How to Outsource Virtually Everything |
Some outsourcing providers walk anxious clients through the process, offering co-sourcing or other hybrid models to ease them along the path. “We try to shape the relationship so the client can retain as much or as little control as possible,” says Hoogendoorn. “Our systems are built in a fairly modular fashion to enable clients to pick and choose what they want to do, so it’s not an all-or-nothing kind of thing for them.”
Business people agonize over loss of control for a good reason. Good outsourcing contracts set out in a great deal of detail who is responsible for what and when.But, ultimately, even though business owners are placing the execution of a task in an outsourcer’s hands, they are not outsourcing responsibility. They can’t.
“There is a tremendous amount of responsibility and liability involved in what we take on,” notes David Yager, CEO and chairman of HSE Integrated Ltd, a provider of industrial safety services. But ultimately, he says, “You can’t outsource responsibility and liability.” If an outsourcer drops the ball, and there are repercussions to your clients (or other stakeholders), it’s your name and your reputation that will suffer.
“Business owners ultimately have to do the work, make the decision and take responsibility for their decisions and actions, no matter what they outsource,” says Powerhouse International’s Taunya Woods Richardson. “Too many people give that power away to consultants. I know many business owners who have gotten themselves in trouble that way.”
And remember: outsourcing is not a panacea for all business woes. As Hoogendoorn puts it, “Outsourcing bad business processes isn’t going to make them better.”
Outsourcing good business processes or functions to a competent outsourcer is no guarantee of success either. Outsourcing arrangements can and do go bad. As Incite’s Jared Smith sees it, implosions happen for three pretty simple reasons. “The expectations were not aligned properly; that’s probably the most common one,” he says. Second, something in the personal relationship between the client and service provider goes sideways. “It’s important that there is a mutual relationship, a partnership between the client and us,” Smith stresses. “Sometimes, we have to fire a client because they do not treat account managers properly and we don’t want to put our staff into such an environment.” Plus, let’s face it, if you hate the client, you just don’t deliver.
Three: “Sometimes things change,” says Smith. The client may outgrow the service provider. Or vice versa: the service provider may refine or change its focus and find that it no longer matches the requirements of the client. There may be an acquisition, a change of control or a change of management. Whenever any of that happens, it’s time to rethink the relationship or contract.
But when expectations are aligned, the outsourcer and the client are well-matched, and the role each is to play well-defined and adhered to, outsourcing an expertise-intensive aspect of business may be the answer to a growing, understaffed SME’s prayers. So long as the business owner is able to cede a little bit of control, but not the responsibility.
