6 Warning Signs Your Outsourcing Deal Is Collapsing
A bad business relationship can cost you.
That’s why smart managers develop early warning systems. They tell you when relationships start to sour.
That way you can make changes before the relationship impacts the bottom line. That’s money no SMB can afford to lose.
If you outsource tech support and don’t have an early warning system, you should think about developing one.
Tech support is a key driver of customer satisfaction. Sometimes, it’s the only contact a customer has with your business.
When your relationship with your service provider sours, it can drag your reputation down and hurt customer satisfaction.
Below are some warning signs that you can include in your early warning system. They’ll tell you when your outsourcing contract is starting to collapse:
Contract costs can rise for legitimate reasons—unforeseen consumption, incomplete transformation, and misunderstanding of contract scope. Providers usually have good explanations for the added charges.
But when you get unusual charges or additional charges for minor contract issues, be wary, especially if the provider lacks a good explanation. It can be a sign that your relationship is starting to sour.
Frequent Personnel Changes
You want an outsourcing team composed of talented people dedicated to their jobs. You also want the same people doing the same jobs. They get to know you and what you expect when it comes to tech support.
Frequent personnel changes to your team can be a sign your provider doesn’t care about your business anymore. Or, that it’s taking your relationship for granted. Frequent changes also can cause confusion and service level slip-ups.
Replacing Account Manager
No one likes surprises. So providers will often tell you ahead of time about a change like this—especially if the manager negotiated the contract and best understands its intent.
When a provider suddenly changes your manager, it could be a danger signal. Lost synergies are difficult to re-establish. Plus, a new manager could interpret your contact differently. And that can cost you.
Change In Tone At Meetings
Take note of the atmosphere during your next governance meeting. Note the tone of the meeting. A change in the normal tone can indicate that something is wrong. Bickering is also a bad sign. If the meeting leaves you with a sour taste in your mouth, that’s usually a strong signal that something is wrong.
Age of Contract
The age of your contract is often a factor when outsourcing relationship sours. Outsourcing contracts usually run from three to five years. Some run longer. Whatever the length, even the most flexible contract becomes dated in time.
If you’re contract is five years old or older, it may be time to update it if you sense the provider is no longer happy. A lot of things can happen in five years—things that can really impact a relationship.
Action Point: If you’re working with a provider, check the age of your contract. If it’s more than five years old, make plans to update it. Or at least talk with your provider about it.
Frequent Performance Issues
Frequent performance issues at the beginning of a contract are one thing. But when they occur with a long-standing contract, it’s a bad sign. Another bad sign is when your provider stops responding to requests from customers. When things like that start happening, it’s time to pull the plug.
Early warning systems can tell you when a business relationship starts souring. If the relationship impacts tech support, don’t wait to make changes. Make changes now. Outsourcing tech support is too important to your bottom line to let things go.
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