1-Don’t focus only on core versus non-core: Simply evaluating which processes you want to outsource isn’t enough. As attractive as outsourcing them might seem, not all processes are fit or ready to be moved. You must ensure that processes are well-documented, stable, and standardized enough to make them outsourceable. Otherwise, you could spend millions of dollars on consulting fees getting into condition to outsource.
2-Don’t jump at the lowest-priced offerings: In this tough market, service providers are usually willing to negotiate to win your business. Establish a 72-month-plus rather than a 12-month roadmap. Focus on how the providers will leverage technology and process expertise to drive value beyond offshoring of labor. Moreover, ensure there is a good cultural fit between the provider you select and your company. Ultimately, you should seek a partnership that vests the outsourcer in the venture’s success and not simply a contractual agreement defined by penalties and service levels.
3-Temper executive expectations: Corporate leaders are frequently exposed to outsourcing stories where companies have driven out loads of cost through deep global partnerships with outsourcing providers. In most cases, it takes years to reach such remarkable success. Play down the possible business benefits until you have thoroughly examined and evaluated what’s possible and what’s not. Otherwise, you could end up being the bearer of bad news and losing confidence from your leadership.
4-Collect experiences of peer organizations: Because executives and the outsourcers are under pressure to impress, publicized examples of outsourcing engagements tend to conceal the truth. Get under the covers to discover the real experiences your peers in other organizations are having with outsourcing engagements.