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OUTSOURCING EFFICACE
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Table of Contents
How to Build a Better Business with Outsourcing ............................................................................... 10 When to Outsource ......................................................................................................................... 10 What to Outsource .......................................................................................................................... 11 Finding the Right Contractors .......................................................................................................... 12 Making it Work ................................................................................................................................ 12 Counting the Cost ............................................................................................................................ 13 Facing the Challenges ...................................................................................................................... 13 Reaping the Benefits ........................................................................................................................ 14 Tips for outsourcing your small-business needs .................................................................................. 15 First, define your core ...................................................................................................................... 15 Move slowly and commit incrementally .......................................................................................... 15 Examples of functions to outsource ................................................................................................ 16 Outsourcing dos and don'ts : ........................................................................................................... 17 Know the outsourcing ABCs ............................................................................................................. 17 Top 5 Benefits of Outsourced Bookkeeping for Small Businesses ....................................................... 18 Outsourcing for Small Businesses .................................................................................................... 18 Outsourced Bookkeeping Benefits .................................................................................................. 18 1. You can focus on building your business. ......................................................................... 18 2. You can save money. ........................................................................................................... 18 3. You can free up some of your time. .................................................................................. 19 4. You can consult an expert that is now available to you. ................................................ 19 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 1

www.efficaciapersonale.com 5. You can benefit from the best of both worlds. ................................................................. 19 How to Afford Outsourcing as a Small Business .................................................................................. 20 Planning Affordable Outsourcing .................................................................................................... 20 Outsourcing Success Tips ..................................................................................................................... 23 5 Tips for a Successful Outsourcing Project ..................................................................................... 23 Outsourcing Success Tip #1: Outsource for the Right Reasons ......................................... 23 Outsourcing Success Tip #2: Thorough Vendor Selection Process .................................... 23 Outsourcing Success Tip #3: Make It Measurable ............................................................... 23 Outsourcing Success Tip #4: Follow Up ................................................................................ 23 Outsourcing Success Tip #5: Know When Your Going Over Your Head ........................... 24 8 Tips To Plan Your Outsourcing Program! .......................................................................................... 25 1. Select Your Targets .............................................................................................................. 25 2. Distance vs. Complexity ....................................................................................................... 25 3. Conditions to Consider ......................................................................................................... 25 4. Consider compensation issues ............................................................................................ 25 5. Improve As You Outosurce ................................................................................................. 25 6. Know Your Own Values ........................................................................................................ 26 7. Communicate with your Outsourcer .................................................................................. 26 8. Prepare for Your Next Contract .......................................................................................... 26 Top 7 Outsourcing Advantages ............................................................................................................ 27 Outsourcing Advantages: A Back-Office Operations Illustration ..................................................... 27 The Successful Vendor Selection Process ............................................................................................ 29 The Five Step Vendor Selection Process .......................................................................................... 29 1. Analyze the Business Requirements .................................................................................. 29 2. Vendor Search ....................................................................................................................... 29 3. Request for Proposal (RFP) and Request for Quotation (RFQ) ...................................... 30 4. Proposal Evaluation and Vendor Selection ........................................................................ 30 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 2

www.efficaciapersonale.com 5. Contract Negotiation Strategies .......................................................................................... 30 6. Contract Negotiation Mistakes ............................................................................................ 31 Improve Outsourcing With Onshore Projects! .................................................................................... 31 Four Factors For Choosing An Outsourcing Location ........................................................................... 33 How to Develop a Plan for Outsourcing .............................................................................................. 36 Total Outsourcing Totally Misses the Point! ........................................................................................ 38 Avoiding the Dark Side of Help Desk Outsourcing ............................................................................... 41 Top 6 Outsourcing Disadvantages ....................................................................................................... 44 Outsourcing Disadvantages: Reasons That Outsourcing is Bad for Your Company ......................... 44 1. Loss Of Managerial Control ................................................................................................. 44 2. Hidden Costs ......................................................................................................................... 44 3. Threat to Security and Confidentiality ............................................................................... 44 4. Quality Problems ................................................................................................................... 45 5. Tied to the Financial Well-Being of Another Company .................................................... 45 6. Bad Publicity and Ill-Will ...................................................................................................... 45 What to Look for When Outsourcing Your Marketing ......................................................................... 46 Outsourcing: A Strategic Solution ........................................................................................................ 48 Outsourcing: Why and What ........................................................................................................... 48 "Reason for Outsourcing .......................................................................................................... 48 Functions Outsourced ............................................................................................................... 48 How to Communicate with Your Outsourcer ...................................................................................... 50 SLAs and Metrics .............................................................................................................................. 50 Management Reports ...................................................................................................................... 50 Monthly Agenda .............................................................................................................................. 51 Other Meetings ................................................................................................................................ 51 Attendees ........................................................................................................................................ 51 Ratcheting Up Outsourcing Success .................................................................................................... 52 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 3

www.efficaciapersonale.com Outsourcing Experiment: Dont Just Move, Improve! ......................................................................... 56 Outsourcing Experiment: Kill Email & Take Back Time ........................................................................ 58 15 essential tips for outsourcing decision making ............................................................................... 60 Seven steps to effective outsourcing measurement ........................................................................... 65 A step-by-step approach to outsourcing management ................................................................... 65 7 outsourcing nightmares - here's how to avoid them ........................................................................ 70 Outsourcing nightmare No 1: Outsourcing employee exodus ............................................ 70 Outsourcing nightmare No. 2: Offshore app dev delays shut window of opportunity .... 71 Outsourcing nightmare No. 3: Offshore communications breakdown ............................... 72 Outsourcing nightmare No. 4: Poor quality, no recourse for refund ................................. 72 Outsourcing nightmare No. 5: Unexpected overhead of outsourced management ........ 73 Outsourcing nightmare No. 6: Metrics without enough granularity to be meaningful .... 74 Outsourcing nightmare No. 7: Downtime and disorganisation ........................................... 75 11 Steps to Successful Outsourcing: A Contrarian's View ................................................................... 76 10 Tips for Stress-Free Outsourcing .................................................................................................... 80 1. Create how-to process documents and/or checklists for all recurring tasks in your business. ..................................................................................................................................... 80 2. Always include a project title in your requests that is clear and descriptive. .............. 80 3. Put your due date in the title or subject line, as well as in the body of the document. ..................................................................................................................................................... 80 4. Start any task request with a short overview of what youre trying to accomplish. ... 81 5. Use bullets or numbered lists of steps. ............................................................................. 81 6. Send each task or project in a different email or request. ............................................. 81 7. Be an active project manager. ............................................................................................ 81 8. Specify a maximum number of hours or dollars. ............................................................. 81 9. Set expectations about how and when you expect reports or updates. ...................... 81 10. Some things require a phone call. ................................................................................... 81 When Outsourcing Makes You Go "Ouch!" ......................................................................................... 83 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 4

www.efficaciapersonale.com Behavioral Control ..................................................................................................................... 83 Financial Control ........................................................................................................................ 83 Your Business Relationship ...................................................................................................... 84 Get Your Ducks in a Row ......................................................................................................... 84 Top 10 Tips for Outsourcing Success ................................................................................................... 85 Do What You Do Best and Hire the Rest .......................................................................................... 85 Top 10 Outsourcing Trends by Small Businesses ................................................................................. 88 Why, When, What and How to Outsource Tasks ................................................................................ 92 Why, When, What and How to Outsource Tasks ..................................................................... 92 Why Outsource Tasks? .................................................................................................................... 92 When to Outsource Tasks ................................................................................................................ 92 What Tasks to Outsource? ............................................................................................................... 93 How to Outsource Tasks .................................................................................................................. 93 When to Outsource ............................................................................................................................. 94 6 top tips on growing your business with outsourcing ........................................................................ 97 5 Out-of- the-Ordinary Outsourcing Trends ........................................................................................ 99 Outsourcing Pitfalls ............................................................................................................................ 101 Can Outsourcing be Shoreless? ...................................................................................................... 104 The Benefits of Outsourcing .............................................................................................................. 107 1. Get access to skilled expertise ....................................................................................... 107 2. Focus on core activities ................................................................................................... 107 3. Better Risk Management ................................................................................................ 108 4. Increasing in-house efficiency ....................................................................................... 108 5. Run your business 24X7 ................................................................................................. 108 6. Staffing Flexibility ............................................................................................................ 108 7. Improve service and delight the customer .................................................................. 108 8. Cut costs and save BIG! ................................................................................................. 108 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 5

www.efficaciapersonale.com 9. Give your business a competitive edge ........................................................................ 109 10. See an overall increase in your business ................................................................... 109 The 5Ws of Outsourcing .................................................................................................................... 110 Who Should Outsource? ................................................................................................................ 110 What will I benefit from outsourcing? ........................................................................................... 111 What should I Outsource? ......................................................................................................... 111 When should I Outsource? ............................................................................................................ 112 Where should I Outsource? ........................................................................................................... 112 The Ethics of Outsourcing .................................................................................................................. 113 Ethical dilemma in Offshore Outsourcing ...................................................................................... 113 Quality of Service ........................................................................................................................... 114 Work Environment ........................................................................................................................ 114 Security Concerns .......................................................................................................................... 114 Cultural differences ....................................................................................................................... 115 Top 5 Outsourcing Challenges and Solutions in Present Times ......................................................... 116 Top 5 Outsourcing Challenges and Their Solutions ................................................................ 116 Challenge# 1: .............................................................................................................................. 116 Solution: ....................................................................................................................................... 116 Challenge# 2: .............................................................................................................................. 117 Solution: ....................................................................................................................................... 117 Challenge# 3: .............................................................................................................................. 117 Solution: ....................................................................................................................................... 117 Challenge# 4: .............................................................................................................................. 117 Solution: ....................................................................................................................................... 117 Challenge# 5: .............................................................................................................................. 118 Solution: ....................................................................................................................................... 118 The Pros and Cons of Outsourcing .................................................................................................... 119 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 6

