While the success of an offshore partnership depends on the right IT solutions company in the Philippines, governance and due diligence are equally important.
Unfortunately, there are still unhelpful habits that persist among leaders and managers since the beginning of the offshore outsourcing industry. This is common among businesses who are outsourcing for the first time or don’t have enough experience to manage an offshore relationship.
Here are the New Year’s resolutions that every business leader should make when outsourcing IT:
Asses the working relationship with your IT partner. Placing a narrow focus on your SLAs can hinder your service provider from maximizing their capabilities.
For example, you’re outsourcing SAP support for your systems in a manufacturing plant with the intention of improving output. If you micromanage the technology and impose stringent SLAs, you may miss out on capabilities that can help achieve desired outcomes.
Communication with your service provider is common sense. However, both the client and service provider can get complacent over time.
Minor problems and short term fixes often build up over time until they result into a bigger mess that can’t be ignored. Assign a manager that will manage and maintain the outsourcing relationship. Develop an escalation process for problems or issues that may arise.
Governance and Due Diligence
You should trust your service provider to do their job, but it is still your responsibility to gauge actual performance. They may be fulfilling every SLAs as per contract, but that doesn’t always mean it leads to desired outcomes.
Develop a methodology to review SLAs after a specific period of time. Evaluate if the metrics you’re using is still aligned with your current business needs. You may anticipate and prepare for changes in the beginning of the outsourcing relationship, but other external factors that are beyond your control can also affect your business. Apart from technological innovations, you also have to account for the economy of your outsourcing destination and foreign currency fluctuations.
Focus on Desired Outcomes
Costs will always play a vital role in outsourcing IT. It’s been repeated time and time again that you get what you pay for, but with competitive pricing in the outsourcing industry, it’s hard to ignore. Include outsourcing in your long term strategy instead of using it as a quick fix.
Ask yourself these three questions:
- Do you have access to skills that you lack in-house?
- Are you able to focus and develop your core competencies with the help of outsourcing?
- Are you able to mitigate risks with the help of an offshore IT partner?
Offshore outsourcing has gained an infamous reputation through the years. Your employees may feel threatened because outsourcing has been associated with massive layoffs. Worse, they may not be telling you directly what they feel, but they can voice their opinions in social media.
Make sure that your employees are aware of your motivations and goals in outsourcing IT. Inform them before, during, and after the duration of the contract. This way, they will see themselves as an integral part of the company rather than just disposable cubicle monkeys.
People are often creatures of habit, which unfortunately, also applies to their mistakes. Hopefully these resolutions will remind you to check the current state of your outsourcing deal. You can’t let your service provider do the thinking for you.