In the book The Black Book of Outsourcing, authors and consultants Brown and Wilson identified what they call the top 10 major sins of outsourcing, that can sideline the success of any enterprise’s outsourcing initiatives.

In order to present a positive bent on these 10 major pitfalls, this piece would re-consider them as bases for the 10 Commandments of Outsourcing.

These are as follows:

1. Obtain commitment from executive management.
2. Develop an outsourcing communications plan.
3. Learn about outsourcing methodologies.
4. Recognize outsourcing business risks.
5. Consult outsourcing professionals
6. Dedicate the best and brightest internal resources.
7. Proceed carefully through each of the outsourcing phases.
8. Recognize the impact of cultural differences.
9. Acknowledge what it will take to ensure vendor productivity.
10. Implement a formal outsourcing governance program.

For today, let’s take a look into the first five commandments.

1. Obtain commitment from executive management.

Commitment from internal senior management is required in order that a business leadership team can adopt a hands-on approach to guide the outsourcing project teams to deliver the expected business benefits.

A member of executive management must be assemble a delivery team to ensure that offshore projects focus both on implementing technology, services, and delivering specific business benefits.


2. Develop an outsourcing communications plan

The outsourcing contract and the complexity of the services being delivered determins how partners communicate.

Simple, well-specified services require day-to-day operational contacts and formal performance reporting and invoicing. When the services’ complexity increase, more in-depth communication is essential.

In particular, this may include joint planning of service delivery and problem resolution, discussion of proposed innovations or changes in approach, consultation on staffing changes, and so on. In this case, day-to-day contacts can be supplemented by regular monthly reporting, to show performance against standards, pricing, and problems encountered.


3. Learn about outsourcing methodologies

Despite its status as a mainstream business activity, outsourcing remains under-researched and poorly understood. Without reliable information on business process outsourcing (BPO) markets, vendors and their capabilities, needs of different vertical segments, etc., many companies make serious mistakes.


4. Recognize outsourcing business risks

Risk identification is essential as risk affects priorities, costs and benefits because of its potential impact on an outsourcing initiative’s success.

When outsourcing all or part of a project, the contract must clearly state the company’s important risk factors in order to avoid a completed project that does not meet business needs. Also, internal and external assessments regarding skill levels and the successful outcomes of the project will determine which factors provide risk elements in the project staffing selection.


5. Consult outsourcing professionals

When internal knowledge in this area is lacking, companies engage an outsourcing consultant or firm to provide company readiness assessments, vendor search and selection, determine the best fit between buyers and vendors. This includes vendor search and selection, buyer readiness assessments, and contractual relationship structures.

Also, it is useful to bring in an independent consultant who can either objectively review the performance of in-house employees to investigate and rebid against an outsourcing supplier’s proposal in order to keep their department in-house.




Outsourcing Solutions, Inc. – Your Outsourcing Partner in Cebu, Philippines!


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