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Why Outsource Your Business Processes and How to Go about It


Why Outsource?

Outsourcing is a very popular term in business. No matter how big or small your company is, outsourcing has become a significant consideration for the smooth running of various processes and the success of the business. Outsourcing data entry helps organizations streamline their data-related processes and have the required information at their fingertips. This makes the decision-making process easy and efficient. Moreover, companies providing business process outsourcing services act as dedicated business partners keeping your organization’s interests foremost in mind. Outsourcing is a great alternative especially when it comes to repetitive operational processes so that businesses leaders can concentrate on continued growth for the business. Since outsourced professionals can work from anywhere, your organization benefits from a larger pool of talent and skill, lesser costs in connection with travel and accommodation, and the option to increase or reduce resources based on demand without being forced to hire and train people.

Outsource Your Business Processes

What to Consider When Outsourcing

The decision whether to outsource is a very important one. You need to consider whether your business can benefit from additional external expertise, and whether there are processes that require more streamlining and are better handled by an external agency. Tips from outsourcing experts are always helpful when you are considering the outsourcing model for your business. The following are 4 tips for outsourcing from Founders of South West tech scale-up business. These are from their 2017 series of Thread meet-ups:

  1. Decide what to outsource: Identifying all the activities that need to be outsourced is important for businesses, especially for start-ups, to reduce unnecessary expenses. Find out the critical activities of your business and the tasks that you are good at. The remaining tasks or any repetitive tasks can be outsourced to a reliable service provider.
  2. Do not outsource your responsibilities: You cannot sit carelessly after outsourcing all the activities of your business. Neglecting responsibility can lead to the downfall of the business. It is important to monitor the outsourcing vendor regularly to avoid issues along the way. Consider outsourcing as a fertile way to learn new skills that your business lacks.
  3. Understand the nature of your work: If your requirements are unpredictable, then outsourcing could be the right choice. It provides an external input to meet the needs of your business. Avoid vagueness and make sure that scope is defined and limitations are identified. Implement measures, controls and penalties and keep an alternative ready in case of emergencies.
  4. Clear documentation of IP ownership: It clearly shows who owns what from the beginning of the outsourcing contract, and who will own anything that is created. Find out whether your outsourcing company is bringing, or building their own IP. Also consider when and how the IP ownership will be transferred back to you. A clear understanding of IP ownership helps in building up a good relationship with the vendor. It also shows that you respect your outsource partner’s expertise. Clarity of IP ownership is important because investors will want to know comprehensive details regarding the same. So, make sure that you have clearly drawn-up outsourcing contracts that they can scrutinize.
    Let us look at some other major considerations when outsourcing.

    • Do not stick to one provider, interview multiple service providers: There may be vendors who offer service for very cheap rates. It is better not to go for such services because there may be some catch involved that could prove detrimental to your organization in the long run. Consider all service providers and their quotes. A low estimate may indicate that the outsourcing firm does not understand your business requirements or is a provider of low-skilled professionals. So, be careful when choosing a vendor.
    • Look for references: Make sure to browse all sources such as Yelp, the Better Business Bureau etc and get recommendations from business associates. Ask questions like “How long have you used the outsourced firm”, “What are the services they provide”, “Have you faced any issues with the outsourced firm” and such other relevant queries.
    • Avoid any misunderstandings: Before outsourcing make sure that you are clear about all your objectives and budget, and ensure proper communication with your vendor to avoid any dispute.
    • Make sure that your goals are met: As the business expands, you may require more outsourced services when your in-house staff needs to focus on more core activities. Then, it becomes necessary to choose a vendor who can be a permanent asset.

Investing in professional outsourced solutions helps businesses to boost productivity and efficiency. However, embracing the outsourcing model could prove challenging. The most important thing is to appraise your business objectively and identify its current capabilities. Be practical and think long-term because you need to have a clear outlook on how business expansion will affect your functional capacity in the long term.

About Rajeev R

Rajeev R

Manages the day-to-day operations of MOS from NY. With an interest in information technology, Rajeev has guided MOS to extensive use of digital technology and the internet that benefits MOS as well as MOS clients.