www.efficaciapersonale.com What does outsourcing and offshoring mean? ............................................................................. 119 What are the effects of outsourcing? ............................................................................................ 119 What are the pros and cons of outsourcing? ................................................................................ 119 The pros of outsourcing ................................................................................................................. 119 The cons of outsourcing ................................................................................................................ 120 9 Guidelines to Secure Outsourcing .................................................................................................. 121 1. Having a good security policy ............................................................................................... 121 2. Selecting the right outsourcing vendor ................................................................................ 121 3. A sound privacy and intellectual property policy ................................................................ 121 4. Protecting your data ............................................................................................................... 121 5. Providing Education on handling data ................................................................................. 121 6. The rule of least privilege ...................................................................................................... 121 7. Leak-Proof traffic .................................................................................................................... 121 8. Ensuring application and network security audits .............................................................. 122 9. Ensuring that prevention technologies are employed? ..................................................... 122 Experience Secure Outsourcing with Flatworld Solutions ...................................................... 122 Top Ten Rules for the First Outsourcing Project ................................................................................ 123 How to Successfully Manage your Offshore Outsourcing Business Ventures ................................... 125 1. How to manage cost risks ..................................................................................................... 125 2. How to manage communication risks .................................................................................. 125 3. How to manage knowledge transfer risks ........................................................................... 125 4. How to manage performance risks ...................................................................................... 126 5. How to manage outsourcing risks ........................................................................................ 126 6. How to manage a crisis ......................................................................................................... 126 Invest in the outsourcing relationship ........................................................................................... 126 Get your company organized before outsourcing ......................................................................... 126 Partner with Flatworld Solutions today! ................................................................................... 127 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 7

www.efficaciapersonale.com Will Outsourcing Continue to Grow in the Years to Come? .............................................................. 128 Cost savings will continue to be a major advantage of outsourcing ............................................. 128 Outsourcing will focus more on core business activities ............................................................... 128 Standardized outsourcing solutions will be favored over customization ...................................... 129 Outsourcing of smaller projects will continue to be an important benefit of outsourcing ........... 129 Outsourcing and cloud sourcing will merge and grow exponentially ............................................ 129 Small Business Outsourcing Tips For A Beginner ............................................................................... 130 Evaluate what needs to be outsourced. ........................................................................................ 130 Determine outsourcing budget. .................................................................................................... 130 Get ready for challenges. ............................................................................................................... 130 Dont choose outsourcing services blindly. ................................................................................... 131 Begin with micro outsourcing. ....................................................................................................... 131 Keep sufficient staff to act as a liaison. ......................................................................................... 131 Check out hidden cost. .................................................................................................................. 131 Seek affordable services. ............................................................................................................... 131 Check their credentials. ................................................................................................................. 131 Check the quality of services. ........................................................................................................ 131 Inspect authenticity. ...................................................................................................................... 132 Verify customer support. ............................................................................................................... 132 Ten Tips for Superior Outsourced Relationships ............................................................................... 133 31 Tips For Successful Outsourcing ................................................................................................... 135 Come to an Agreement ................................................................................................................. 135 Protect Your Business .................................................................................................................... 135 Client Relations .............................................................................................................................. 136 Aside from the Work ..................................................................................................................... 136 3 Ways to Outsource Your Business Tasks ........................................................................................ 137 1. Outsourcing Portal .............................................................................................................. 137 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 8

www.efficaciapersonale.com 2. Crowdsourcing ..................................................................................................................... 137 3. Economy Outsourcing ........................................................................................................ 137 Take Advantage of Other Companies Outsourcing Needs ............................................................... 138 A Case Study ............................................................................................................................ 138 An Example of a Possible Business ....................................................................................... 138 Take Advantage of Outsourcing Opportunities ................................................................... 139 How To Start Outsourcing With Freelancer ....................................................................................... 140 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 9

www.efficaciapersonale.com NANCY MANN JACKSON http://www.entrepreneur.com/article/204652

How to Build a Better Business with Outsourcing


When Laura Lee Sparks left her job as a law firm manager to launch her own business, she knew from the beginning that there were certain tasks she didn't want to handle. The owner of Legal Marketing Maven--a firm that helps law firms streamline their practices through outsourcing--Sparks practiced what she preached from the start, hiring an outside bookkeeper and slowly adding to her virtual team of contractors. Within months, her business revenues reached six figures. "Most entrepreneurs have great talents but many times they think they can do it all," Sparks says. "That can really stall the growth of the business. By outsourcing the day to day backoffice tasks, the business owner has more time to focus on generating income." Entrepreneurs have long seen outsourcing as a strategy reserved for big business, but technology has made it a more accessible tool for small businesses--and for some small firms, outsourcing has made a powerful impact on their growth, productivity and bottom lines. "More small businesses are outsourcing tasks these days because technology has advanced to the point of professionals being able to work from anywhere in the world, coupled with the availability and accessibility of extremely qualified professionals who have decided or been forced to leave the corporate world, [such as] virtual executive assistants, marketing directors, graphic designers, transcriptionists, paralegals, web designers, HR consultants, bookkeepers, PR directors, IT specialists, and the list goes on," Sparks says. "These freelancers come on board as subcontractors and save the small business owner the burden of paying overhead associated with payroll taxes and expenses such as health insurance and worker's compensation, as well as the space constrictions that growing a company in-house can present." Taking the first steps toward outsourcing can be time-consuming, but figuring out how to build your business with help from outside professionals can offer increased efficiencies and economies of scale. "Progressive entrepreneurs realize the unstoppable power of outsourcing to handle aspects of their business that are essential but simply don't make sense for them to deal with personally," says David Walsh, entrepreneur and author of Source Control, an e-book on effective small business outsourcing. "Small business, augmented by a global pool of human capital, can compete directly with the biggest players in their space, and win."

When to Outsource
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www.efficaciapersonale.com For every company, the right time to outsource is different. Some businesses have in-house staff to handle daily activities, but may need outside help to undertake new projects that don't warrant another full-time employee. When you and your current employees are unable to manage the day-to-day business of your company and build the business satisfactorily, it may be time to consider outsourcing. For Tonya Thomas, president of The Small Office Assistant, the right time was when she realized that although she wanted her business to grow, she had no time left in her day to pursue that growth. "At first I felt like I was the only person who could do the work efficiently; I wanted control over everything," Thomas says. "But I wanted my business to grow and in order to do that I had to let go and start delegating." Letting go paid off: The first year she began using contractors to help carry her workload, Thomas doubled her company's revenue. For very small businesses, Sparks recommends outsourcing from the very beginning. She suggests starting out with a bookkeeper and a virtual assistant, and growing the team from there. In her own business, Sparks now contracts with a virtual bookkeeper, a web designer, a ghost writer, a graphic designer, an executive assistant and a project manager.

What to Outsource
Chances are you're already outsourcing some business tasks, such as payroll administration or background and criminal checks for employment. And these days, almost any task can be outsourced, with so many qualified professionals leaving the corporate world to work as freelancers or contractors. However, just because you can outsource a task doesn't mean you should. "Don't outsource something just because you don't want to do it," says Jim Lanzalotto, principal at Scanlon Louis, a marketing and strategic outsourcing company. "Sometimes there are things you don't want to do but they are important to your core business." Before choosing which tasks you can farm out, take a hard look at your business and determine your strengths and values. "Small businesses must identify their core competencies and capabilities and focus their own R&D, talent management and resources on being the best in their industry at these," says Marc Resnick, Ph.D., a small business consultant and director of the Institute for Technology Innovation at Florida International University. "Outsourcing any aspect of [these tasks] would be a big mistake because they would cease to offer anything that their own customers couldn't get elsewhere. So a small business that focuses on product design should not outsource anything related to developing its internal design talent or their design activities. But they should investigate all opportunities for outsourcing tangential processes like payroll services, IT and so on." The types of tasks that are best outsourced fall into three general categories, according to Gregg Landers, director of growth management at CBIZ MHM, the nation's eighth largest accounting and business services provider. They include: Highly skilled, or executive, expertise. For example, you may not need to pay a CFO's salary, but you could have a CFO-level person to come in a few times each month to provide financial analysis and ensure that the bookkeeper is handling the books well, Landers says. Highly repetitive tasks. Accounts payable, data entry and shipping inventory could fall into this category. Specialized knowledge. "An example might be the IT support for your accounting system or your network," Landers says. "You may not be able to afford or need a full-time IT person, and it is easier to change to an outsourced provider with the right skill set as your IT needs change." La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 11 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

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Finding the Right Contractors


Before handing over the reins, be sure you're working with the right partner. While technology makes it much easier than it once was to find capable, reliable outsource providers, the selection process is still vitally important. A good starting place is your own network; ask other business owners or your accountant, lawyer, or banker if they can recommend a provider offering the services you need. Online networks like LinkedIn and Twitter make it easy to expand your personal networks and to ask for recommendations. In the absence of a good recommendation from a friend or acquaintance, there are other options. Thomas located outsource providers by placing ads on a work-at-home website and by submitting requests for proposals to professional trade organizations. Lanzalotto says that while local Chambers of Commerce usually can't recommend one provider over another, a professional association or trade group will often recommend the right partner for your needs. A number of online services such as oDesk, BidModo and eLance serve as virtual marketplaces for contractors and business owners to connect and begin working relationships. Jack Groetzinger, co-founder of SeatGeek.com, a Manhattan-based company that forecasts ticket prices for sports and music events, works regularly with contractors through oDesk to gather photographs and collect ticket price data. Along with a full-time staff of seven, SeatGeek now works with contractors scattered from the Philippines to Pine Bluff, Ark., and Aurora, Colo. When hiring freelancers, Groetzinger says he pays most attention to the feedback they've received from other employers. "Finding the right vendor means having access to the right information about the prospective contractors," says Zack Fuentes, CEO of BidModo. Outsourcing sites usually allow you to see how previous clients rated prospective vendors' work, as well as detailed profiles of the vendors. Whether you use a web-based marketplace, a personal referral, or a personalized matchmaking consultant, the key to identifying the right contractor is to know exactly what you're looking for. "First identify exactly what performance metrics are important for each task [you] want to outsource," Resnick says. "Some outsourcing providers focus on speed at the expense of quality or vice versa. This is fine as long as there is a good match between what the small business wants and what the [provider] specializes in. But many small businesses don't realize that there are large differences among outsourcing providers and select the wrong ones. An open and clear conversation with potential contractors regarding these key performance metrics is essential."

