5 Things to Consider while Outsourcing Business Processes

If you are reading this article, it means you already have an established business growing at a pace you hope to match by shifting your workload to outside contractors. This process is known as Outsourcing, roughly defined as an act of shifting tasks, jobs or operations to a third party external contractor. Mainly outsourcing is opted to reduce costs thereby maintaining a healthy profit and countries like India come in handy due to its cheap labor and an abundance of resources available. Though it is very tempting to outsource your business considering all the benefits you hope to reap from it but it’s always better to equip yourself with all the information you can get before plunging yourself headfirst into it. Here are five things you should consider beforehand if you are thinking of entering this arena:

1.    Investigate the applicants- before finalizing anyone, do a background search of all the potential applicants, it includes their past experiences, accomplishments and if possible reviews from other customers (lookout for red flags). Another thing to keep in mind is abstaining from opting the lowest bidders though it seems tempting it will help you in the long run.

2.    Try Sampling- after the selection process and before handing out any major project, ask them for a sample piece of their work. This trial period will determine the provider’s efficiency and will help you evaluate the work in comparison with your needs and that too in the allotted time period thus ensuring you of the contractor’s

3.    Consider the costs carefully-  do bear in mind that the costs you planned, and the actual costs are going to differ. There are always some hidden costs which one is unaware of esp. for the beginners in the form of negotiation fees, travel expenses, legal fees for contract signing etc so it’s always better to prepare yourself for some unnecessary expenses. Try to maintain and promote as much transparency as possible to avoid hidden costs.

4.     Collaboration Issues-  these are mostly related with offshoring when the hired contractor and the business owner share a geographical gap large enough to work on different time zones resulting in an inability to meet the daily iteration demands due to different timings and sometimes due to large cultural differences which sometimes create problems. But good communication and mutual understanding can resolve these issues and it’s better if they are handled in the very beginning.

5.    Long-term goals-  all businesses start with long-term goals in mind but many fall out of the loop after sometime due to the lack of proper planning for sustain and growth of a business, or a backup plan if things didn’t go as planned. Sometimes the vendor goes out of business or is incapable to provide if the demands increase drastically so it’s always better to prepare beforehand for any misfortune and keep an eye on the future.

Outsourcing like a newly set business requires a lot of cultivated planning and processing to make it work and if the points mentioned above are taken into consideration while starting out on outsourcing, it will not guarantee success but will surely help in going long ways to achieving your goals. So, whether you outsource to India or any other country, be sure to consider the above-mentioned things.    

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