Everybody in the industry talks about the “why” of outsourcing but often the “how to” is missed. This task is further compounded by myriad options from a multitude of service providers. Here are the 10 mantras to keep in mind as you begin this journey:
1. Select the Right Partner: While management expertise, support infrastructure, and process maturity are important, one should also look at attributes such as access to key management personnel and their ability to go the distance for you.
Fast growing, mid-sized companies can provide the requisite access, agility, attention, and attitude. Your partner should not just offer technology solutions, but also understand your business and take a consultative approach. Assess how they track customer satisfaction. Do they have a systematic process to continually measure and improve customer experience along with true references? Another important element is year-on-year employee satisfaction, which ultimately reduces turnover rates and ensures a lasting relationship with a familiar team.
2. Executive Commitment: To increase your success rate, your senior management needs to commit their time, specifically in the first 90 days, and must influence the process and drive shared understanding. Create a steering committee and ensure a high level of interaction between your top executives and the partner’s. This facilitates transparency, attention, and joint ownership.
3. Apply Portfolio Management Approach: Create a systematic roadmap on what to outsource and when, and tie it to your organizational readiness. Define key short- and long-term success factors in such a way that there is frequent visible success. This gives you an opportunity to celebrate and ensures a higher degree of motivation among your own and vendor’s teams.
4. Identify Success Metrics beyond Cost: The obvious advantage of outsourcing is cost savings, but there is much more to an offshore engagement. Besides lower cost, measure success in terms of reduction in time-to-market, higher end customer satisfaction, and shared learning and innovation.
5. Define Governance Model at the Onset: An effective governance model is the first step towards mitigating systemic failure. The clearer you are about your goals, the better. Define the basis of the relationship and the collective vision. Document and follow review mechanisms, communication protocols, and escalation/exception handling mechanisms.
6. Accept Cultural Differences: Do not brush aside cultural differences. It is a fact and should be handled with care. Invest time to make sure that both teams understand the culture of the other. This early step will minimize conflicts later.