Making it Work
After you've found a provider, your work isn't over yet. Even after you've checked references, "don't be afraid to put a little extra time creating a specific contract that outlines exactly what performance is expected," Resnick says. "Use incentives to motivate the outsourcer to focus on what is most important to you rather than their own preferences or their assumptions about what you want." La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 12

www.efficaciapersonale.com Communicate your expectations and the steps included in the job clearly; never assume that contractors are thinking what you're thinking. "When there is a problem [with the work], I am often the one to blame, as my instructions may not have been clear enough," says Jeremy Belcher, owner of FoxyMelody.com, who has hired numerous contractors through eLance. "It is very important that the requirements and expectations are laid out in the beginning, and that nothing is left to assumption." Even when you clearly state your expectations, "there will be a learning curve on the provider's side," Belcher adds. "Hang in there. The provider will get better, and you will have the freedom to focus on more important tasks." Your final responsibility as a successful outsourcer is to step back, relinquish control, and allow your new team members to do the job you've hired them to do. "You need some measure of trust," Resnick says. "If you are going to micromanage all of your outsourcing, the savings in management attention and time that is the whole point of outsourcing is lost." If you're used to doing everything yourself, consider delegating the management of outsourcing relationships to another member of your management team, a move that may help you let go, according to Resnick. "It's less about logistics and entirely about mindset," Walsh adds. "Many owners take pride in having the world on their shoulders and their entire organization buried in their mind. Knowing your business is critical, but keeping yourself indispensable is reckless and unscalable. Realize that removing yourself from low-level operations is the smartest investment you can make in the long-term success of your business."

Counting the Cost


So what can you expect to pay a contractor for allowing you to rise above day-to-day tasks and build a better business? It depends on the type of work you're buying, the skill level and location of your provider, and your own preferences. For instance, SeatGeek's Groetzinger says that through online hiring sites, you can find contractors in developing countries who will work for less than $1 per hour. While U.S.based contractors will likely require higher fees, they may be lower in rural areas than in metropolitan cities where the cost of living is greater. "'You get what you pay for' is true, wherever you go in the world," Walsh says. "Always pay someone what they're worth, regardless of location but accounting for and leveraging currency differences that often work in your favor. [Place] value [on] outcomes over hours. If you don't get the outcome you need, it doesn't matter how much time your contractor spent along the way. Consider distinct task-based agreements while you're evaluating new providers, and transition to a fixed-cost retainer once you're confident in their ability to consistently deliver."

Facing the Challenges


While outsourcing can yield great advantages for a small company, it's not without challenges. If you choose to work with offshore providers, language barriers and time zones can be difficult to deal with. However, Walsh says that focusing on making your own communications clear can help overcome confusion for those who are not native English La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 13 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com speakers. And "time zones create more opportunity than inconvenience, as you can extend your productive hours by handing tasks over to someone during their workday," Walsh says. "Assign a task at night, and awake to find it complete and waiting for you." Just as when you hire a new employee, there are security risks involved when handing tasks over to an outsourced provider. "The challenge is to outsource functionality securely, in a manner that does not put employee personal information or customer data at risk," says Jonathan Gossels, president of SystemExperts, a security and compliance consulting firm. If contractors are handling credit card data, Gossels recommends reviewing their Payment Card Industry Data Security Standard compliance statement; if they are handling health or benefits information, review their HIPAA compliance statement. For a general sense of the contractor's security policy and practices, review their ISO 27002 compliance statement. "The most important step a business owner can take to protect his data is to only provide the outsourced service provider with the absolute minimum data necessary for the provider to do its work," Gossels says. The Small Office Assistant's Thomas discovered the importance of protecting client data when one of her contracted virtual assistants stole a client from Thomas for her own virtual assistant business. Now, rather than working directly with clients, Thomas' contractors communicate with them anonymously through the company's online system and Thomas herself serves as the sole client contact.

Reaping the Benefits


Although there are risks, outsourcing ultimately offers business owners great advantages. The process allows you to build a team of skilled professionals without adding the expense of full-time employees, and to avoid getting bogged down with tasks that can be completed without your attention, Sparks says. It's an affordable, proven strategy for growing your business without letting it take over your life. "Handing off work forces you to objectively, ruthlessly and systematically consider your activities and the steps taken to perform them," Walsh says. "Defining a process flushes out inefficiency." When you outsource, you can focus your time, attention and resources on your company's core competencies--and spend your time setting new goals and finding ways to achieve them.

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www.efficaciapersonale.com Joanna L. Krotz http://www.microsoft.com/business/en-us/resources/management/recruiting-staffing/tips-for- outsourcing-your-small-business-needs.aspx?fbid=xSCHK6A0tjM

Tips for outsourcing your small-business needs


Yes, small businesses can benefit from outsourcing too. More and more of them are turning over parts of their operations to outside experts, allowing owners to focus on critical needs and growth. Following the trend of larger companies, small-business owners are outsourcing a range of services, from HR to finance and accounting to customer services. But the outsourcing process requires some time and investment to find the right vendor, build a working relationship, and allow your employees to adjust. Here's how to evaluate whether outside experts can perform better, faster or more costeffectively than your in-house staff. You'll also find advice about charting a path through the come-hither promises often made by outsourcing services.

First, define your core


Generally, the smart strategy is to hold on to operations or areas that define the core mission of your business. Then, consider outsourcing the other operations that are not as strategic. If, for instance, your point of difference is customer service, make sure you have enough friendly and attentive full-time employees to make good on that. If, however, you promise rock bottom prices, then relying on an outsourcer, such as a Web-based virtual assistant, an automated phone system or an overseas call center, might make more sense. Also, think through potentially outdated conventions about on-staff specialists, especially given the reach and effectiveness of today's desktop technology. Traditionally, small businesses have outsourced payroll and human resources services. But owners can now tap outside facilitators for a much greater range of services. For instance, entrepreneurs with strong sales often assume they need a full-time bookkeeper to oversee the books. But, in fact, you can be running a $5 million company and still not really require a full-time bookkeeper. Such services have little to do with the volume of sales and more to do with the level of accounting activity, such as invoicing, bill paying, payroll and the like. Companies with a full-time bookkeeper can save about $30,000 a year by using outsourced bookkeeping services, say, a half-day a week.

Move slowly and commit incrementally

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www.efficaciapersonale.com Outsourcing's advantages will vary with the services, the kind of business you run and, of course, the quality of your provider. It's worth your while to move slowly and commit little by little. Don't sign two-year contracts before testing performance and the relationship. To get a feel for the process and to accustom your staff to the idea, first try outsourcing one stand-alone project, and then move on to hiring professionals for other areas or ongoing needs. "With project professionals, there are no long-term contracts for unnecessary services and companies," says Chris Hagler, national director of strategic services for Resources Global Professional, a Costa-Mesa, Calif., concern that provides specialists and contingency experts in finance and accounting, information technology, human resources and legal services. "Project professionals are 'executers' as opposed to traditional consultants who do not necessarily roll up their sleeves and get the job done," he says.

Examples of functions to outsource


The roster of choices for high performing, affordable outsourcing services keeps growing. Here are some examples of functions you might consider outsourcing, to boost your day-today operations. Specialist and expert help. Elance Online (elance.com), based in Sunnyvale, Calif., for example, offers a range of services for small business projects. It provides access to thousands of professionals around the world for services, such as graphic design and multimedia presentations, engineering, sales and marketing, writing and translation, and more. Public relations services. Most small businesses cannot afford a PR pro full-time and likely don't need one. Much of the news or publicity that smaller companies seek is generated when a new product launches or to support the chief executive officer's profile as an expert in the industry, or to call attention to expanded services or new hires and so on. To find a PR company that can work well for you, look for someone who understands your industry and takes on smaller-company clients. Virtual assistants. Virtual assistants, or independent entrepreneurs who provide administrative, creative or technical support are a growing phenomenon. They work on a contractual basis via online or electronic communications, handling functions, such as keeping your schedule or your files or your customer intelligence database up to speed. You can find out more by visiting the nonprofit International Virtual Assistants Association (www.ivaa.org). Expertizing, based in Newton, Mass., uses virtual assistants for a variety of projects. "We're a small company that helps people achieve media attention for their businesses, and have outsourced a lot of work to several virtual assistants," says CEO Fern Reiss. "It completely changed the way we operate. We meet 'live' once a month for a long catch-up, and in between correspond via email and occasionally by phone. We have increased productivity by about 30% to 40%, and have finally gotten many of our back-burner projects out the door."

Outsource brokers.

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www.efficaciapersonale.com When you outsource services or projects, you still need reliable managers to track progress and monitor results. Increasingly, there are third-party services that will manage your outsourcers for you. These brokers, exchanges and networks can recruit, interview and manage the services you need. For instance, ComputerRepair.com based in Boca Raton, Fla., runs a Web site that lets businesses across the country quickly find inexpensive PC support services. The company claims cost savings of 50% for IT service procurement.

Outsourcing dos and don'ts :


Try fixing whatever's not working on your own first. You may have internal resources that can work better than you think. Carefully evaluate what really can be outsourced. Generally, projects that require team interaction or brainstorming don't work too well. Self-contained tasks or projects are more suited to outsourcing. Consider management costs. Sometimes services look good on paper but you end up eating the savings in training and oversight costs. Be prepared for challenges. It takes a while to build the relationship and synchronize the timing. Don't walk in blind. Start with some paid consulting, if need be, so you can ask the right questions in choosing a vendor and keep knowledgeable tabs on performance. If you outsource significant hunks of your operations, consider having a staff employee(s) to act as a liaison. You want to outsource functions but not accountability. Watch out for hidden costs. These may include paying layoff-related expenses, overtime costs for remaining employees who may now have more work to do, and telecommunications costs for remote workers.

