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Evaluation of outsourcing

August 12, 2009

If you have been outsourcing your services or have experience in offshore outsourcing, you would have realized the benefits of offshore outsourcing, namely maximized savings, cost-competitive prices, highly-flexile resources, shorter delivery cycles and increased efficiency. For organizations who want to step onto the threshold of outsourcing, choosing an offshore outsourcing vendor and evaluating the vendors¬タル capabilities can be a tedious task.

If your organization is keen on offshore outsourcing, then you must choose the right outsourcing partner, who can efficiently meet your outsourcing requirements. When you start searching for an outsourcing partner, you will meet many outsourcing vendors who will claim to meet all your outsourcing requirements, but you must choose an outsourcing partner only after thoroughly evaluating your vendor.
1. Evaluate different outsourcing destinations, such as, India, Russia, China, Philippines etc to find the location which will best serve your outsourcing requirements.
2. Find out more about the laws in the country that you are planning to outsource to and make sure that the laws are compatible with your country¬タルs laws.
3. Finalize on the outsourcing delivery model that is best suited for the project that you are going to outsource.
4. Choose between an offshore model and a global delivery model, depending on whether you will be having an onsite team.
5. If you have finalized a group of outsourcing vendors and have to select one of them, ask the outsourcing vendors for information about their employees, project management, technology, infrastructure and other business-critical information.
6. Find out more about the different outsourcing vendors before you choose one particular outsourcing vendor.  Assess each outsourcing vendor to find out more about their processes, quality assurance processes, domain expertise, cultural flexibility, pricing and technical expertise amongst others.
7. Start a pilot project with the few vendors that you have selected. This will throw more light on the outsourcing vendor¬タルs capabilities. It will also help you decide which outsourcing partner will be able to meet your outsourcing needs.
8. Visit your outsourcing vendor to validate the claims made by your vendor.
9. Interact with the outsourcing vendor and the company¬タルs core team to find out if they can work well with you.
10. Do not begin outsourcing your work without signing a service level agreement (SLA) and a non-disclosure agreement (NDA). Also ensure that you define performance measurement techniques in the SLA.
11. Before outsourcing, make sure that you make provisions for performance measurements and monitoring, so that you can identify issues as and when they arise.
12. Develop a strict reporting system and ensure that your outsourcing vendor complies with it.
I hope these few guidelines will help you in successfully evaluating your outsourcing partner and choosing the right outsourcing partner for your business.  If you would like to add to this, or would like to post your thoughts on this subject, please send in your comments. Your comments and suggestions are welcome.
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