Outsourcing: steps to success
What do you need to do to have a long and fruitful relationship for both sides of an outsourcing arrangement? Here are our simple steps to success:
- Don’t outsource simply on cost
- To start, you need to outsource the right things to the right supplier. Some company processes are so tightly linked together, like HR and Payroll, that splitting them apart by a contractual relationship makes little sense. Other processes are so far apart that you would have to question why one party would be good at them all.
Often it’s not an end-to-end process that is outsourced, but merely a middle part of it. By buying the cheapest price, you are almost certainly buying a lower quality.
- Find an outsourcer you trust
- Any outsourced service is complex, otherwise you would not have chosen to outsource it. Complex things go wrong from time to time, so when they do, you need to find a way to engage with each other. You could go with confrontation, blame, KPI’s and service credits…or you could form a joint taskforce, have open and honest communication, and a one-team approach.
The further apart your relationship is, the slower any real progress will be made.
- Look to the future
- Talking about how your business and your outsourcing provider’s business is developing in the future is important. If you cannot share the direction you are going, how can the other party work with that and guide a complex relationship to a more fruitful place? Review meetings clearly need to review short term KPI’s and SLA’s, but if that’s all you do, you are not looking forward enough.
Outsourcing done well
Outsourcing done well, with a focus on partnership, quality and developing over time can be a marriage that lasts, one where both parties win, and both parties feed off each other.