Know the outsourcing ABCs


Before you ramp up your outsourcing services, learn these outsourcing ABCs from Kevin Gregson, chief executive officer of Sherwood Solutions, a business advisory firm. Alignment: Is outsourcing the right move for your business?Business case: Have you taken all costs into consideration?Culture: Can you bridge the cultural difference between your company and the outsourcer?Delivery: How will you define success? It might take a bit of time to get right, but the benefits of outsourcing can be enormous. Check out your operation to see how it can work for you. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 17

www.efficaciapersonale.com PAUL MARSDEN http://yfsentrepreneur.com/2013/08/23/top-5-benefits-of-outsourced-bookkeeping-for-small- businesses/#axzz2dIa0ydhP

Top 5 Benefits of Outsourced Bookkeeping for Small Businesses


Starting a business can be a time consuming and stressful endeavor. Finances are likely to be tight and you will want to keep costs to a minimum in order to give your small business the best chance for long-term success. It is important that you dont take on too much of the workload, but on the other hand hiring new employees is a big commitment and can leave you with a large payroll. Hiring employees to carry out the specialist tasks in your business, such as payroll and bookkeeping, is increasingly being seen as an unnecessary solution. This is partly due to the growing responsibilities and costs surrounding employing people for such tasks. More and more small business owners are now turning to outsourcing as their preferred solution.

Outsourcing for Small Businesses


Outsourcing is a way of getting an expert from outside of your business to deal with a specialist task. Many aspects of your business can be outsourced, including: marketing, payroll, bookkeeping and copywriting. But no matter what the task is, outsourcing is an affordable way to cut down your workload and give you one less thing to think about so you can get on with running your business.

Outsourced Bookkeeping Benefits


Lets look at bookkeeping as an example. As a small business owner you could try to handle all of your companys accounting work yourself. It may be the cheapest option, but it may be more cost-effective to alleviate yourself from the responsibility of this and outsource it. Here are five benefits to outsourcing your bookkeeping needs: 1. You can focus on building your business. By outsourcing you will have the time to pursue other business opportunities rather than spending late nights doing bookkeeping tasks. 2. You can save money. Outsourcing is the most cost-effective solution to your bookkeeping tasks. By letting an expert outside of your business take on these tasks you will only be paying for what you need, as opposed to getting someone in-house to complete these tasks.

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www.efficaciapersonale.com 3. You can free up some of your time. By outsourcing your bookkeeping to a reputable company you can rest assured that the jobs will be done on-time and correctly. This will free you from the stresses of doing these tasks in-house. 4. You can consult an expert that is now available to you. Outsourcing your bookkeeping needs will give you access to an expert who will be up to date on regulatory requirements and will be fully able to make sure the job is done correctly. In addition to this you will be able to get advice from these experts on a pay-as you-go basis; never paying for more than you require. 5. You can benefit from the best of both worlds. Most business owners are glad to free up time spent on bookkeeping and leave it in the hands of an expert, who lives and breathes their job. By outsourcing your bookkeeping you will have more time to run your business but also have the security of knowing it is in safe hands.

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Teresa, TechFlash http://www.wikihow.com/Afford-Outsourcing-as-a-Small-Business

How to Afford Outsourcing as a Small Business


Outsourcing is a business practice where you hire outside contractors to help with a function or project. Contractors are not considered employees; they are either independent freelancers or another business that has been given a paid contract to deliver a product for set period of time. Outsourcing is not reserved for companies with large budgets. It is usually essential for a small business to contract with providers occasionally because a small workforce is not likely to be able to do all the functions required to have a successful business. Small businesses often outsource IT, bookkeepers, search engine optimization (SEO) articles, social media marketing, graphic design and more. Outsourcing instead of hiring new employees, often frees up fixed costs and turns them to variable costs. It can often save a business money in the long term. This article will tell you how to afford outsourcing as a small business.

Planning Affordable Outsourcing


Analyze your core mission. This should be identified in your business plan. Make sure your current employees are covering strategic parts of your company's plan, and then you can look to outsource the things that are not vital for day to day business operations. Outsourcing takes time to implement, and it occasionally requires some training, so it is important that you don't put your vital functions in the hands of someone with less accountability than employees. After you have your core business mission taken care of, move on to increasing the function and efficiency of your business through outsourcing. Analyze your staff's abilities before making plans to outsource. Call a meeting or do performance where you ask your staff what other skills they have that are not currently being used. For example, someone you have hired as a sales associate may also be adept at social media marketing, so you can appoint them to do 1 hour of it per day. Noting your staff's capabilities has 3 unseen benefits. You get a better grasp of the capabilities your company has, allowing you to increase your capabilities without adding employees. You can identify any weak areas of your labor force, and layoff employees that are not doing their job. Employees may also enjoy diversifying their job description. A new task gives them added experience, a more valuable place in the company and it allows them to break up their duties. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 20

www.efficaciapersonale.com Meet with upper management to prioritize and strategize projects that could be outsourced. Prioritize these projects, according to cost and timeline. Assign new projects to current employees, if you have identified new skills and they have the time to do them. Common ways that small businesses outsource are customer service/help desk, IT, online/print marketing, graphic design, public relations/reputation management, database management, brokers, bookkeepers, website hosting, legal services and virtual assistants. Identify hours that you and your employees spend doing projects that could be outsourced. Calculate, according to hourly wage, the money spent doing projects that could be outsourced. Separate the amount of time and money according to project, to see what company money and time could be better spent elsewhere. These are "lost" hours that are rarely calculated. Choose a value for your time, as well as your employees' time. Doing a job for hours that you are not proficient at may be costing you hundreds or thousands of dollars each week. If your time can be better spent increasing sales, business contracts or more, then you can identify ways that you can save money by outsourcing. Create an outsourcing budget. This can be money that is not being used in current projects, leftover project money and/or the sum total of money that can be saved if you and your current employees are free to help customers or actively increase sales or services. Starting Affordable Outsourcing Start by outsourcing 1 project at a time. It is important not to do all your projects at once, because it will be chaotic for the company and you are paying all your variable costs at once. Assigning 1 person to lead the outsourced project and doing things slowly will result in fewer mistakes and risks. Assign an hourly or project cost according to your budget. The person who leads the project should be aware of the cost when choosing a contractor. Keep aside a portion of the overall budget for employee training and materials, if necessary. Find contractors for your project. There are an increasing number of contractors or freelancers in the workforce today, so the rule of supply and demand is on the small business' side. Many people work from home, so they have fewer overhead costs and can charge affordable prices. Post an ad online. Use Craigslist, Angie's List, Simply Hired, Indeed or another website to post your contract job. You will get many responses, so be sure to keep the application time between 2 weeks to 1 month. Instead of writing "Depends on Experience (DOE)" in your salary section, ask the contractor to bid on the proposal. Choose someone with experience that fits within your budget. Get recommendations from other businesses. Many small businesses are already outsourcing. If you like the look of someone's marketing, graphic design or another portion of their business, ask if they are using a contractor. Recommendations are the best way to La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 21

www.efficaciapersonale.com find experienced people quickly. You can go to the contractor directly and ask for a quote or offer a job. Look online for a service. A simple Internet search will list dozens, if not hundreds, of providers. Ask for a quote, a demo and ask to speak to people who currently use their product. If you are outsourcing something that you plan to use throughout the year, such as IT, web hosting or customer service, make sure there is a satisfaction guarantee, so that you can get out of a contract if you are not happy. Keep tabs on performance and hidden costs. Have your project leader communicate regularly about progress by email, Skype, phone and/or in person. In most cases, they will be happy to work with you and adjust their schedules if there are problems. Advocate an on-time delivery of the contract. If the contractor is providing a product, such as a website, press release, or brand, make sure you stick to a schedule. Allowing a contractor to operate without a time limit is a costly mistake. Make sure training is included in the delivery of the final product, if applicable. This is often the case with websites or IT. Make sure a few people in the company know how to use the information or product that has been provided, so that you aren't relying on 1 person or the freelancer, if an issue arises. Evaluate the success of the project. Launch your next freelance project after the last 1 is completed. Once you have the process in place, you can begin scheduling freelance projects on a yearly timeline, according to what your business can afford. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 22

www.efficaciapersonale.com James Bucki http://operationstech.about.com/od/outsourcing/tp/Outsourcing_Success_Tips.htm

Outsourcing Success Tips

5 Tips for a Successful Outsourcing Project


Outsourcing success is dependent upon how well you manage the process before and after the outsourcing contract is signed. Many companies award the outsourcing contract to the lowest bidder without understanding what it means to the business and without performing a complete vendor selection process. When things start to fall apart, like missed delivery dates, quality problems occur or bad customer service, the blame-game starts and everyone runs for cover. The following outsourcing success tips will help ensure that outsourcing will succeed in your organization and you will achieve the results you desire. Outsourcing Success Tip #1: Outsource for the Right Reasons Taking a bad business process and outsourcing it only makes the problem worse. Without a doubt, an outsourcing vendor should add value to your business, but should not be relied upon to fix the problems inherent in your business. For example, if your IT department consistently misses deadlines because users keep changing their minds, outsourcing this function will result in higher costs and higher levels of frustration.

The Essential Outsourcing Decision Guide

Outsourcing Success Tip #2: Thorough Vendor Selection Process In the Deloitte Consulting - 2008 Outsourcing Report 35% of executives responded that they wished they would have "Spent more time on vendor selection and vendor evaluation" before signing an outsourcing contract. The outsourcing decision can be distorted by emotions and manipulated by company politics. A successful vendor selection process will remove the emotions and control the company politics. The Successful Vendor Selection Process Outsourcing Success Tip #3: Make It Measurable Also, in the Deloitte Consulting - 2008 Outsourcing Report 49% of executives responded that they should have "Defined realistic service levels that align with business goals". If you don't analyze and define quality measurements and/or service levels, how will you know if your outsourcing vendor is performing to your standards?

