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Design your outsourcing strategy wisely

September 7th, 2017 by

 

Outsource strategic partnership

 

Outsourcing often comes under scrutiny: many times it’s more trouble than it is worth, sometimes it does not deliver what it promises, it’s too difficult to manage and so on.  Problem number one is that very often the decision to outsource is not made after the necessary strategic thinking and it is often seen as merely a way to reduce back office costs by hiring some off-shore agency to do some low-profile work.

For many years such an approach has made up for disadvantages like the risk of losing sensitive data, loss of confidentiality, losing management control of business functions and of the activities that you outsource; but things are now changing fast. Wage inflation in traditional outsourcing centres such as India and China has reduced opportunities for negotiating lower staffing costs and the disadvantages are now more prominent than the advantages.

If you are outsourcing services and are experiencing problems, read on: this article will explain what we do to make outsourcing a success.

Don’t do it to save money. When deciding to outsource, often follow best practice and deploy business models that add value, and improve competitiveness. Outsourcing is increasingly more about business transformation than pure back office optimisation.

Decide strategically. Understand the strategic importance of the business process which you want to outsource. What are your objectives? Have you communicated them clearly to your supplier?  how are you going to measure they will be met? Have you considered any hidden costs?

Prepare. Lack of preparation to conduct special reporting during the transition to help the business and provider(s) understand performance and progress towards steady state operations and business objectives often leads to failure of the outsourcing activity.

Integrate and manage change. Make sure the function you outsource interacts with other related functions in your business: bringing together the elements of contracting, transition and supplier management with your operating model and retained organization, you can significantly increase the chances of success and long-term viability of your outsourcing operation.

Create contact points and communication channels. Lack of focus on communications and relationship management especially in the crucial first months, may result in many problems escalating to senior management; make communications regular and clear always encouraging collaboration with your supplier.

“Make your outsourcing supplier your critical partner.” This is what we tell our partners: we are not just providing a service; we work with you to give you insight-driven sales approach, help you design your strategies, achieve your goals and make your business more profitable.

Some of the world’s largest brands have chosen Broadley speaking as a supplier of outsourced processes. Call us now to find out how we can help you. +44 1822 813041

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