8 Factors That Must Be Consider Before Outsourcing
Outsourcing is, no doubt, an evolutionary service that offers tons of advantages so that businesses can easily adapt to the constant change of the world. It’s affordable and optimal, especially for small businesses that only have a humble budget. It’s also a great way so that a company can entirely focus on its core improvement. Other minor tasks can be done smoothly as how it’s been done by an in-house team.
However, outsourcing isn’t easy. It has tons of benefits but also multiple challenges ahead. Therefore, let’s take a look at some of these factors that you should consider before outsourcing.
Outsourcing factor #1: Cost savings
Oftentimes, outsourcing is about reducing operational costs. Therefore, before deploying such a plan on the taskboard, make sure it helps solve the problem. But if it doesn’t (as it might add up the cost or make the process much more complicated), outsourcing may not seem to be the best solution at that time.
You can easily evaluate this situation. Firstly, you have to calculate the budget for hiring a team and equipment. After that, compare the cost of outsourcing with the spending on recruiting an in-house team and see the differences between the two. Different professionals have different prices for their services. You will likely have to do a lot of research before jumping into outsourcing.
Outsourcing factor #2: Quality
It’s all about the final results. An outsourcing team might offer you a preferential price for the service. However, you will also have to make sure that they can get the job done the way you want it to be. Outsourcing comes with a harder method of management. Since both sides have to cooperate mainly through digital communication, it’s a big challenge (especially for a small business) to fully control the quality of the process.
However, everything always has at least one solution to it. Firstly, ask the outsourcing team about their procedure. Then, you show them what you expect to see for the results and make some suggestions. Finally, flexibly consider their presentation and see if that’s what your company can manage to work with.
But again, it depends mostly on the context. if going through 2 to 3 outsourcing teams and you still haven’t found anything that meets your requirements, maybe it’s just not the time for outsourcing.
Outsourcing factor #3: Communication
Working with an outsourcing team means you have to interact with them from a long distance. They could be in a different city or even in a different country. Therefore, digital communication is the link for both sides to connect.
This comes with a lot of challenges along the way. To cooperate smoothly, both sides have to make sure they are active 24/7 for any emergency or urgent update. Different elements such as the internet connection (which depends on the geographical location) can affect the effectiveness of communication.
Therefore, Make sure to do your research on the strong areas where you can find your ideal partnership.
Outsourcing factor #4: The resources and technology
Resources and technology are a huge factor that affects the overall workflow. Only the outsourcing team having the right technology and resources can manage to get the job done on time and with a satisfying result.
Before jumping into business, ask the vendor if they’ve got the right technology and resources that can smoothly handle the needs your business is requiring. List down all the requirements for them and ask them how they can control everything. If the answer sounds perfect to your ears, let’s head right into work.
Outsourcing factor #5: Trustworthiness
Trustworthiness is the biggest worry whenever it comes to outsourcing. Being unable to see the team your work with face-to-face will make it harder to evaluate its level of trustworthiness.
So, before you even reach them to talk about business, visit their site first. Most of the time, a website defines how a company works by evaluating its organization. Check if they have all the information needed for contact on the website and do some legit check after that. Also, ask other people in the industry for some feedback.
Feedback is usually the most accurate proof. Therefore, make sure you don’t skip this step before doing business with a company you have never cooperated with before.
Outsourcing factor #6: Service Level Agreement (SLA)
SLA comes with the trustworthiness mentioned in the 5th heading. This is the most important document needed for outsourcing partnerships.
Make sure to ask the vendor for all the documents needed before doing business, especially the SLA. This will not only help you avoid being stuck in ambiguity but all the legal problems that could come in the future.
Keep in mind that the most critical and realistic factor that confirms one’s liability is the paperwork needed for doing business. I strongly advise you to study basic knowledge about legal documents to avoid unfortunate mistakes in the future.
Outsourcing factor #7: Supervision
As mentioned in the 2nd factor, outsourcing team management is stretching.
It also comes with minimal supervision because, throughout the whole project, the outsourcing team will take care of everything from scratch. Since you’re involved too little in what the team does, it’s hard to recognize whether the team is following the requirements of the business.
And because of that, make sure you choose a responsible vendor for the work. You might have to come up with a clear strategy to manage them if possible. This is where the management skill reaches its peak. It becomes harder when you have to supervise only through digital platforms.
That’s the reason why you should have a conversation in advance so that they know what you expect from them. Also, stick to what the team does 24/7 to not miss out on anything.
Outsourcing factor #8: Who’s the team leader?
Knowing who you can communicate directly about every issue is essential. I’ve worked with quite a few teams and whenever I needed to ask something, they always told me to ask a different person every time. That shouldn’t happen because it’s too confusing, especially when you’re the client.
Ask them about the person in charge of the whole team so that you can quickly contact just a person. Also, it shows how responsible the team is in helping their clients. Choose a team wisely and be sure to clarify this clearly.
I hope the information above is useful for your upcoming project. If you need more essential knowledge to run your business the right way or anything related to technology in specific, make sure you follow Techvify for more.