How to Analyze and Define Business Requirements

Outsourcing Success Tip #4: Follow Up After the newness of the outsourcing relationship wears off, it is human nature to sit back and enjoy the ride for awhile. Unfortunately, this leads to complacency and attention to La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 23

www.efficaciapersonale.com performance can be forgotten. In order to avoid these symptoms, set a timetable to review your outsourcing vendor's performance. Also, appoint a manager or executive that will be held responsible for the follow up. If needed, send your staff to be trained in vendor management skills and techniques (check with local colleges or universities). This strategy will also yield the ability to deal with unforeseen circumstances on a timelier basis and mitigate the risk associated with outsourcing. Outsourcing Success Tip #5: Know When Your Going Over Your Head Seek an experienced advisor or consultant if your outsourcing project involves any of the following circumstances:

The project is big enough that it will expose the company to significant risks Company politics are jeopardizing the success of the project Management does not have the experience in vendor evaluation and vendor selection

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www.efficaciapersonale.com Chris Niccolls http://outsourcing.about.com/od/feasibility/tp/8-Tips-To-Plan-Your-Outsourcing-Program.htm

8 Tips To Plan Your Outsourcing Program!


When you're ready to outsource, there are a lot of issues to think about, and a lot of things that can go wrong. Luckily, most of the issues you need to think about aren't unique to you or your firm. This article pulls together 8 of the most fundamental things you need to consider when you outsource. There's always something else to think about and every outsourcing exercise has unique aspects, but if you understand these eight tips you'll be well on your way to developing a quality outsourcing program! 1. Select Your Targets Start by identifying what you want to outsource and create a simple outline to pull together the details of your outsourcing proposal. Follow these steps and you will be able to develop your ideas, better understand the opportunities and present the the most appropriate programs for outsourcing to senior management. If you build a strong foundation of agreement early on, you greatly increase your chances of success. 2. Distance vs. Complexity While every outsourcing exercise is unique, it's generally true the farther away you outsource, the greater the complexity of the project. In the past few years, many outsourcing projects have either not understood or ignored the additional effort, time and commitment needed to obtain the financial benefits of offshore. This article provides you with a quick primer on distance vs. risk. 3. Conditions to Consider Regardless of which geography you choose, there are basic conditions to consider. Cost is affected by location, but also by provider, and by contract conditions. Your contract may have clauses about the availability of your service, such as "we guarantee 99.9% up-time," but if your outsourced facility is near a river, by the ocean, in an area affected by hurricanes or ice storms... then you just might want to temper those guarantees with a bit of research and discussion about EXACTLY their disaster plan works. This article will help you to develop your checklist for vendors. 4. Consider compensation issues Compensation is a key determinant of your total cost. However, there's a lot more to it than just, "Pay is less in India than in New York." Higher offshore inflation, and changes in foreign exchange rates can cause unexpected surprises when your contract expires. Onshore contracts are dominated by compensation costs. Offshore contracts more strongly influenced by other costs (space, power, software licensing, etc.). 5. Improve As You Outosurce When you outsource, you shouldn't just take your existing operation and move it somewhere else. This is your opportunity to take a good look at how your operations work and identify what needs to be improved. Many outsourcing projects fail, often due to La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 25

www.efficaciapersonale.com unresolved problems that existed before outsourcing began. By developing an improvement program for each outsourcing effort, you manage your risk and improve your chances of success. 6. Know Your Own Values Your contract contains the details of how your program is managed, but the contract is only one form of communication between you and your vendor. Meetings, calls and emails over the life of a contract powerfully influence the operation of the program. Constant discussion about lowering costs, hiring more quickly, or otherwise "pushing the envelope" on the contract can lead to unexpected shortfalls elsewhere in your program. 7. Communicate with your Outsourcer "Total outsourcing" programs... ones that hand work over to vendors and then largely forget about them... have very high rates of failure. You need to set up lasting and meaningful lines of communication between your organization and the vendor. These tips will help you set up your channels of communication. 8. Prepare for Your Next Contract The first year of your outsourcing program is usually more of a pilot than a true program, and much of the remaining year or two of your first contract is needed to fix program issues and build your team to full strength. Before you know it, the time has arrived to renew your contract. Have you been planning for the new contract? Here are some items to consider... La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 26

www.efficaciapersonale.com James Bucki http://operationstech.about.com/od/officestaffingandmanagem/a/OutSrcAdvantg.htm

Top 7 Outsourcing Advantages

Outsourcing Advantages: A Back-Office Operations Illustration


As you evaluate your choices and decisions in outsourcing different components of your operations, you will need to consider the advantages of outsourcing. When done for the right reasons, outsourcing will actually help your company grow and save money. There are other advantages of outsourcing that go beyond money. Here are the top seven advantages of outsourcing. 1. Focus On Core Activities In rapid growth periods, the back-office operations of a company will expand also. This expansion may start to consume resources (human and financial) at the expense of the core activities that have made your company successful. Outsourcing those activities will allow refocusing on those business activities that are important without sacrificing quality or service in the back-office. Example: A company lands a large contract that will significantly increase the volume of purchasing in a very short period of time; Outsource purchasing. 2. Cost And Efficiency Savings Back-office functions that are complicated in nature, but the size of your company is preventing you from performing it at a consistent and reasonable cost, is another advantage of outsourcing. Example: A small doctor's office that wants to accept a variety of insurance plans. One parttime person could not keep up with all the different providers and rules. Outsource to a firm specializing in medical billing. 3. Reduced Overhead Overhead costs of performing a particular back-office function are extremely high. Consider outsourcing those functions which can be moved easily.

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www.efficaciapersonale.com Example: Growth has resulted in an increased need for office space. The current location is very expensive and there is no room to expand. Outsource some simple operations in order to reduce the need for office space. For example, outbound telemarketing or data entry.

4. Operational Control Operations whose costs are running out of control must be considered for outsourcing. Departments that may have evolved over time into uncontrolled and poorly managed areas are prime motivators for outsourcing. In addition, an outsourcing company can bring better management skills to your company than what would otherwise be available. Example: An information technology department that has too many projects, not enough people and a budget that far exceeds their contribution to the organization. A contracted outsourcing agreement will force management to prioritize their requests and bring control back to that area. 5. Staffing Flexibility Outsourcing will allow operations that have seasonal or cyclical demands to bring in additional resources when you need them and release them when you're done. Example: An accounting department that is short-handed during tax season and auditing periods. Outsourcing these functions can provide the additional resources for a fixed period of time at a consistent cost. 6. Continuity & Risk Management Periods of high employee turnover will add uncertainty and inconsistency to the operations. Outsourcing will provided a level of continuity to the company while reducing the risk that a substandard level of operation would bring to the company. Example: The human resource manager is on an extended medical leave and the two administrative assistants leave for new jobs in a very short period of time. Outsourcing the human resource function would reduce the risk and allow the company to keep operating. 7. Develop Internal Staff A large project needs to be undertaken that requires skills that your staff does not possess. On-site outsourcing of the project will bring people with the skills you need into your company. Your people can work alongside of them to acquire the new skill set. Example: A company needs to embark on a replacement/upgrade project on a variety of custom built equipment. Your engineers do not have the skills required to design new and upgraded equipment. Outsourcing this project and requiring the outsourced engineers to work on-site will allow your engineers to acquire a new skill set. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 28 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com James Bucki http://operationstech.about.com/od/vendorselection/a/VendorSelectionHub.htm

The Successful Vendor Selection Process

The Five Step Vendor Selection Process


The vendor selection process can be a very complicated and emotional undertaking if you don't know how to approach it from the very start. Here are five steps to help you select the right vendor for your business. This guide will show you how to analyze your business requirements, search for prospective vendors, lead the team in selecting the winning vendor and provide you with insight on contract negotiations and avoiding negotiation mistakes. 1. Analyze the Business Requirements Before you begin to gather data or perform interviews, assemble a team of people who have a vested interest in this particular vendor selection process. The first task that the vendor selection team needs accomplish is to define, in writing, the product, material or service that you are searching for a vendor. Next define the technical and business requirements. Also, define the vendor requirements. Finally, publish your document to the areas relevant to this vendor selection process and seek their input. Have the team analyze the comments and create a final document. In summary: 1. 2. 3. 4. 5. Assemble an Evaluation Team Define the Product, Material or Service Define the Technical and Business Requirements Define the Vendor Requirements Publish a Requirements Document for Approval

2. Vendor Search Now that you have agreement on the business and vendor requirements, the team now must start to search for possible vendors that will be able to deliver the material, product or service. The larger the scope of the vendor selection process the more vendors you should put on the table. Of course, not all vendors will meet your minimum requirements and the team will have to decide which vendors you will seek more information from. Next write a Request for Information (RFI) and send it to the selected vendors. Finally, evaluate their responses and select a small number of vendors that will make the "Short List" and move on to the next round. In summary: 1. Compile a List of Possible Vendors La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

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www.efficaciapersonale.com 2. Select Vendors to Request More Information From 3. Write a Request for Information (RFI) 4. Evaluate Responses and Create a "Short List" of Vendors

3. Request for Proposal (RFP) and Request for Quotation (RFQ) The business requirements are defined and you have a short list of vendors that you want to evaluate. It is now time to write a Request for Proposal or Request for Quotation. Which ever format you decide, your RFP or RFQ should contain the following sections: 1. Submission Details 2. Introduction and Executive Summary 3. Business Overview & Background 4. Detailed Specifications 5. Assumptions & Constraints 6. Terms and Conditions 7. Selection Criteria 4. Proposal Evaluation and Vendor Selection The main objective of this phase is to minimize human emotion and political positioning in order to arrive at a decision that is in the best interest of the company. Be thorough in your investigation, seek input from all stakeholders and use the following methodology to lead the team to a unified vendor selection decision: 1. 2. 3. 4. 5. 6. Preliminary Review of All Vendor Proposals Record Business Requirements and Vendor Requirements Assign Importance Value for Each Requirement Assign a Performance Value for Each Requirement Calculate a Total Performance Score Select a the Winning Vendor

5. Contract Negotiation Strategies The final stage in the vendor selection process is developing a contract negotiation strategy. Remember, you want to "partner" with your vendor and not "take them to the cleaners." Review your objectives for your contract negotiation and plan for the negotiations be covering the following items: 1. 2. 3. 4. 5. 6. 7. List Rank Your Priorities Along With Alternatives Know the Difference Between What You Need and What You Want Know Your Bottom Line So You Know When to Walk Away Define Any Time Constraints and Benchmarks Assess Potential Liabilities and Risks Confidentiality, non-compete, dispute resolution, changes in requirements Do the Same for Your Vendor (i.e. Walk a Mile in Their Shoes)

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6. Contract Negotiation Mistakes The smallest mistake can kill an otherwise productive contract negotiation process. Avoid these ten contract negotiation mistakes and avoid jeopardizing an otherwise productive contract negotiation process. Chris Niccolls http://outsourcing.about.com/od/contracts/a/Improve-Outsourcing-With-Onshore-Projects.htm

Improve Outsourcing With Onshore Projects!


