideration is really suitable to be outsourced. As a rule of thumb, you outsource projects which don’t directly relate to your core functioning. Say, if you are in the textile manufacturing, outsourcing your IT needs is a really good idea. But, nothing which directly affects your competitiveness in the market should be outsourced.
  2. Choosing the Right Vendor– Now, ‘right’ vendor isn’t always the one who offers the least quotation! Look up vendors who have formidable portfolio. Experience is really very important when it comes to outsourcing big projects.
  3. Create a detailed Plan– A project is ready to be outsourced if it has a detailed plan. Without a detailed planning, it’s impossible to keep coordination between the in-house and outsourcing team. Hence, outline every important step and with special highlight on deadlines and expected results.
  4. Establish an effective communication mode– Emails are suitable only for initial work instructions. But, for long and involved projects, it’s better to use a project management platform to disseminate plans and intended results. It saves a lot of time- searching the inbox, to find what was said a month ago, wastes countless hours. A detailed plan will be useless if the details are not conveyed properly.
  5. Use Info-graphics or charts to convey ideas– This is true for any sort of collaboration. The best way to convey ideas is to use pictures, mind maps or flowcharts. These are considerably less ambiguous that writing, and also are faster to digest. After you have conveyed the plans in details (like in step 4), sending an info-graphic will reinforce the ideas. You should avoid miscommunications with all the tools that you have got!
  6. Put everything in Writing– an SLA (Service Level Agreement) is absolutely necessary for outsourcing projects. This provides reasonable cushion against mediocre service and induces shared responsibility between your team and off-site team.
  7. Take Feedbacks after each crucial step– Again, you should do this to avoid misunderstanding of important steps. Ask for regular feedback, preferably with an increment of 20% completions. This gives sufficient room to rectify the outsourcing team before they end up doing a lot of wrong work.

Summary

Outsourcing is a very effective way to carry out business. The reasons for failures are primarily due to wrong choice of vendors, misunderstandings between the in-house team and the outsourcing team, and in complete understanding of what should be outsourced and what not. It goes without saying that you save money and time with outsourcing. And in the same breathe; you should also be aware of the potential failures. The web is full of managers whining about their outsourcing mistakes. However, if you follow the spirit of the above steps, you can avoid most of the pitfalls of outsourcing.

 

About Author :
Gobinda Roy is the Founder of Ennovation Consulting and has been involved in online research, Industry research and sales consulting for over 16 years. He is alumnus of India’s premier Institute IIT Kharagpur and has over 12 years of corporate experience.

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