Outsourcing can potentially add value, cut costs, support business growth and enhance customer-business relationships. An impressive list of attributes that sometimes mask the reality that selecting the wrong outsourcing partner can result in the business experiencing few of the benefits, with some added new challenges.
The Industrial Development Corporation has indicated that globally Business Process Outsourcing (BPO) is in the midst of a growth surge with an anticipated $202,6-billion by the end of 2016 and a five-year compound annual growth rate of 5,3%.
“To get the benefits, the business must select a BPO partner carefully and with due consideration,” explains Teryl Schroenn, CEO of Accsys. “The first step is to ensure that there is a compatibility between what your business wants to achieve and what a potential partner offers. Then, once you’ve found this compatibility, you must be prepared to pay for it.”
Many organisations are unprepared for the price tag that can come with an outsourcing solution. Some might commence at a higher cost than what the business currently spends on their day-to-day running of systems. However, if they deliver on their promise, the long-term savings and benefit to business should be significant.
“Define what you want from the relationship, and know what will support your business growth and what will hamper it, and ensure these parameters are met from the outset,” explains Schroenn. “Be sure to share this with your BPO partner. This will also keep them aligned with your strategic goals and help you to identify areas where you are not receiving the right levels of delivery.”
The partner checklist
In addition to ensuring alignment and compatibility, an essential step in selecting the right partner is to check their credentials and stability. If they’re not stable or competent, then they can damage the business significantly, so request referrals and look for deep experience.
“The whole point of outsourcing is to refocus business energy towards growth and development, but if time is being now spent on managing and directing the outsource relationship, then it’s just not working,” says Schroenn. “It is critical to see the selection process in the same way as an interview for a staff member – establish how they would handle downtime or if something goes wrong, and how they would fit in with your business plan.”
A simple checklist will support the selection of the right partner. Note precisely the specifications, the desired benefits, the specialised skills you need and the expected expenditure. Establish how they would manage the relationship with your business, such as a single point of contact or simply a helpline, and what their back-up processes are in the event of a failure or disaster recovery scenario.
Attention to detail
“Start slowly, build the relationship over time, get to know how well the businesses work together and then move forward,” advises Schroenn. “Most companies leap in with both feet and want everything outsourced today. A staged, phased approach is far steadier, and is sustainable.”
Ultimately, a truly effective outsourcing partnership comes down to trust. So, avoid outsourcing for the wrong reasons and take time finding a partner that suits your business. It isn’t an exact science, but by asking the right questions, it can be a rewarding process.