The 4 key steps to successful outsourcing

If you are not experienced in outsourcing, consider hiring an experienced outsourcing consulting firm to help you through the process. In general, large accounting firms and outsourcing vendors provide excellent support for large scale projects, and there are a number of small businesses that can help small and medium size. If you want to handle the process alone, even the most sophisticated project management techniques can be divided into four simple steps to project management:

Analysis

Evaluation

Implementation

Review

Having identified potential outsourcing candidates try hand with the procedure to see if outsourcing makes sense for the organization.

Analysis.

The objective of this phase is to determine the core business of your company and identify the functions of expensive performance or low support.

Make a list of your products and services and all mission-critical support functions. Then determine how these areas must follow to remain competitive or to make an advantage of the completion. Each department or function that is not your core business, cost center is a large and not particularly effective in achieving results is a good candidate for outsourcing. In calculating the "costs" do not forget to factor in a time zone problem can take from your executive and support team.

Evaluation.

The objective of this phase is to identify and meet the needs of the department with an outsourcing destination.

First break down the key functions of the department in its major structural components and functions. A simple analysis can be performed by writing the department name or function, the product work product and the information / materials needed for the production of that product work. Perform this exercise for ongoing operations and for the case "as it should be done." This graph is a simple written expression of what is needed by the department or function intended.

Now is the time to identify the sources of local and offshore outsourcing, convincing them to sign a non disclosure agreement and send them your basic analysis. The outsourcing provider will have many more questions, but you will have a simple basic guide to make sure that the provider is in progress. It is likely to send a request for proposal or a request for proposal that will contain the "needs" in the chart with a request for a solution. It 's also a good idea to ask your potential outsourcing partners to send a proposed contract for review at this stage.

You want to score each provider based on price, service, quality and terms. Do a simple net present value analysis to see if the project makes sense. Above all, do not lose your sense of reality in a sea of ​​numbers. Select the service provider that best suits your needs.

Implementation.

The objective of this phase is to transfer knowledge and data from their internal department to your outsourcing partner, implement best practices and begin operations.

Implementing a new outsourcing program can be as simple as logging into the system of a new payroll and vendor data entry or complicated as the sale of a major division of your company and coordinate a multi-man conversion process years. Regardless of complexity, it is necessary to work with your outsourcing provider to create a clear step-by-step project plan with clear actions, outcomes and deadlines and have a weekly review process that quickly identifies and resolves any problems or delays . Make sure your outsourcing partner provides a method to track clearly the progress of the project and have contingency plans, control plans and reasonable penalties if milestones are not being met. You will also need to create a transition plan for any planned manpower reductions.

Review.

The objective of this phase is to create a continuous system that maximizes the performance of both your staff and your outsourcing partner to ensure you get the desired results.

"If you is not measured is not managed." This should be a mantra for the team if any outsourcing project is to succeed. Be sure to set specific service level agreements (SLAs) in your agreements that have specific and measurable results. Identify project managers on your staff and your outsourcing provider and give them goals. If you tie a compensation plan to results you will be amazed at the improvement of quality.

During my years as a management consultant and IT executive, I have developed a simple checklist to evaluate vendors and manage outsourcing projects. If you are interested in receiving a free copy feel free to send me an e-mail address below with information about the project and the company....