Ignore this blog if you are outsourcing for the short-term and looking to wrap up a project quickly. If you are thinking long-term outsourcing, then you need to know that you are embarking on a strategic move, which, if managed well, will earn you (and your business) a life-long partner who will stand by you through thick and thin.
Hmm, does this sound suspiciously like a marriage? Bingo! A strategic outsourcing relationship is a contract where you and the vendor have specific roles and responsibilities to fulfill, with both of you focused on turning out a great product or service. The metaphor however does not end with turning out a product. Like a marriage, there are certain do’s and don’ts that you need to know before you say “I do” to your outsourcing partner.
- Think long-term – Sure, there may be the standard pre-nup agreements (aka exit clauses), but when you enter into the relationship you have to be convinced 100% that this is the best thing to happen to you and that you are committed to make it work.
- Know that mistakes will happen – As you and your vendor’s company start working together, mistakes, misunderstandings and confusion will arise. Find a partner who will help implement a process that includes rigorous communication and project management. This should reduce, if not remove, most of these issues
- Back each other up when in a tight corner – Outsourcing will always have its share of detractors in your company, and you may start agreeing with them when an important deadline is missed, or a bug appears in production. If you have established clear expectations, and have a good outsourcing unit that is working with your team and delivering well, support your partner in riding out rough phases.
- Do not go to bed carrying a grudge – When things go wrong, speak up. Keeping it bottled up can only make things worse. By communicating clearly, you may end up agreeing with the vendor’s point of view, or even acknowledging that it makes sense.
- Know your budget and stick to it – Ask your vendor to provide an open and transparent cost structure that lays down in detail the admin cost, infrastructure cost, IT skill cost, and margins. If you know that the vendor is doing the best he can for the money he is getting, you have removed the single most important reason why relationships go sour.
So are you ready to say “I do”? We are!