Outsourcing Guide: Best Practices, Tools, and Essential Tips

Outsourcing has become an effective growth strategy for many businesses. Apart from streamlining operations, it enables organisations to improve their productivity, reduce their operational costs, and boost their revenue. According to predictions, the outsourcing market’s compound annual growth rate may reach 4% by 2025.

If you are considering working with a third-party service provider, let this infographic serve as your guide to outsourcing best practices, strategies, and tools.

outsourcing guide

6 Best Practices in Outsourcing

Outsourcing can be complex, especially for starters. However, knowing the outsourcing best practices, along with the latest developments, trends, and statistics in the industry, can guide you in handling its intricacies.

The following are some of the best practices to consider when outsourcing.

  1. Define your outsourcing goals early

    Before working with an outsourcing company, list your goals first. What are your reasons for outsourcing? What do you want to achieve from the outsourcing project?

    These questions will help you lay down your outsourcing objectives. Your outsourcing partner will also need to understand your goals. As such, providing them with a definitive list of targets will allow both of you to be on the same page.

  2. Select the right outsourcing engagement model

    In selecting which outsourcing model to use, consider your outsourcing goals, the type of services you want to outsource, and your budget. Remember, each outsourcing model provides specific functions.

    For instance, the dedicated offshoring model allows you to build a team that directly reports to you but operates offshore using the provider’s infrastructure, overhead, and support. This allows you to save up to 70% on operational costs.

  3. Work with the right outsourcing service provider

    You must be careful in selecting the right outsourcing service provider. Here, establishing a checklist of what you want and expect from an outsourcing partner can guide you in finding the right one.

    Some factors you can consider in choosing an outsourcing partner include company reputation, global presence, technical expertise, systems and processes, recruitment, and HR support. These pieces of information can give you an insight into the quality of work of your potential outsourcing partner.

  4. Start with teams as small as one to two

    If it is your first time engaging with a third-party service provider, it may be in your best interest to start with a team of one to two team members. The goal is to acquire credible insight into the provider’s capabilities. If you are satisfied with the results, you can gradually scale up and entrust your outsourcing partner with bigger or more critical projects.

  5. Establish a clear communication process

    One reason outsourcing efforts fail is lack of communication. As such, it is important to directly and regularly communicate with your provider regarding the project’s progress, specific priorities, and other relevant issues.

    Maximising communication channels, utilising project management tools, and periodic check-ins are some ways to regularly stay in touch with your outsourcing partner.

  6. Provide the right training materials and tools

    With all the necessary tools and materials at hand before starting the project, it will be faster and easier for your outsourced service provider to deliver results that meet your standards. Keep in mind that there may be aspects of your operations your outsourced team may not be fully familiar with. By providing them with the proper training materials, they can carry out the project more efficiently and effectively.

Related Blog: Challenges of an Offshore Team and How to Overcome Them

6 Most Effective Collaboration Tools to Manage Outsourcing Projects

There are various outsourcing tools you and your outsourcing service provider can use to ensure your project’s progress. Here are some of them. 

  1. Redbooth

    Redbooth is an online task and project management software that provides a single platform for team collaboration, including file sharing and discussions. This tool offers a multi-assignment feature that aids in managing tasks and maintaining visibility across teams.

  2. Jira

    Jira is a collaboration platform ideal for managing a software development team. This tool allows for flexible project management from the initial planning phase to the launching and releasing stages. It is equipped with features that support every stage of the software development process, enabling you to quickly plan, monitor, and assess your outsourcing efforts.

  3. LiquidPlanner

    LiquidPlanner is perfect for monitoring outsourced projects to ensure team members meet deadlines. This project management solution features a smart schedule that automatically adapts to changes in the project plan. It helps teams align people, tasks, and priorities to make sure the project advances according to the timeline.

  4. Zoho Projects

    An excellent option if you are looking for user-friendly collaboration software, Zoho Projects is ideal for small and growing businesses. This cloud-based project management tool is designed for tracking tasks and team collaboration. It is packed with features that include easy document viewing, providing feedback, and syncing for real-time collaboration.

  5. Freedcamp

    Built for high-performance teams, Freedcamp can help you streamline workflows, track time, and identify project issues. Aside from its collaboration features, it also allows you to set objectives and assign tasks and sub-tasks to team members with its innovative user interfaces that aid in project time management.

6 Essential Tips for Successful Outsourcing

Knowing the best practices and tools in outsourcing is only the beginning. Keep these outsourcing tips in mind to ensure the success of your outsourcing project.

  1. Outsource the right functions

    Not all business functions need to be outsourced. There are certain tasks that are suitable for outsourcing. In determining which ones you should outsource, assess your operations and identify those areas your company is not adept at. These may include marketinglogistics, or customer service, among others.

  2. Define project milestones

    Setting and defining project milestones will guide you in achieving your business goals. These milestones will serve as signposts that will help you keep track of the tasks assigned to your offshore team.

    For instance, if your company sells mobile phones, you may want to include hitting your three-month revenue target for a recently launched mobile phone as part of your milestones.

  3. Manage team performance

    Providing feedback is an essential component of managing team performance. Whether your outsourced team is meeting the project goals or is falling short of expectations, it is vital to let them know about your assessment. Be specific in giving comments and be sure to focus on constructive criticisms.

  4. Never compromise quality

    A good outsourcing partner goes above and beyond what is expected of them. Still, it helps to discuss your expectations before commencing the project with your provider.

    You must then ascertain a provider’s standards for quality. Take the time to research different options and conduct a comparative analysis before choosing a service provider. Ideally, you should enlist the help of a company with prior experience on the project you want to outsource.

  5. Engage fully with your outsourced team

    Establishing a collaborative relationship with your outsourcing partner as they take on your project can aid in its efficient implementation. Keep in mind that engaged employees are more productive and are more likely to work diligently, improving your organisational productivity and efficiency.

  6. Treat your offshore team as part of your onshore team

    When managing an outsourcing project, you must hold your offshore team to the same standards as your onshore team. This will help them perform optimally while maintaining excellent working relationships with your company managers.

Ensuring Outsourcing Success 

Outsourcing is an excellent option for small and medium-sized enterprises looking to take the next step in growing their company. With this outsourcing guide from optiBPO, you could adopt the best practices, tools, and tips in ensuring the success of your outsourcing efforts.

optiBPO is one of the Philippines’ trusted offshoring companies. We can help you build and manage a dedicated team that serves as an extension of your organisation. Contact us today, and we will be more than happy to assist you with all your outsourcing needs!

 

Looking for an ideal outsourcing partner?
optiBPO can help you plan, build, and manage a dedicated outsource team in the Philippines. Contact us today to discuss your requirements.