When the worlds financial markets collapsed a few years ago, a giant wave of outsourcing swept through corporate America and moved knowledge-based jobs offshore. Years before, electronics manufacturing moved to Asia and less sophisticated manufacturing moved to low cost locations around the world. We've been working in a world of offshoring long enough to know that it just doesn't make sense anymore to build electronics and certain other goods in America any more. Once you've moved these things offshore, they can never come back again. Or can they? A few years ago, analyst would have said it was impossible for high-technology products likeGoogles tablet computer or industrial equipment from Caterpillar to return to America. Yet, both firms have committed to doing just that. At the same time, General Electric has made a billion-dollar commitment to bringing jobs back to America. Service jobs are also returning to America. Rather than being surprised, we should be expecting this, and much more, to be part of the wave of returning jobs. When you outsource, whether it is on or offshore, you decide based on the conditions of the day. Your needs, and those economic conditions, change over time. A typical outsourcing contract is three to five years. Add to that the 1-3 years that it took to think about outsourcing, develop an RFP, select a vendor and sign a contract. When your outsourcing contract is over, the world is three to eight years later. Consider how different 2012 is from 2004. And you will have learned new facts from your outsourcing experience. Some things will have gone just as you expected, and some will not. In the one and only vice-presidential debate of 2012, there was a stand-off between Biden and Ryan on alternative energy investments. Ryan said that four alternative energy programs failed, and that this was unacceptable. Biden countered that this was only 4 out of many investments, and that investment banks have a success rate of just 60%. Everyone can debate what is the right level of success for any portfolio of investments, but Biden did make a very good point. No one, no government or private firm, has ever run a large portfolio of projects where every project succeeds. There can be huge differences in how well two different portfolios operate, depending on how they are managed. However, every portfolio has failures. The same is true about Americas portfolio of offshoring. Each of these investments by corporate America had different motivations, and different level of outsourcing knowledge. Just as an investment professional can look through a financial portfolio and identify risks and make recommendations for improvements, the same can be done with your outsourcing portfolio. Consider the following factors for your portfolio: La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 31

www.efficaciapersonale.com GOALS: What were you trying to accomplish by outsourcing? You may have outsourced just a portion of business functions, and now you have comparative information between on and offshore. And your environment may have change significantly, requiring a different set of goals and a different operation to be successful. METHODOLOGY: In the last few years, a lot of outsourcing was based on a need for rapid cost reduction, using total outsourcing to send entire business functions to a vendor. Not surprisingly, a lot of these projects didn't work as expected. McKinsey Consulting, the largest consulting firm in the world, tells us that only about 50% of outsourcing projects work. Total outsourcing in the IT world may have a success rate as low as 10%. Your choice of methods, not just locations, matter. TIME-FRAME: What sort of a time-frame are you working with? Are you just concerned with your operation next year? Or is the plan for the next 3 years, or even 10 years? An outsourcing plan that is heavily weighted towards offshore may make sense for one or two years, but by year three or later this same plan may not deliver the same value to your operation. That value will rise or fall, depending on the time-frame you choose. PROGRAM DATA: When you compare locations, what is the source of your data? We always need to start with historical data, but the data has changed dramatically in recent years, especially cost data. Make sure that your data is recent, and from a reliable source, and be ready to update it as your project progresses. TRENDS: Dont stop at current or historical data. You need to be able to project where you will be at the end of the contract, or sooner (especially if your contract has inflation or foreign exchange clauses). If your time-frame is more than that of the current contract, you also need to know if the project will continue to make sense when its time to renew the contract. RISKS: With years of outsourcing experience, we now know the sort of risks to look for. Financial risks can come out of inflation, which is much higher offshore than in the US or Europe. The cost of space in typical US outsourcing location is far less than in most India, China, and other offshore locations. Now that locations in India and China have been outsourcing for years, the expectations of the labor markets have risen faster than wages. That doesn't merely raise costs, it makes production uncertain. For physical goods, you need to consider more than just the conditions in your work location, you need to understand the risks of the entire supply line back to your home market. Unfortunately, for some outsourcing firms that means dealing with warlord and pirates. Most of these risks are unknown to firms that are just becoming familiar with global outsourcing. RATINGS: Once you have all of this information, how are you using it to use it to choose your location? Presented with the same information, different firms make different decisions. You need to dispassionately determine the factors that matter most to you (cost, control, time to start the program, level of risk, ability to scale, sustainability, etc.) Be realistic about how you value each factor. Some firms made the ability of the location or the vendor to service the firm globally a minimum requirement, but in the end only used that location to service one office for the firm. Dont rate based on theories, rate based on your real needs.

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www.efficaciapersonale.com When you objectively look at the value of each location, there are still plenty of reasons to offshore, but there are also a growing number of projects that can be outsourced closer to home. Moving work back onshore is one of the biggest, and fastest growing, trends in outsourcing. If you give a little thought to what your goals are and have access to up-todate data, you too may become part of the wave of outsourcing to America! Chris Niccolls http://outsourcing.about.com/od/feasibility/a/Five-Factors-For-Choosing-An-Outsourcing- Location.htm

Four Factors For Choosing An Outsourcing Location


When you begin to think about an outsourcing plan, developing your process for how someone else will do work that you used to perform, you need to consider WHERE you will do your outsourcing. Recently, there has been a wave of onshoring, moving work that was sent offshore to India, China and other locations, and moving it back inside the client corporation or at least moving to a vendor that is in the same country (if not the same city) as the client. Every firm has different reasons for choosing a specific location, but the fact that most outsourcing fails indicates that the way that firms choose is often flawed. One of the big problems is that when we outsource we often start at the wrong end of the problem. All too many outsourcing projects begin by saying, I need to save money. Where is the cheapest place to send my work, so that I can make the greatest savings?" By making lowest cost the most important factor in the decision-making process, many projects become far riskier than necessary. Add to this the fact that the overwhelming number of outsourcing projects that have been performed in the last few years have been total outsourcing. That is to say, that an entire department or function is moved from the client to the outsourcer, usually in one step. Instead of looking at the cost of the location, the very first question you should ask yourself is, What is the capability of the location? A location that has a lot of capability to do your work is, of course, a better location for you to select. When you speak to many managers, they often begin their journey in outsourcing with the assumption that whatever they do, even if it is a common function, their specific process for doing it is unique. In fact, it may be so unique that no other place in the world may be able to do it exactly the same way. By outsourcing the process the magic of your process may be lost. While this does not need to be the case, it is certainly the result that has been reported from failed outsourcing. You had a process that worked one way, and after the outsourcing process, it doesn't work that way, and has degraded. To play the devils advocate, there is only one place in the world where there is a 100% certainty that your work can be done the way that it is now, and that place is exactly where you are now. Every day, the service that you are running runs the same way. More or less. Lets say you run a corporate library. If we were to look at just a single week of your operation, there would be differences from day to day, because the volume of work sent to your library could vary, key librarians could be out sick, data services could have technical outages.

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www.efficaciapersonale.com Still, even with these variations your service is familiar to you; you know how it works, and your staff knows what is expected of them. There is a great deal of tacit knowledge, unwritten rules of how things work, such as the preferences of key customers (never emails me, always call to tell me what data you have, etc.). It takes an organization many years to know these small details, and tacit knowledge is often lost during outsourcing. For this reason, the plan for a complex outsourcing project is sometimes to just hand over the existing staff to an outsourcer, with the outsourcing management sitting inside of the clients space. By keeping the staff and only changing he management, you do the most to retain your capability to do the work. Of course, by keeping the same staff in the same location, there will be little direct and obvious improvement in cost and productivity. Years ago, it was common to outsource copy centers this way. A big corporation would own its copy center, realize that this was not a core competency and outsourced it to Xerox, Pitney Bowes, Williams Lea or a similar vendor. The advantage to outsourcing was not just freeing up your managers and solving a few complaints, it was that the vendor owned a huge fleet of copy machines, reducing several critical cost factors (equipment, toner and paper). Most of the work that is outsourced today aren't as dependent on equipment costs. For knowledge based outsourcing today, what are the critical location variables? CAPABILITY: If you cant leave the work in your office, you can probably do the work next door, down the block or near your office. Services like legal, banking, and accounting tend to be near other firms of the same sort. Cities with a lot of lawyers also tend to have law schools. The combination of firms and education give you capability. If youre outsourcing it would also help if its not a very hot labor market, and there are available workers of the type you need. This combination of factors is probably why your firm is located where it is. While locating your outsourced service in the same city say New York or London may make for only the most minimal of changes, there may be other locations that are less expensive but have schools and other firms like yours. Chicago might work, but it has a similar cost structure. So, look at still smaller cities like Atlanta, or Albany. If you are from one of the biggest cities, then you have a lot of options looking at slightly smaller, slightly better priced locations. But when you are in a mid-sized or smaller city, you must look at still smaller locations if you dont want to raise costs. POTENTIAL: If you cant find a suitable location that has similar capabilities, then you need to find a location with the potential to perform your work. For example, there might be a location that has schools that train for the work you do, has a lot of businesses performing that function and has whatever other qualities you want. However, they may not speak your language. You might find librarians (or lawyer, or accountants) in Spain or Hungary. It may be simple to improve English language skills, or you may find that there are other differences in training and culture that make it more difficult (and more expensive) to transfer work to this location. By choosing potential over capability, you increase risk and increase the time to complete the project. The higher risk may be worth it if the location has sufficiently lower costs and other success factors. However, if your location has more potential than capability, a rapid total outsourcing project is a very bad idea. Developing capabilities takes time, and requires La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 34

