Wednesday, May 03, 2006

Outsourcing secrets - Part 2

Outsourcing does not necessarily take away from your market share. In today’s business world, a key factor in maintaining customers and acquiring new business is to provide a quality product or service. Many competitors may also be able to provide high standards of quality in their products and services.

Outsourcing has become essential in the role of continuous improvement of any product or service one has to offer. Outsourcing allows you to benefit from the expertise of another company, without accumulating the expenses of new equipment, training, and the crazy world of non-conformances.

Now you may be thinking what steps you need to get started on expanding via outsourcing. Well the very first thing for you to do is to see if you have a good clients base where you are:

Define the scope and time frame of a project. Define your project requirements up front. Service providers need accurate, complete information to present you with realistic proposals and to quote you a reasonable price. Give vendors as much information as you can about what you need delivered and the way in which you need the work done. Be clear and realistic about your schedule requirements, project schedules can have a huge impact on project costs.

Evaluate a service provider. Do not be afraid to ask questions, when you’re evaluating proposals from service providers. Check their references and ask for feedback from other clients who have used their services. If you have any concerns about a vendor’s specific capabilities, voice your concerns. Don’t just stew about it and hope for the best.

Get samples of their work. Examine the vendor’s previous work and make sure that their previous work meets your expectations for quality and style. If you’ve evaluated a vendor’s portfolio, references and previous experience and are still unsure of their capabilities, consider asking them to do a quick mock-up or provide a basic outline of a work plan. A service provider who really wants to win your business might be able to give you a rough concept so you can better understand their approach to solving your problem.

Define a work plan for your outsourced project with clearly defined milestones. Having scheduled checkpoints where you review the status of the project as it works toward completion. It is an easy way to ensure that you meet your final deadline and that the final product meets your standards. Tie the vendor’s payment to these milestones.

Negotiate ownership of work up front. Make sure that you are clear about who owns the resulting work product and any important components of that product. Make sure the service provider understands how you intend to use the deliverables that they are agreeing to provide.

Don’t forget about the warranty after the project is complete. It’s a good idea to specify a warranty so that you are assured of some amount of continuing support from the vendor after the project is complete. It’s much easier to negotiate a support clause before the service provider begins work, rather than after the completion of the project. Suppose you need some changes to a business plan based on feedback that you get from potential investors. Specifying some amount of free support or negotiating discounted prices for future modifications can save you time, money and headaches later on.

Get it in writing. During the course of a service engagement, the scope of the project, deliverables or even the agreed upon price may change. Make sure that you clearly communicate any schedule, scope or payment changes to your service provider and get confirmation from them in writing that they understand and agree to the changes. Likewise, keep a record of any agreement changes requested by the service provider and whether you accept or reject those modifications. Save copies of any email exchanges that you have.

You can access top-notch expertise any time you need it without the overhead of hiring full-time staff. By staying focused on your core competencies and hiring expert freelancers for your other needs, you can compete with the delivery capabilities of larger organizations while maintaining your independence

The fact remains that in these days of heavy competition, it’s become a necessity to outsource certain components of a business in order to remain competitive.

About the author::

Peter Dobler is a 20+ year veteran in the IT business. He is an active Real Estate Investor and a successful Internet business owner. Collect more free software and bonus content for your own web site at

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