You’ll find the mighty dollar on the hook at the end of the outsourcing pole, temping leadership to grab the bait and save a few bucks by shifting the work to someone else. Here’s the thing: although the daily chores might change hands, the responsibility doesn’t. At the end of the day the weight of the business is still your shoulders, regardless of who is actually doing the work.
Do a search. You won't find any sensible professional who would use cost reduction as the only criteria for outsourcing. Cost might be the biggest attractor, but the reality is that cost savings are typically much less than what was first calculated. Unexpected and hidden costs abound.
Let’s not use that term: outsourcing. The trend is more toward strategic sourcing. Manufacturing has taken the lead with strategic sourcing; IT is learning how to apply the same methodologies. Manufacturing realized they could successfully outsource portions of their production if it gave them more than just monetary advantages. Being strategic with sourcing is about creating a leaner and more responsive environment as well as cutting overall expenditures. Consider efficiencies, speed, and quality. If you lock yourself into a comprehensive, inflexible cost savings contract and the business needs to change, you immediately lose.
Let’s not use that term: outsourcing. The trend is more toward strategic sourcing. Manufacturing has taken the lead with strategic sourcing; IT is learning how to apply the same methodologies. Manufacturing realized they could successfully outsource portions of their production if it gave them more than just monetary advantages. Being strategic with sourcing is about creating a leaner and more responsive environment as well as cutting overall expenditures. Consider efficiencies, speed, and quality. If you lock yourself into a comprehensive, inflexible cost savings contract and the business needs to change, you immediately lose.
Consider these criteria when faced with outsourcing decisions:
- Core competencies. The provider would need to posses specific experience and proven methodologies.
- Track record. Experience matters; it should be part of the offering.
- Contract flexibility. If the provider can’t move with your business, they shouldn’t be offered the opportunity to be part of your business.
- Key personnel. Providing specific experience and/or key personnel to the contract should be part of the deal. Remember, you are sourcing what you would normally do in-house; this includes specific experience and people.
- Cultural fit. This is about equitable values. Find someone who loves what you do and how you do it as much as you do. This will drive performance and incentivize results more than most people realize.