www.efficaciapersonale.com a variety of formal and information knowledge transfers. If the plan is to move an entire group, at one time, in one phase, you need a site that is fully able to work on day one. It could work with just potential, but it a very risky bet. RISK: Every location is different. Flooding, storms, political instability, unstable electrical power, poor worker transportation the list can be very long. And it differs for every firm. If you plan to ensure that managers visit the outsourcing site frequently (which is always a good idea) you may want to add the number of fight changes to get there. If you want to offshore your program, you need to consider changes in the rate of exchange between the local currency and your currency, which can dramatically (and unexpectedly) change the cost of your services when you renew your contract. Great domestic outsourcing sites, such as Fargo North Dakota, have the unusual risk of low unemployment, increasing recruiting costs; as the worlds economy improves, this may affect more and more outsourcing sites. Identifying and putting a value to all of these risk should be a major part of your outsourcing program... COST: Now that you have looked at all the other factors, you can look at cost. Knowing that the cost of one location is half that of another location is important, but incomplete information. It is far better to know that the lower-cost location has limited English language skills and has potential to do the work, but has never done this specific type of work before. You can go a step further by giving each of these factors a numeric value. For example, you can give a value of 1.00 for a vendor that performs nearly identical work, .75 for similar work, and .5 for related work that requires considerable training. For an offshore location, you can look at the history of currency rates and inflation, and give it a value. Multiply all the values and you will see dramatic differences in risk levels vs. cost levels. You can also look at risks as the potential time it takes to get everything right before you are ready to go into full production. If it takes only six months to get into production in a more expensive location vs. three years in a cheap location, the real cost of production is very different than the amount you are charged per hour. All of these factors are valued differently by every client firm. There is no one perfect location for everyone. However, if you identify and rate each of these factors, you can develop a logical way to compare each site, and estimate how successful each approach could be. If a firm wants to be innovative and gain a much higher return on their outsourcing dollars, choosing a higher-risk option may be the right way to go but it will also mean that the client must put in more effort to ensure that at every risk point you receive the positive risk (a benefit) rather than the negative risk (a cost). Make the right choices about the location, and you can build the successful outsourcing program you need! La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 35

www.efficaciapersonale.com Chris Niccolls http://outsourcing.about.com/od/clouds/a/how_to_develop_a_plan_for_outsourcing.htm

How to Develop a Plan for Outsourcing


A lot of discussions about outsourcing in the media make it appear complex, but it's really quite simple. At home, we've "outsourced" many functions: Cooking, maintaining our lawns, child care, and much more. When we haven't got the time, the focus, or the skills to do the work ourselves, we look for someone who can do the work who we can afford to pay. Corporations work the same way, even though their decisions may involve more factors and decision-makers. But just as families make different decisions, corporations can come to startlingly different decisions about outsourcing. There is no template that works for all firms, but there is a process that all firms need to go through: Realization: Yesterday, big corporations didn't know what outsourcing was. Today, they know about outsourcing, but don't realize how many outsourcing (and outsourcing-like) programs they already operate: Copy centers, mail rooms, facility management, IT, even parts of the legal department. Outsourcing may not solve every problem, but learning about the previous generation of contracts will identify new projects and provide valuable insight. Goal setting: Corporations perform a lot of different work functions. To be successful in creating an outsourcing program, you need to define specific goals, like reduce corporate costs by 5%, focus just on your New York office, or only look at functions performed in one business unit. Goals don't need tremendous detail. As your outsourcing experience increases, definitions will change. Participation: You need participants from many areas of expertise to provide inputs to the plan, to verify assumptions and to provide expert judgment. When you move from a general plan to specific projects, you will repeat this process and create sub-groups with even more specific knowledge. Identification: Now that you have goals and experts to identify and interpret information, it's time to identify specific projects for your outsourcing program. Every firm develops different criteria, and is driven by culture as much as by financial or operational analysis, but there are common criteria that you should look at: Previous decisions: Your firm probably made earlier decisions about using nonemployees, such as temporary workers or service contracts. Work with Procurement and your PMO (Project Management Office) for details. See how they addressed the issues on this list, and compile lessons learned. Expertise: Are you performing functions or producing products without sufficient expertise, or are you having problems retaining managers? Does the current La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 36 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com management have a plan to address these problems? If not, this could be a good outsourcing project. Quality: Even if a function has the people with the right skills and experienced managers, you may not get the level of service you need. Does the manager conduct customer surveys? What are the customers saying? A gap in quality or a lack of interest in customer service is another flag for outsourcing. Cost: An exceptionally high-quality service is not necessarily a good value. How do your costs compare to competitors? Does the function produce monthly reports: Unit costs, operating cost, multi-year cost trends? If this function cannot produce thesereports, an outsourced service might provide greater transparency into your operations. Scale: When you examine your entire firm, you will make many unexpected discoveries. Stay focused! One big project is a better candidate than number of smaller projects. That single big project will require far fewer administrative and management resources. Keep a comprehensive list, but only select candidates than provide a big impact in your first wave of projects. Security: You now have a good idea of potential projects. It's time to filter them according to security standards. Security is a complex and controversial subject. Different standards apply to different industries, and some firms are more security conscious than their competitors. Understand internal and industry standards, and limit outsourcing projects accordingly. Include legal, IT, corporate security, and compliance (if it applies), and any "risk" departments in your discussions. Prioritization: Each item above (and perhaps other characteristics) must be scored, and then each project given a total "outsourcing value." Undoubtedly, there will be much debate over which characteristics are the most important, if their scores are accurate, and if other characteristics should be considered. Don't be surprised if this process lasts for months or even years. Communication: By the time you've prioritized potential projects, you've held a lot of meetings and talked to a lot of people. Expect these discussions to be public information in the departments you've targeted for outsourcing. Always assume that these discussions will get to your employee population, often in real time. Carefully thought out corporate communications need to be prepared and ready. Never let rumors become a better source of information than facts.

At the end of this process you will have your initial outsourcing plan. There are many more steps as you execute this plan: Confirming data, sub-committees for specific projects, identifying vendors , running pilots, awarding contracts, and so forth. However, developing your plan provides you with the first and most important step!

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Chris Niccolls http://outsourcing.about.com/od/feasibility/a/Total-Outsourcing-Totally-Misses-The-Point.htm

Total Outsourcing Totally Misses the Point!


There are many different business processes that you can outsource, and nearly as many different ways to do your outsourcing. In the past few years, the most common theme for outsourcing has been something called, Total Outsourcing. What sets this apart from other forms of outsourcing is that the objective is to take an entire department or business function and move it to a vendor. The feature that separates total outsourcing from other forms of outsourcing is it almost always fails! If Total outsourcing is such a total failure, why do people continue to do it? Total outsourcing can make sense, but only in limited circumstances. For example, it does make sense to do total outsourcing if you need to shut down an old location; perhaps the cost of electricity has risen dramatically and irreversibly; the location is no longer physically safe due to changing weather patterns; or the type of skills you need are no longer easily available in that location. If you are a manufacturer, perhaps you use unique and expensive equipment. Everything in your process (people, equipment, manufacturing space, supplies) needs to be in the same location to be effective; splitting up the work processes is not an option. However, while a total outsourcing approach may be required for manufacturing, few knowledge based outsourcing projects(BPO, KPO and LPO) fit this description or benefit from total outsourcing. The alternative to total outsourcing is to perform outsourcing in stages, usually starting with the easiest to outsource functions and then slowly expanding the program based on the tangible results rather than unfounded expectations. The ultimate goal of a staged outsourcing program may be to outsource 100% of a function, but not as the day one model. A staged outsourcing project, that involves a complex or uncommon business process, may take years to complete. If you take a look at any outsourcing program, you will see that within a department or business function, there are often multiple individual functions. As an example, lets look at a document center to understand these functions and their suitability for outsourcing: INTAKE: Some method is used to transmit work from the customers to the document center. Customers may just walk to the center and drop off work, or the customers and the center may be in different locations, and most work may be transmitted by email with additional information sent by phone. The more physical the process, the greater the difficulty in moving it (away from the customers). If you want a high level of customer satisfaction when you outsource, changing the way that a customer interacts with that service, while you are re-building that service is both a high-risk strategy, and a low customer service concept. Changing the intake process might be a good idea (especially if there are complaints about how the function works) but changing the interaction with the La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 38

