Normally, businesses want to grow and develop fast until their services or products can meet market needs. They want to be “on time” with their solutions to be able to cover more client’s pain points. It is really hard to do if you have limited resources or staff potential. In such cases, many companies tend to adopt the outsourcing approach as a prior strategy.
Basically, they delegate the execution of certain tasks or jobs to people who can do it better, quicker, and smarter. Statista predicts that the global IT outsourcing market will go up at about 11.07% CAGR from 2023 to 2028 as the service is becoming increasingly demanded.
It might seem like outsourcing is a piece of cake – just take a certain project and give it to other people. But, it’s a more complex process than that. How well you can manage this delegation depends on the final result.
We have made this step-by-step guide that will help you do outsourcing smoothly with a help of our roadmap.
For first-timers, this blog post is a must-read.
What Is Outsourcing and Why Go For It?
As we have mentioned, it is better not to perceive outsourcing as a mere transfer of some work to others. It is a key strategic decision for organizational growth. To put it simply, outsourcing means delegating a particular function development or project to a third-party expert or agency.
In other words, some tasks that your in-house team primarily dealt with or could do are performed by an external team. There are different reasons why businesses resort to outsourcing:
- Running behind time-to-market: This is the most common problem among companies. When your team has tons of tasks on their to-do list, it is hard to fit in everything with their working schedule. Outsourcing gives those extra hands of experts who can complete some tasks alongside your team to ensure a timely product launch. As you know, success is all about speed now, and such agility could be the upper hand when you race against competitors.
- Skill gaps within the internal team: More complex projects may require expert skill sets that may not be readily available in-house. This is another widespread dilemma for businesses. Tapping into a wider expert base guarantees high-quality outputs without maxing out your talent pool. Some people argue that training your staff is a wiser option, but it’s only partially true. It depends on many factors, primarily on what your goals are. These two choices result in two different outcomes. For example, training your staff is a forward-looking move, but it brings slow results. It will pay off in the long term and will allow knowledge-sharing among workers, which is good. If you are not in a hurry and have the means to invest in your employee growth, it will likely work out. But, if you need the product just now to conquer the market fast, it is not an option. Moreover, training your team might even turn out to be a more costly endeavor compared to outsourcing.
- Lack of flexibility for change: Markets fluctuate, demands vary, and businesses need to accommodate. When everything is calculated down to a single detail, it is tough to take on new tasks or expand new features. Outsourcing lends that much-needed flexibility — you can scale up or down at the drop of a hat. It is very convenient as you don’t need to overwhelm your team while managing peak workload periods.
- No readily available resources: Limited resources, be they financial or human, may be a dragging factor in growth. Outsourcing steps allow companies to pay for services only when they truly need them. It’s a smart way to manage costs without committing to full-time positions under pretenses, especially if you are sure that they will be available for use on a sporadic basis.
Outsourcing Roadmap in Steps
We have created this guide for companies who have never done outsourcing before but are willing to try. Also, it is suitable for businesses who had negative experiences with outsourcing and want to learn how to do it right, so it brings many benefits.
Know Where You Are
First things first, you can’t move forward until you figure out where you stand now. Start by assessing your internal company landscape. Sometimes stakeholders fail to take advantage of outsourcing because they have built unrealistic expectations without having a base. Pinpoint the pain areas of your business and identify the tasks or functions that might need outside help. Identify areas where your teams are struggling as they do not have the time, skills, or means to perform particular operations.
Set Clear Goals
When we talk about goals, we don’t solely mean the result of the task, but also the global objective of the project. What problems are you going to address with your product? Clearly outline your goals before you assign any tasks to your outsourcing partner. Specifically outline the things you want to achieve, whether it is speeding up the product launch, quality raising, cost-minimizing, or efficiency improvement.
Select a Reputable Partner
Choose your outsourcing partner wisely. Don’t purely make it a cost-based decision and consider the experience, expertise, reliability, and shared values in your potential team. We also suggest that you choose a team that would align with your industry specifications. That’s because something that works for one niche, might not work for another. Universal teams put your project at risk of being mediocre.
Define Technical Requirements
Projects’ specifications are all the details about how you envision your final product or feature. They are given to developers so they can estimate the timeframes and resources needed for task completion and build a plan with prioritized tasks. Technical requirements can well be in the form of user stories to ensure mutual understanding between you and your outsourcing partner and dodge misunderstandings down the line.
Suggest a Realistic Timeframe
Clearly state deadlines and milestones. Customize your timelines based on the complexity of the project to balance between speed and quality in your deliverables. A realistic time frame keeps everyone aligned and on track.
Start Small, Test the Waters
Begin with a pilot project or a smaller task to assess the compatibility and effectiveness. It is a low-risk way of assessing how well the partnership fits your business goals before committing to more extensive collaborations.
Establish Communication Channels
Define communication channels where you are going to meet regularly for feedback-sharing sessions. Usually, they are conducted through email or video conferencing. Don’t forget to discuss what the main key performance indicators (KPIs) are and how you can monitor the process. This will give you more visibility into the project.
Don’t Outsource and Forget – Be Engaged
Working with an outsourced team doesn’t actually differ much from an in-house one. Most importantly, don’t outsource problems and leave. Stay active in the outsourcing process. Demonstrating commitment through checking in and staying involved will address any concerns along the way. Otherwise, the result will be unsatisfying.
Monitor the Process
As you constantly monitor the process you can quickly spot any issues and implement changes without the need to move deadlines or other sacrifices. Be considerate of the human factor or miscommunications that are a natural thing in such relations.
Iterate and Improve
Use feedback and insight from experience to do better and refine the process. Fixing issues early on can facilitate problems that emerge during the implementation. Adapting and continuous process improvements are keys to maximizing the benefits of outsourcing.
Outsourcing lifts so much pressure from businesses and gives them an opportunity for faster growth. It really makes a difference as long as you stay committed to your outsourced project and clearly define your final points. We hope this outsourcing roadmap was helpful in guiding your decision toward the right option!