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Choosing the Right Outsourcing Partner

ByShahid Mansuri,
business.com writer
|
Sep 10, 2019
Home
> Business Basics
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Many businesses find it difficult to outsource requirements, but it can boost business growth.

Outsourcing is a blessing for businesses in today’s dynamic markets. As businesses look to scale or expand through outsourcing, it is critical to choose an outsourcing partner that helps to yield the best dividends possible.

When it comes to outsourcing IT requirements, Asia, and particularly India, is one of the main outsourcing hubs that offers many benefits. For example, outsourcing is reliable, highly cost-effective and helps to quicken the time-to-market period.

To realize all these benefits, you also need to consider a number of factors before making a final decision. Factors that, if overlooked, can result in failures, time loss and additional costs.

While the process of choosing the right outsourcing partner, whether from India or any other country, is almost always the same, but due to the exceptional rise in IT outsourcing, it's important that you don't rush into things.

Following these best practices will help you to find the right outsourcing partner, but it will also help you in building a competitive advantage.

1. Define a clear scope of work

Before you start reaching out to potential outsourcing partners write a clear scope of work document. It's your responsibility to decide business goals, what is it that your business needs and what could be the best possible solution to achieve your desired outcomes.

If writing a scope of work document is too technical for you at the beginning, then you can also start by answering some simple questions like

  • What is your exact need?
  • What could be the best potential solution for that?

Answering these two simple questions will help you identify the problem you're solving, prepare a clear roadmap for solving that particular problem and identify your overall business goals. 

It's important for you to understand that outsourcing isn't a plug-and-play proposition but an approach used for a specific effect. Nobody knows your business better than you. Expecting an outsider to promptly have the same level of familiarity as you isn't really fair to the outsourcing partner either.

In simple words, you cannot share vague requirements with your outsourcing partner like "create a mobile app that our customers will love" or "introduce something new in our web app" and then expect the best outcomes.

The key takeaway is, if you want to yield the best results possible, you need to be extra specific in terms of what you want to build.

2. Make expertise an important criteria in the hiring process

After writing the scope of work document, you can start reaching out to prospective outsourcing partners. Once you shortlist three to five vendors, you need to evaluate them based on the following factors:

  • Technical expertise
  • Skillsets
  • Access to the latest technology
  • Experience in solving complex challenges
  • Passion for your project

Remember, technical expertise, even though is often overlooked, is crucial for the success of any outsourcing deal. Therefore, you should never choose an outsourcing partner who has expertise in limited technologies, even if they're best in those few technologies.

The general rule of thumb is, the more software technologies an outsourcing partner has expertise in, the better the quality of your project will be.

3. Market reputation is equally important

No business can afford to compromise on quality. But more importantly, no business can also afford to work with a partner who always misses deadlines or is not polite to work with. Therefore, it is equally important to check the market reputation of your outsourcing partner before signing an agreement.

In today's internet-connected world, it isn't difficult to check the history and reputation of an outsourcing partner. There are even platforms like Clutch and GoodFirms, for example, where you can check out their past clients' reviews.

If there are still any doubts, you can always connect with a few of their past clients and note their experience working with the outsourcing partner. In any case, you should only hire an outsourcing partner if you're fully convinced that the selected vendor has a good market reputation, can align well with your business goals and has a track record of delivering on time.

4. Communicate clearly about budget

Cost is one of the most underlooked factors that can ruin not just your relationship with an IT vendor, but also your project. If you expect superior services from an outsourcing partner, then you must also know that superior services often cost higher than the average.

Before approaching an outsourcing partner, you need to figure out and finalize how much money you are willing to invest in your project and communicate clearly about your budget with the selected outsourcing partner.

5. Protect your data and intellectual property

In today's digital era, privacy and data security are two of the biggest concerns, especially for businesses. When you outsource a project, you will often find yourself sharing sensitive business information with the outsourcing partner.

If such sensitive information is not managed properly, then your data can be mishandled. It is highly recommended that you sign a nondisclosure agreement with the selected partner before sharing any sensitive information.

Apart from this, you must also consider hiring a vendor who regularly conducts network and security audits in their workplace. They must be using specific tools that will help in protecting all your sensitive data and prevent any data leaks from happening.

6. Use Agile methodologies in your development process

The only way to survive in today’s market is by accommodating customers' always-changing requirements. To accommodate the changing needs of your customers, you have to utilize Agile methodologies.

Agile methodologies offer a highly-collaborative environment and give quick results. If you want to be a leader in your industry, prefer to hire a vendor who follows Agile methodologies so that they can easily adapt to changing requirements of your customers.

7. Choose a flexible partner

Flexibility is also important when choosing an outsourcing partner for your project. Your selected outsourcing vendor must be flexible enough to serve any urgent requirement or problem when arises. Flexibility, in fact, is especially critical when you and your partner are in different time zones. You must include flexibility in terms of urgency and support in the agreement before finalizing them.

Conclusion

When building a business solution, you always have two options: Hire an in-house team, or outsource the project.

While many businesses find it difficult to outsource their requirements, outsourcing can boost business growth and efficiency. In fact, many popular global companies like Github, Skype, and Slack have done it before. The only question is are you ready to follow their lead?

If your answer is yes, then these are the main points you should lead with when choosing an outsourcing partner for your next business idea or project.

Shahid Mansuri
Shahid Mansuri
See Shahid Mansuri's Profile
Shahid Mansuri co-founded Peerbits, one of the leading mobile app development companies, in 2011. His visionary leadership and flamboyant management style have yield fruitful results for the company. He believes in sharing his strong knowledge base with leaned concentration on entrepreneurship and business. Being an avid nature lover, he likes to flaunt his pajamas on beach during the vacations.
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