6 Phases to A Win-Win Outsourcing Partnership
Unchaperoned, no outsourcing partner relationship can become effective nor strategic. It requires those occupying the leadership positions of every organisation to play a vital role in increasing the efficiency and productivity of your outsourcing providers.
Managing outsourcing providers often plays a significant role in the process of an organisation’s course of the expansion of products and services, improving operating efficiency, and reducing costs.
According to a survey conducted by CGS, 48% of the respondents asserted that they have been facing challenges in communicating with their outsourcing providers.
In order to overcome all these uncomfortable scenarios, and to make the best out of your outsourcing providers, I’m going to list out 6 winning stages to your outsourcing partnership.
1. Communication of your Requirements
The preliminary step to forming a relational bond is communication. If you fail to communicate your requirements properly to your outsourcing provider, then your outsourcing strategy is going to go off the rails.
So, I’m going to share with you three different ways through which you can communicate your requirements to your prospective outsourcing providers.
You can send a prequalification letter that lays out your basic expectations. To go much deeper in your requirements you can send an RFI i.e. Request For Information. But here comes the best and the most popular means of requirement communication: RFP i.e. Request For Proposal.
Remember, that you can send these proposals only to those of the outsourcing providers who have qualified through a previous selection process.
2. Identification of the Best Fit Outsourcing Provider
Choosing a suitable outsourcing provider can be quite hard. And during your selection process, you could spend an incredible amount of time and money. But you wouldn’t have to. You can contact TeemCorp since we already have existing relationships with outsourcing providers who consistently meet my organisation’s standards.
At TeemCorp, top performers have been identified and my company can recommend you the best providers who have the capabilities to fulfil your business requirements.
3. Selection of Outsourcing Providers
Once you identify the various service providers who could meet your demands, you will have to narrow down your choice. For which, I advise you to evaluate their capabilities using a scorecard, marking from 0(Worst performance) to 5(best performance). With these scores, you can then choose your service provider based on who ranks first amongst all your options.
And here are three of the important things you should include in your scorecard.
Competencies can be evaluated as they are reflected in the provider’s populace, procedures, and expertise. You can assess the capabilities in term of your service provider’s fiscal power, infrastructure, and management systems. Finally, the relationship dynamics could be appraised by their influence on culture, mission, and strategy.
Besides all these, the relative size and the flexibility of their business dealings should also be a judging criterion.
4. Location for Offshoring
The following countries have emerged as leading destinations for offshoring.
Now, as far as Australian businesses are concerned, the Philippines would be the ideal location for offshoring. That’s because, in the Philippines, we are only two hours behind Australia (EST). And the Philippines is the third largest English speaking country with a strong western culture. So, if you own a business in Australia, and if you are on the lookout for outsourcing, you don’t have to think twice to choose the Philippines.
5. Formation Of Outsourcing Entente
The contract that you form for your outsourcing provider covers all the terms and conditions. And that is important to dictate every move of your outsourcing provider.
Here are the things you need to mention without fail in your bond.
- Assert the intent of behind your rapport.
- Denote the management of your rapport.
- List the services to be executed.
- Indicate the responsibilities of both offshore and onshore parties.
- Explain the result metrics.
- State the terms of payment and compensation.
To generalize with a structure, your contract should have three sections: contract section, services section, and the pricing section.
6. Formulation Of an Exit Strategy
Ending an outsourcing contract can lend you to face uncomfortable situations. This mainly happens when the terms of your requirement are not addressed clearly in the contract. Basically, you tend to terminate the offshoring contract when your outsourcing provider has violated the terms and conditions stated in the agreement.
But there also situations when contracts are terminated under terms of convenience. In such episodes, it would be difficult to negotiate since there is no evident cause nor are there any grounds of a violation.
But the last form that I’m going to list out is a disastrous cause. We generally call this type of termination ‘for jeopardy’, which is caused due to out of control influence.
When such unfavourable circumstances occur, you need a Plan B to rebound on. Most of them take the work in-house or engage with another service provider. In the worst circumstances, they would abandon the offshoring services altogether.
If you could avoid these storms, your outsourcing strategy would be a success. Get in touch with TeemCorp to put together a winning outsourcing strategy. We’d ensure that you experience a spiffing outsourcing endeavor.