Outsourcing is a sensible business approach. But first-time outsourcers are certain to encounter inevitable mistakes. Avoid these errors with the list below.
A startup company must be closely supervised. Many successful company owners are hands-on, particularly in the beginning. The hours may be lengthy, and you may not know how much time you spend as an accountant, customer support person, telemarketer, and account manager (among many other tasks). However, when the firm grows, the dynamics shift. Even with huge teams, tasks may become overwhelming, making it difficult to finish work in each area. As you would expect, the answer is to outsource to a third-party service provider. You delegate specific parts of your process, allowing decision-makers to concentrate on topics that need their attention.
Outsourcing is a major benefit.
Outsourcing is nearly always associated with cost savings, more flexibility, increased efficiency, and access to specialized experts. Furthermore, using a third-party source makes it simple to simplify processes and keep ahead of the competition.
However inexperienced outsourcers are more prone to commit outsourcing mistakes.
If outsourcing is a business strategy you plan to implement, keep these top outsourcing blunders in mind.
Outsourcing dangers to avoid
Not knowing what to outsource and not having clearly defined objectives.
Before hiring a business process outsourcing partner, make sure you have a solid game plan in place. It may seem obvious, yet many businesses miss this component. Maintain a clear understanding of the company operations you want outsourced and keep everyone on the same page.
Clearly stated goals, objectives, and expectations help you and your outsourcing partner align and build a solid basis for collaboration. This also avoids future “miscommunication,” disputes, and dissatisfaction. This is the most important step, despite its simplicity. Pause, concentrate, and be specific about your expectations, including your goals, deliverables, and performance metrics.
Ignoring cultural differences
Cultural differences may have a significant impact on the success of an outsourced project. Failure to recognize these differences may result in bruised emotions, disagreements, a lack of trust, and poor morale.
If you’ve found a third-party outsourcing provider, be careful to share components of your company’s culture, communication style, work ethic, and time zones ahead of time. Allow them time to understand and appreciate your cultural differences to foster excellent collaboration.
Failing to pay attention to contract terms
In any outsourcing arrangement, the adage “Never sign a contract unless you fully understand what it entails” applies.
The outsourcing contract is a vital document that connects the whole outsourced partnership. Understand the fine print, which details the terms and conditions. Furthermore, your contract serves as a plan for both parties to follow to achieve outsourcing success.
Failure to understand critical aspects such as service-level agreements, pricing structures, intellectual property rights, and termination terms may result in unanticipated costs and harm down the road.
Inadequate Project Management
The importance of trust cannot be overstated. While it is true that outsourcing a certain corporate function allows you to believe that they will do a better job, it is still vital to maintain a careful eye on operations. Why? Because failing to monitor progress, grade work, and provide feedback may endanger your firm.
Clients must always be “involved” even if their offshore partner has the requisite skills and competence. If you aren’t receiving any updates or deliverables from their end, something is wrong.
Making Unrealistic Cost Assumptions
Cost-cutting is often a determining factor in outsourcing decisions. However, focusing only on money without considering the quality of service provided may be an expensive (and permanent) mistake.
While cost-effectiveness is important, evaluating the quality of that specific partnership is key. Setting unrealistic cost assumptions may result in poor-quality products and subpar outcomes.
Instead, find the sweet spot where cost and quality meet and strike a balance. Keep in mind the long-term advantages that your outsourcing partner can offer your company.
Failure to assess consequences
As a business owner, you must evaluate the service and outcomes that your firm gets. You can’t live without it.
Are you getting the level of service you expected? Are you on track with your goals? Can your BPO partner help you determine if the service or outcomes provided meet or fall short of your expectations?
Don’t be afraid to express your concerns. Identify areas for improvement and work with your outsourcing partner to generate realistic solutions. Trust your intuition and let your analysis guide you to wise decisions.
Failing to form connections
Viewing outsourcing as a transactional contract rather than a relationship-building opportunity may inhibit collaboration and long-term success. This may ultimately result in missed opportunities and undesirable outcomes. Consider your connection with a BPO to be analogous to spreading seeds. Begin the connection on an honest and trusting note. This will eventually lead to fruitful cooperation.
Start 2024 strong. Stand out from the crowd by partnering right.
NEARSOL is a US-based BPO and service company that offers clients custom-design solutions. With major hubs in Manila and Iloilo, it began operations in 2011 and has since gained a strong presence in the Latin American regions, the Caribbean, and the Asia Pacific, winning many awards for quality and service along the way. Most recent of which is its Great Place to Work-Certified™ Recognition, a global accreditation that tells stakeholders what employees think of the company culture.
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