Most business owners don’t know what to do when their outsourcing process go amiss. They are confused about the fact whether it is a good idea to enhance outsourcing process prior to or after they outsource. Now, here you must remember that there are both benefits and flipsides to every approach you take in this regard. This also depends on the situation of the customer at the time of outsourcing.
Another important thing is to look at the reasons the process has broken and then understand the way to fix them up.
Most of the times, a broken process cannot be fixed because it is too late. You may find sever old IT systems that have been maintained till date. They may be fixed up with good efforts and exorbitant costs but most of the times they are too broken to be fixed successfully with all the troubles you take and the amount of money spent.
Fixing up a broken process is difficult to several reasons. There are good arguments regarding this on both the outsourcer and executives’ side. The best way is to let the outsourcer fix the process. If you are not convinced, here are some reasons on why you should let this happen:
1. Genius:
Efficient outsourcers usually work hard to make process efficient and effective as far as possible. They are equipped with appropriate tools and metrics in conjunction with highly experienced staffers. They know about the migration of process related to customer.
2. Impartiality:
An outsourcer works on a business partner. However, your organizational hierarchy is not responsible for this and it is also not affected by your corporate politics. This allows the outsourcer to make impartial decisions related to your processes. The staff of the outsourcer is paid and given promotions by its own management. The subpar performer can be removed easily.
3. Speed:
In most of the cases, outsources have the ability to fix up broken processes more efficiently and in a lesser period of time. Outsourcers are offered incentives via contracts for speedy and successful work.
4. Political advantage:
In case you expect potential resistance to transforming a corporate process, the process may become efficient and less messy if you allow the outsourcer to take the initiative. This will also save your political capital for future issues.
Here are some reasons to support your decision to fix your process before the outsourcer does:
1. Savings:
You can actually save the costs you would spend on letting the outsourcer fix up your process.
2. Contract terms:
Usually broken processes require to be improved or redesigned. Now, since the future process is not detailed in time in order to make contract negotiations, it is not easy to specify contract terms that cover the novel process as well as appropriate metrics. This leads to certain misunderstandings in future.
3. Resource protection:
Multiple clients are served by outsourcers and these outsourcers have their own specific priorities. Usually, larger accounts get a good amount of attention. Letting your staff to fix up the process will save you from losing the resources that your project actually requires to a higher priority client.
Try to give your project to an outside firm prior to choosing an outsourcer. These firms are not expensive their services just require one-time cost. This will also reduce your annual outsourcing costs due to the reduce cost basis of the streamline process.




2 users commented in " Broken outsourcing process? Here are some ideas to fix them up "
Follow-up comment rss or Leave a TrackbackGreat Article!
Outsourcing has always been one of my biggest downfalls.
It’s something I hope to work on for 2008.
Ryan
Here are tips for Outsourcing Success
1. Clearly define the scope and schedule for your project
This might seem obvious, but any successful outsourced project always starts with a clear statement of what you are hoping to accomplish. Define your project requirements up front. Service providers need accurate, complete information to present you with realistic proposals and to quote you a reasonable price. Be specific about the deliverables you expect the vendor provide. Give vendors as much information as you can about what you need delivered and the way in which you need the work done. Also, be clear and realistic about your schedule requirements - project schedules can have a huge impact on project costs.
2. Evaluate a service provider like you’d hire a full-time employee
When you’re evaluating proposals from service providers, don’t be afraid to ask questions. Just like hiring a full-time employee, selecting a vendor is a very subjective experience. Check their references and ask for feedback from other clients who have used their services. Engage in a dialog – if you have any concerns about a vendor’s specific capabilities, voice your concerns. Don’t just stew about it and hope for the best.
3. Look for specific experience fit
Ideally, the service provider you select will have specific experience with the type of project that you’re undertaking. You don’t want to be somebody’s “guinea pig.” This is especially crucial when outsourcing complex technical projects such as software development. For example, if you’re looking for someone to develop an application for the Palm PDA, make sure they’ve actually completed commercial projects on that platform for other satisfied customers. This advice holds true for other types of projects as well. If you need a business plan for opening a retail store, you’ll get best results if the consultant you hire has verifiable experience in the retail sector.
4. Don’t choose a vendor based solely on price
Though it might be tempting, never select a vendor based solely on price. Experienced buyers who have outsourced many projects and evaluated hundreds of proposals almost always recommend discarding the highest-priced and lowest-priced bid. Buyers report that their most successful projects are the ones where they felt the vendor offered a balance of good value and quality results.
5. Review portfolios and samples
Examine the vendor’s previous work (their “portfolio”) and make sure that their previous work meets your expectations for quality and style. If you’ve evaluated a vendor’s portfolio, references and previous experience and are still unsure of their capabilities, consider asking them to do a quick mock-up or provide a basic outline of a work plan. A service provider who really wants to win your business might be able to give you a rough concept so you can better understand their approach to solving your problem. But never cross the line between asking for a mock-up and insisting that a vendor provide you with finished work “on spec.” No qualified professional expects to work for free.
6. Start small
When engaging with a service provider for the first time, start with a project that is relatively small and simple in scope.
This will give you a better idea of the provider’s style and capabilities before you entrust a “mission critical” project to them.
7. Tie payment to clearly defined project milestones
Just as you should be clear about project scope, make sure that you define a work plan for your outsourced project with clearly defined milestones. Having scheduled checkpoints where you review the status of the project as it works toward completion—is an easy way to ensure that you meet your final deadline and that the final product meets your standards. Tie the vendor’s payment to these milestones. A good guideline for IT and software development projects is to pay no more than 20% to 30% of the total project price up front, with the rest of the payments awarded based on the completion of 3 or 4 milestones.
8. Negotiate ownership of work up front
For any type of outsourced project, make sure that you are clear about who owns the resulting work product and any important components of that product. Make sure the service provider understands how you intend to use the deliverables that they are agreeing to provide. For example, the development of a custom software application for your personal use would be substantially different from the development an application that you intend to package and re-sell.
9. Don’t forget about support after the project is complete
For technology projects, it’s a good idea to specify a warranty or support clause so that you are assured of some amount of continuing support from the vendor after the project is complete. It’s much easer to negotiate a support clause before the service provider begins work, rather than after the completion of the project. Even creative or business services can benefit from a support clause. Suppose you need some changes to a business plan based on feedback that you get from potential investors. Or maybe you find that you need that snazzy new logo delivered in a new type of file format. Specifying some amount of free support or negotiating discounted prices for future modifications can save you time, money and headaches later on.
10. Get it in writing
During the course of a service engagement, the scope of the project, deliverables or even the agreed upon price may change. Make sure that you clearly communicate any schedule, scope or payment changes to your service provider and get confirmation from them - in writing - that they understand and agree to the changes. Similarly, keep a record of any agreement changes requested by the service provider and whether you accept or reject those modifications. Save copies of any email exchanges that you have.
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