How To Outsource Like The Fortune 500—7 Secrets
There’s no leeway for failing in business.
That’s because the consequences are enormous.
In other words, you can afford to fail.
When you fail at outsourcing, you miss a chance to do three things:
- Cut operational costs
- Increase added value
- Focus more on core functions
And this is just the tip of the iceberg. There’s more.
When you fail at outsourcing, you also miss the chance to improve flexibility, increase revenues, and boost customer satisfaction.
In other words, you miss the chance to transform your business and increase your competitiveness.
So if you’re planning on outsourcing customer service or tech support, you better make sure you succeed. Your survival is on the line.
Below are the 7 top reasons why outsourcing fails. Knowing them boosts your chances of succeeding with your outsourcing project:
Defining your objectives clearly is paramount when outsourcing. Outsourcing works best when it’s accompanied by changes in workplace structure or organizational culture and it’s led by strategic objectives.
One thing that shouldn’t be an objective is cost savings. Cost savings should be an outcome of outsourcing—not an objective. Using it as an objective is a recipe for failure.
Know what happens when outsourcing expectations aren’t clear? Costs escalate. Long delays occur. And quality of work deteriorates.
Setting the correct expectations equips the service provider with a clear understanding of what motivations are driving the project.
Defining tasks, setting benchmarks, and employing the right processes and tools help set expectations. So does using the right metrics.
And don’t be afraid to share things like “roadmaps” and strategic plans with your service provider. They can be a big help.
Lack of communications
This dooms many projects. Keep in mind it’s not what you say that’s the key but what’s understood. You can say one thing but if the provider understands another, trouble ensues.
Communicate frequently and clearly. Make sure the provider hears—and understands—exactly what it is you want them to hear and understand. It’s paramount.
If you botch the transition, you’ll fail with outsourcing—plain and simple. Make sure you have a good transition plan in place. Then execute it correctly.
A detailed transition plan helps prevent long delays in project execution and contain outsourcing costs. More important, it can help boost customer satisfaction and keep customers from defecting.
Inept project management
Good management is the heart of every outsourcing project. Overmanaging and micromanaging are two of the biggest detractors to good management. Both wear people down over time.
Often, overmanaging and micromanaging are rooted in poor transitions and bad communications. They are also rooted in a poor choice of service provider. Make sure you find a service provider with relevant industry experience.
Business needs change all the time. Sometimes the changes are anticipated in SLAs. Sometimes, they’re not. So be prepared to make changes when outsourcing. Be flexible and nimble, and roll with the punches.
Change in relationship
A change in the relationship between you and the service provider is unfortunate. But it happens. One reason why is because you deal with the provider in an unstructured way.
Instead, view the service provider as a partner and treat it that way. Make sure it’s in sync with your long-term vision and strategy, so when things change, they’re ready to address the changes.
There’s no “give” when it comes to outsourcing projects. Failing at outsourcing can cost you revenues by decreasing customer satisfaction.
So keep these 7 reasons for failing in mind when planning your outsourcing project and you’ll put yourself on the road to long-term success.
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