The benefits that outsourcing can bring to your organisation
When you choose to outsource business functions which do not generate revenue such as (but which are not confined to) third party billing, customer support, payroll management, human resource management to experts in their various domains which can suit the specific needs of their clients, gives organizations the chance to center all of the resources they have on their main business activities which are non-revenue generating.
It is not strange to see employees who are held in high esteem carrying out administrative tasks which could easily be outsourced. When organizations outsource these tasks which are not very important, they can make better use of the energy, time and skills of their employees.
When these tasks are outsourced to a third party, it enables companies to:
- Significantly reduce costs: Outsourcing particular business processes which have lower overhead and labor costs often helps organizations to reduce their costs drastically because they wouldn’t have to deal with the processes and cost of providing equipment, training, hiring and keeping employees raising revenue in the event.
- Use of Organizational Resources for more important tasks: Organizations are able to dedicate all their financial resources and time on carrying out their main business activities by delegating a few of their business processes which are not critical to third parties, so as to improve their services and products.
- Enable round the clock work : With regards to the time differences which exist between an organization’s outsourcing provider’s team and their internal team, it gives your organization the ability to work 24/7 because as the saying goes, “time is money”.
- Expand Quicker: In the absence of the constraints of retaining a lot of employees who are not needed, an organization will be able to expand quicker based on the number of financial benefits which are realized from the ability to drastically cut down their expenditure on rents, equipment, benefits, supplies, electricity and employee salaries.
- Access a varied talent pool from across the world: When organizations outsource, it helps them to make good use of skilled professionals overseas who are limited in supply locally or who they barely have access to.
Here are some tips on how to make outsourcing work for you efficiently.
- Look for providers who know customers’ needs and are willing to reduce what you usually pay for labor together with your operational costs, without reducing the quality and productivity.
- When you delegate work to them, you should provide KPIs so as to make sure that you do not forfeit essential things such as the quality of your products/services by observing performance indicators.
- Clearly state what you seek to gain from the outsourced relationship. When the intended benefits and the scope of the tasks which you require to be outsourced are clearly defined, it will help greatly in seeing to it that the relationship which your organization has with the outsourcing provider is beneficial to you both.
Being a decision maker or business owner, you ought to bear in mind, well-defined and realistic business goals. In the event of selecting an outsourcing provider, you should select one who will help you to carry out these goals better than you would have achieved them yourself.
It is necessary to get in touch with various companies so as to determine which one you can work best with your company to meet your specific needs and achieve your set objectives. When they have taken out the time to better examine your business, they ought to be able to derive solutions which are supported by KPIs alongside other courses of action which should be considered.
- Validate the experience of the company you are outsourcing to. You ought to ensure that the company which you wish to work with is experienced in rendering services which are identical to the one which you are willing to outsource. It may include types of clients worked for, function/sector expertise for tasks requiring intense knowledge and the number of projects carried out. You could also find out the level of experience and qualification of their project managers, management team and other team members so as to be confident that you are working with individuals who are skilled and have the expertise to make great use of your business processes.
In case you are getting into a large or long-term contract, it is important that you get to know the suggested team members just before signing the deal to make sure that the team which has been chosen fits your requirement to be carried out (you can see this as some sort of mini-interview but you shouldn’t think that you have to somehow manage the team).
- Request for references and work samples. You should request for client references and talk with them so as to be versed with the seller’s quality of services and capabilities, customer support, client engagement practices, turnaround time and timely deliveries. You should also be able to establish potential challenges which might arise and methods to overcome or avoid such challenges. You can also request for samples of work which they have done in the past so as to know the type of results which you will be expecting from them. Be that as it may, it might be unacceptable for the company to give out genuine deliverables in respect of the non-disclosure agreements which they have signed with their customers. So it will be better to ask for samples/prototypes which have been developed for the purpose of marketing.
- Ensure a good level of communication and client management practices. The manner in which you and your outsourcing partner communicate or the lack of communication between both of you can solely build or destroy your working relationship. Being able to keep track of performance indicators which have been set in advance is of great importance as well as being honest with regards to worries which may come up when carrying out the project and also knowing the communication practices of your partner. All of these are of great importance because they help in seeing to it that the relationship between you and your partner is of great benefit to both of you.
About the author :
Bikramjeet Singh ( Vice President, Business Process Management )
Bikramjeet has 14+ years of corporate experience in building strategies and handling operations in organization like Reliance, Aircel and Bharti Airtel. He has been instrumental in leading teams in organization at project conceptualization stage and worked with the consumer and the core leadership team of his organization to deliver what the need is. He has been a consistent top performer in all the organization he has worked in, and believes in being upto date with the global economy to be the key to success.
Bikramjeet can be reached at firstname.lastname@example.org
LinkedIn : https://www.linkedin.com/in/22bikramjeetsingh/