The Seven Practices Of Highly Effective Outsourcing

The Startup Business Solutions OutsourcingWhat are the practices of highly effective outsourcing?

In other words, what do you need to do to ensure your outsourcing is successful regardless of whether you are a large corporate, or a startup entrepreneur?

You see whether you have been outsourcing for some time, or are considering using outsourcing as a strategy, wouldn’t it make sense to know what are the things you need to do in order to be successful?

Surprisingly however, very few outsourcing engagements can be said to be “best in class”. This is not just some wild statement, this is backed up by solid industry and academic research (get in touch with me if you want the specific studies).

So the first question you must ask yourself is “do you want to be mediocre or do you want to be great, to be excellent?”

For more than twenty-five years, I have worked in the outsourcing industry (yes you heard it – industry or profession) and I have observed some real disasters. However, every now and again, I do see some great work being done – real high performance taking place on a daily basis by teams working together achieving shared outcomes.

If one could generally accept the proposition in business we are all seeking high performance, then why is it that many outsourcing engagements are mediocre at best? Wouldn’t you agree that this is counter intuitive to the demands of business?

Yes or no?

You need to then ask yourself “why aren’t you getting what you want?”

This specific question took me on an academic journey over six years, where I basically researched this phenomenon in outsourcing.

Reviewing countless studies and papers, I also interviewed formally and informally hundreds of business executives and managers, established entrepreneurs and founders of startups from both sides of outsourcing to understand what are the success practices.

The outcome of all this is what I call The Seven Practices Of Highly Effective Outsourcing.

The Startup Business Seven Practices Of Highly Effective Outsourcing

Now to succinctly reduce years of study down to a few paragraphs is a challenge but I will give it a go…

Basically to achieve success in outsourcing, we must see it is a lifecycle – there is a birth, an adolescence, a mid-life (sometimes crisis too) and retirement (which can be renewal or… yes death). At each point in this outsourcing journey there are differing needs and approaches that need to be taken into account. The problem is however we do not always grow (or mature) at the same time – hence a disconnect in expectations and rapport between client and outsourcer.

Let me explain…

I can reflect on situations where my outsourcer was behaving as a teenager – not disciplined or structured (of course there are many teenage client firms as well!).

When I worked with outsourcing companies, there were times where my client was growing faster (maturing) than my organisation as their service provider – we could not keep up with their expectations!

I have also had experiences where my outsourcer was behaving like the new kid in town, telling us what they will do – yet after years of a substandard relationship all we were thinking of was to put them out of their delusion and misery.

Look, I know these analogies or metaphors, are of course simplistic, but I do think they work to get my core argument or premise across in that you need to have alignment and grow together if you are to achieve effective and successful outsourcing.

However, there is one exception to this.

The dynamics in outsourcing is such that the client often looks to the outsourcer for specific capabilities like a “big brother” or “big sister”. I mean I am sure you have all been around when this question is asked by the client…

“you must of done this a thousand time with other clients – what’s you experience or point of view – don’t wait for us to tell you?”

So while partnership is required, the outsourcer must be proactive through leadership.