Resources and Tips for Outsourcing Success

Offshoring can be very hard to handle for a small one man startup to even large scaled corporations. We hope that these few tips and resources will be a valuable addition to your outsourcing knowledge. By choosing a safe, reliable offshore provider whether for manufacturing & production, software & web development or for any other task you wish to outsource, having reliable insight and knowledge about the process and the tools to find these providers is the starting block to offshoring success..

Pick a suitable project
Some projects and services are a poor fit for offshore outsourcing because they require high levels of internal knowledge, process integration, or collaboration, or because their failure would be too costly or mission-critical. The best candidates are those with clear, well-documented specifications, leveraging a standardized skill set, and with a well-defined owner. For example, a recent META Group study reports that several companies that outsourced their entire IT help desks offshore had to bring them back in-house, while outsourcing of customer service and HR call centers has had a high success rate.

Pick the right partner
It’s essential that you verify a prospective offshore outsourcer’s delivery credentials by interviewing reference accounts in depth and performing standard due-diligence activities. In the recent article "What To Ask Before You Outsource Anything," the Institute of Management and Administration (IOMA) provided a checklist of evaluation criteria for a prospective offshore outsourcing supplier.

* Is the offshore outsourcing team committed to service, with a track record to prove it?
* How will the outsourcer manage your account?
* Who are the outsourcer’s current customers, and how do they rate the outsourcer’s services?
* What is the nature of the outsourcer’s experience? What special skills does the outsourcer possess?
* What is the quality of the outsourcer’s infrastructure and of the personnel who manage it?
* What security measures does the offshore team have in place?
* Does the outsourcer have a migration methodology and plan that fits your environment?
* How are services priced? Is the bottom-line figure comprehensive, or are incidentals priced separately?
* Is the outsourcer financially stable?

Verifiable and robust disaster recovery procedures and resources are also critical, as well as basic operational disciplines such as version control, backup and recovery, and an appropriate quality assurance methodology.

Documentaion and a legal contract with terms and conditions should specify binding procedures for contract enforcement and legal redress, including enforceable terms for protection of intellectual property rights and protection from major shifts in labor costs. And as a result of the events of Sept. 11, enterprises are also including political and economic risk assessments in their evaluation of offshore development and outsourcing.

Prepare
This recent report includes the following crucial preparatory steps among the lessons learned from their case studies:

* Define requirements so the offshore team knows exactly what is expected.
* For projects involving specialized or proprietary background knowledge, members of the offshore management and technical team should be brought to the United States for training.
* Make sure the offshore infrastructure and testing environment is in place.
* Give the offshore team remote access to the buyer’s network and software archives with the appropriate security controls.
* Make sure the outsourcer knows about all of the buyer’s system complexities so they can test.
* Put in place a mechanism for status/management reporting that allows the buyer to keep a finger on the pulse of what the offshore team is doing.

Actively and diligently manage the project
It is impossible to overstate the critical role that effective project management and discipline play in successful outsourcing and the importance of deep client involvement throughout the process, especially in requirements specification and testing.

Organizations that already have fairly mature standard processes for developing, deploying, and managing their applications have much lower risk from outsourcing and greatly reduced time required to obtain a return on investment. META recommends that organizations allocate at least 5 to 7 percent of the outsourcing project budget for extra management resources dedicated to the outsourcing initiative.

Conclusion
Offshore outsourcing brings with it high risks and great rewards. We are here to help you find and select a provider if you do need further assistance. We hope that you find the Offshore Safe List a valuable tool in selecting your offshore partners.