Simple Do’s and Don’ts of Outsourcing

Simple Do’s and Don’ts of Outsourcing

Daven Michaels

Daven Michaels

New York Times Bestselling Author, 30-year business veteran, and Executive Chairman of CurrentC Group.

It is almost impossible for any business not to consider outsourcing especially in this present day and age. In the next couple of years, most businesses will outsource more than 50 to 70 percent of their work and concentrate on their core businesses instead. So, if you are one of those people who still find it pretty difficult to embrace outsourcing wholeheartedly, then be prepared to be kicked out of business by the competition in the next couple of years.

Here are some of Information Technology (IT) procurement and sourcing dos and dont’s that will help you carefully plan your outsourcing tactics:

Clearly Identify the Opportunities for Outsourcing

Don’t for any reason ask the pig about sausages! When you are defining non-core and core services for your company, you will need to gather as much data as you possibly can. You should consider using external assistance in order to help you conduct benchmark studies and also help you identify good areas of opportunity. You also need to consider the help of a supplier in order to conduct a study, this will of course give you the best alignment to successfully market offerings, in addition with drawing on the experiences of the supplier with other clients.

You need to learn from those who have been there before you and this will include suppliers, their clients or customers, the industry analysts and third parties. Make sure that you have sponsorship from higher-ranking leadership in order to drive the accomplishment of the outsourced projects. You need to make sure that you have expert IT procurement and sourcing professionals manage the commercial sectors of your contract. Every supplier has well trained personnel, so why on earth would you want to put amateurs up against them?

When Sourcing Strategy Development

Do ensure that you get all your act together. Make sure that you have the appropriate cross-functional team created in order to carefully assess service alternatives, which includes procurement/sourcing, technical and financial representation.

Contracts and Negotiations

Do make sure that you use contractual terms as the basis for negotiations and also include them in the RFP with a “redline copy” as a clear condition for reply.

Supplier Selection and Assessment

Do ensure that you create and also maintain an environment that will, of course, foster very open, honest communications, transparent and mutual trust. There really isn’t any point working with one you cannot trust either offline or online.

Don’t hire an outsourcing firm without the proper experience or a bad reputation – trust me, you will live to regret it!

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