TL;DR

What: Exercise due diligence and practise good communication

5 Outsourcing Fails and How to Avoid Them

It's harder to get things done when you don't have your team with you physically. Alternative measures need to be put in place to prevent an outsourcing fail.

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The right outsourcing partner can solve your problems, help you avoid mistakes and save you precious time and resources that you can reinvest into your business.

Outsourcing is a great way to manage costs and have specialists work on the areas of your business that they are best at. The right outsourcing partner can solve your problems, help you avoid mistakes and save you precious time and resources that you can reinvest into your business.

In fact, many successful startups built their business on outsourced teams. Highly-valued businesses such as Slack, Github, Skype and AppSumo started out with outsourced teams of developers, marketers, content writers and more. Some of these companies continue to outsource part of their operations.

But what if the outsourced partner you’ve engaged to hopefully avoid mistakes is a mistake on its own? It can waste a lot of your time, money and resources. Worse, it can sink your company.

To stay afloat on outsourced teams, you’d have to be discerning about the partners that you engage and how to work with them effectively. The first step is to avoid common pitfalls.

1. Having a vague idea of what you want.

Nobody knows your business better than you do. If you don’t know what you want, then the output of your outsourced partners will definitely be questionable.

How to deal with it

Before you even start looking for outsourced solutions, think about the help you urgently need in your business. List them down with as much detail as you can include so that your outsourced partner can better understand your needs and see if they can meet them.

2. Not assigning dedicated managers.

depending on the providers to organise and manage themselves is like putting them on the driver’s seat of your business.

You’re hiring outsourcing partners to complete projects, not to run your business, so don’t expect your projects to be done up to your expectations by simply dumping it on them. Besides, depending on the providers to organise and manage themselves is like putting them on the driver’s seat of your business.

You’ll still need someone from your management team who knows your company’s plans to manage, direct and communicate with the partners. This person will ensure that your outsourced teams are able to meet your business objectives.

The converse is true too. Having too many points of contacts can send mix signals to your outsourcing partners and end up jeopardising your projects. See point 5.

How to deal with it

Put one person (no more, no less) who understands what needs to be done and how it fits into the bigger picture of the business to manage the project, then leave him to manage the service providers.

3. Selecting an outsourced partner based on price.

… dip your toes and try this partner with a small project and see how it goes. 

While it’s perfectly fine to outsource with cost-savings in mind, you may end up spending more if you engage outsourcing partners that are simply cheap. Needless to say, it doesn’t make financial sense either if the cost of outsourced hires is more expensive than employing full-time staff. 

Ideally, you want a good balance of quality work, ease of communication and fees that are lower than hiring full-time staff.

How to deal with it

Look at the portfolio before the price. If it meets your expectations and the price is right, think about the communication process. Is the outsourcing partner able to articulate ideas in ways that you can understand and vice versa? If so, dip your toes and try this partner with a small project and see how it goes. 

4. Overlooking the importance of geography.

cultural differences and language barriers can pose a challenge to interactions, interpretation, understanding and ultimately, productivity.

With the internet live 24/7, it’s easy to forget about timezone and cultural differences.

Working with a partner that is in a timezone that has working hours that doesn’t overlap that of your company can be a huge communication hurdle, especially if you need to get hold of someone urgently. Getting either party’s employees to work after hours also adds up to additional costs too.

To complicate things further, cultural differences and language barriers can pose a challenge to interactions, interpretation, understanding and ultimately, productivity.

To keep things simpler and fluid for most of our clients who are mainly based in Singapore, my company, Virtual Electronics Pte Ltd, decided to set up our main office here. We also have teams in Belarus and Ukraine to serve our clients. The little time difference behind Singapore ensures the flow and continuity of our clients’ projects.

How to deal with it

Apart from thinking about the price and quality of your partner, you’ll have to think about the ease of working together. Find one that can fit your schedule well and communicate smoothly. If there are work culture differences, come to a consensus on what is to be expected. Never assume everyone perceives things the same way. Always confirm that your communication is understood as intended, even if it means explaining the basics and obvious.

5. Poor communication practices.

To keep things moving, consistent communication is required.

As an extension of point 2, having multiple points of contact who are not in perfect sync for your project can confuse your outsourced partner. The conflicting expectations and instructions can unnecessarily drag the project. Likewise, a non-responsive project manager stalls progress.

Another problem is communicating via multiple channels for the same project – emails, messages, Slack, you name it. The information gap that result can cause confusion that will be hard to reconcile.

How to deal with it

Communication is even more crucial when it comes to working with outsourced teams. To keep things moving, consistent communication is required. Have just one point of contact and ensure prompt responses. Keep all communication on one channel to keep things clear. If there’s a need for multiple channels of communication, be clear on the purpose of each channel.

Outsourcing doesn’t have to be a nightmare

Outsourcing can solve a lot of your problems and take your business out of chicken-and-egg situations, but you’ll have to be persistent in doing your due diligence and ensure that you hire the right partner for the right job.

Featured image by cottonbro from Pexels

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