www.efficaciapersonale.com customers just to make the rest of the plan work, places the customer last in thinking, which is rarely the quickest part to success! SCHEDULING: A document center is often a multiple shift or 24 x 7 operation. There is a need to schedule staff, schedule deadlines, assign work, re-schedule problematic work, maintain a reasonable queue, etc. Scheduling is one of the primary forms of management, and often includes vast amounts of tacit knowledge. Which worker is faster or more accurate, or happens to speak French, or is a specialist in Excel, which clients consistently ask for one thing but really want something else, who are the movers and shakers in your organization that automatically move to the top of the queue, how do you re-stack the queue after a significant event (for example, a technical outage of more than a few minutes), and which workers are likely to be late (or not show up at all) if there is heavy snow? While many outsourcing firms are very competent in documenting the work processes for multiple Word or PowerPoint templates, few have experience in understanding how tacit knowledge about customers and the larger corporate environment impacts the delivery of a service. When the workers change the scheduling process needs time to catch up. As a result, scheduling should be one of the last functions to move to the outsourcer. TYPING: Direct editing of words is the easiest (and earliest) functions to outsource. A document has one word crossed out and another word written in. Very simple. However, if the edits are in legal documents with complex changes using obscure legal words, and the edits are in bad handwriting its harder. However, its still easier to do than other functions. However, it should be noted that in most major metropolitan areas in the US and the UK, you can find a lot of people who can type at 50 or 60 words per minute (WPM), and even individuals who can type 90WPM. These high speed typing skills are largely a result of concentrated secretaries, transcriptionists, legal secretaries and similar positions in these geographies. Offshore these high speed typists do not exist. Its just an accident of history. If you look at India, the young workers in outsourcing firms just havent worked long enough doing extensive typing to develop the necessary speed. Higher-speed typists might reach 30 to 40 WPM. FORMATTING: Formatting is another good area for early stage outsourcing. It is usually possible to find many workers, in many different popular outsourcing locations that are capable of performing this work. The complications can be special add-in tools that require additional training or very extensive (and not particularly well documented) formatting rules. Of course, there are usually opportunities to make better use of templates and automation that can simplify this function. GRAPHICS: Some document centers, such as legal centers focused on contracts, create and edit very few graphics. Other document centers, such as a presentation center in an Investment Bank, have extensive graphics requirements. They may use the features in PowerPoint, but they probably augment this with specialty tools such as: Acrobat Outliner,MapInfo, Visio, Photoshop and many others. Large numbers of these workers can be found in large corporations, advertising firms, the publishing industry and graphic firms which tend to be in large cities. But that also includes large offshore cities such as Mumbai and Beijing. If your outsourcing site is not near a large city, these individuals may need to be developed rather than hired. Depending on the sophistication of your work, it can take years to develop these skills.

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www.efficaciapersonale.com PROOFREADING: In a highly process driven document center, the role of the proofreader is very basic, merely comparing the completed work with the written instructions. In a less formal editing environment, the proofreader may be considerably more senior and may play a quality control role, perhaps suggesting changes to an ambiguous edit. In many corporations, there are special versions of words and phrases that would not be considered correct English. Knowing when to override correct English and the spell checker requires more experience and more confidence. DELIVERY: How does the work get back to the customer? Do you email the document? Or do you print a copy and hand it to your customer? Or if the customer agrees that it is correct, does the customer take it to the copy center to make extra copies or do you perform this service for them? If the copy center physically resides next to the Presentation Center, it will be difficult to substitute a service that is located in another city. At least not on day one. CUSTOMER SERVICE: It is not unusual in total outsourcing to move everything, including the customer service, to the vendor location. However, if you have in-person interaction today, it is very difficult to take this away from customers without losing some goodwill. There are other ways to perform customer service, some of which may even be superior, but different options will work better in different environments. You will create a far better solution if you experiment, listen to your customer and evolve a better solution. If not, your outsourced solution may fail because of bad customer interaction, even if the service is in every way an improvement. MANAGEMENT: Perhaps one of the biggest mistakes in total outsourcing is that all managers are removed, and replaced with one worker remaining with the client to manage the relationship with the vendor. This individual is often one of the previous managers of the service, and is made in a contract manager rather than a service manager. The job of this manager is to run the service according to the provisions of the contract, rather than to improve the service or create innovations. In fact, most contracts of this sort prevent innovation through a series of penalties, without providing many (if any) rewards for innovation. Looking at the typical total outsourcing contract, you will find sections on fees, security and penalties, but you will almost never find a section on innovation and improvement. As a result, when it is time to renew the contract, no inefficiencies have been found, and the cost will be flat or rising (due to currency exchange rates and/or inflation). Unless the management of your operations has been identified as a reason for low performance, you should slowly reduce in-house management, until you have determined if sufficient operational knowledge resides with the vendor. When you decide how you will develop your outsourcing program, remember that total outsourcing can be used to develop a successful program, but also remember that the solution needs to match the needs of the program. If the program requires a staged, gradual process, and instead you limit yourself to a single-stage total outsourcing approach, you also limit your chance of success. Give careful consideration of the needs of your program, and choose the process that fits best, and you give your program the best chance if success!

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Marty Pine http://outsourcing.about.com/od/avoid/a/Voiding-Heading.htm

Avoiding the Dark Side of Help Desk Outsourcing


The competition in today's economy is fiercer than ever and IT organizations globally are searching for strategic methods to drive out cost, time and effort. Many organizations are becoming laser focused on their core business and the activities that are required to make them successful in the current competitive landscape. With many organizations cutting staff, there are less and less resources available to support the corporate strategic initiatives. It is well known that outsourcing non-essential business processes and operations has become a significant trend over the last several years. In fact Bruce Caldwell, a principle analyst with Gartner, believes that companies can generate upwards of 20-30% cost savings on internal operations through outsourcing. This can represent a substantial savings to an organization which cannot be easily ignored. Outsourcing your help desk can appear to be an easy answer for reducing cost and improving service levels, however, there can be a dark side to outsourcing. There are significant challenges to finding the right vendor, ensuring a smooth transition and understanding the expectations and true costs. So how do you make sure you will gain the benefits of outsourcing and avoid the pitfalls? We have done the research and drawn from our own experience to bring you

The 11 biggest mistakes companies make when choosing an outsourcing provider and how to avoid them:
1. Not understanding your business and its core competency Whether your organization is in health care, manufacturing, finance or sales - all businesses have components that are core to the business. These components go far beyond customer satisfaction, such as having email capabilities or internet access. For example, the primary focus of health care is overall patient health and well being. Data records are vital to patient health and confidentiality. Having them available and protected for care is essential to the organization, whether those records are electronic or paper. Data Protection and Recovery in health care is a core component to the business and essential for the IT organization to maintain thus can and never should be outsourced. Knowing what's core to the business will also identify areas that are not critical, such as desktop management or hardware repair. Understanding the vital business components that IT must not only support but be key stakeholders in will allow the IT group to shift resources to the areas that allow IT to be a strategic asset rather than a cost center. 2. Not taking the opportunity of looking at outsourcers to get an expert assessment of your current situation in order to properly diagnose your needs La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 41

www.efficaciapersonale.com and propose a customized solution. Any vendor can provide services that are within their own core competency, but each organization is unique with specific challenges. A vendor relationship must be managed from all parties involved, and each side must have a vested interest in a successful implementation. Instead of locking into a particular workflow or methodology, a vendor should focus a great deal of time and effort into the transition methodology prior to taking the "first call". Transitions can take anywhere from 30 days to 6 months, depending on the complexity of the organization. Getting a smooth transition from initial discovery to a steady state is perhaps the most important component to a successful implementation. 3. Not choosing a provider with a strong, well-defined IT service delivery model including complementary services available in case additional outsourcing is desired/ needed at a later point. This is related to choosing based on price. Chances are the low cost providers are also low on the experience/ service delivery sophistication spectrum. Your long term success will depend on choosing a reputable, expert partner with both depth and breadth of experience with many different clients and a proven service delivery model that works across all situations. 4. Locking your company into a multi-year contract with large termination fees. More than one company has entered into an agreement with an outsourcing provider only to discover later that they were stuck paying outrageous prices for subpar services and there was nothing they could do short of forking over exorbitant fees in order to terminate the contract. Make sure you negotiate an out-clause that won't hurt your bottom line. 5. Not implementing continuous improvement processes like Root Cause Analysis.According to a recent article in CIO Magazine, "The most current outsourcing deals and models are outdated and ineffective because they are people-based and not demand-based. Companies have a need for resources to do the work that is required; they negotiate a rate with a vendor and determine contract durations.

The contracts primarily follow a simple model: People x Rates x Duration.


It is easy to understand why a people-based model is being used today, since outsourcing grew out of the Y2K era. Companies first engaged outsourcing companies in staff augmentation models to address their Y2K needs, and hence, all subsequent outsourcing models have been people-based. While outsourcing companies have grown in leaps-and bounds over the past three to five years in terms of their capabilities, there has been little evolution in deal structures. People-based outsourcing contracts are the equivalent of paying rent. The rent is due each month regardless of use. In a 'rental agreement' there is no mechanism or incentive to drive productivity improvements, efficiencies, higher-value-add services, faster time-to-market, and deeper cost cutting efforts."Continuous improvement programs throughout the life of a service agreement will ensure that a vendor is staying relevant to the IT organization, and that the IT organization itself is staying relevant to the business. Demand-based contracts and models are revolutionary and will drive unbelievable results if properly implemented, executed, and governed. IT organizations will become better-aligned with their business partners and CIOs will have much more flexibility in how they allocate and spend their funding. 6. Choosing based on price as the determining factor. This would seem obvious, but in today's business climate price has taken on a more predominant role in many company's La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 42

www.efficaciapersonale.com decision-making process. That might be alright if you are comparing PC's or mice, but outsourcing is such a multifaceted service and needs to be a partnership between companies. The lowest price should be seen as a red flag - often the lowest price company either doesn't understand the full extent of work required, doesn't plan on providing good service, or plans to make up for the lost revenue via extra charges. If it seems too good to be true, it probably is. In some cases, the most expensive provider might also be the best value and could actually save your company money overall via lowering your overall IT operating expenses (e.g. using root cause analysis to find and fix the actual problems rather than constantly applying band aids). Buy quality - cry once. Buy cheap - cry again and again. 7. Paying on a per-ticket or per-incident basis. This seemingly innocuous choice automatically creates a conflict of interest between you and your outsourcer. They have absolutely no incentive to do any kind of root cause analysis or any other proactive steps to lower your ticket/ incident count. In fact, this arrangement is great incentive to turn one call/ incident into as many tickets as possible. Choose to go with a provider that bills this way at your own peril. 8. Falling in love with any one particular "shore". The right solution for you might be onshore support, offshore support, or a combination. Don't close your mind to any of these options. Today's business environment might cause you to lean towards one option, but who knows what kind of issues you'll be facing tomorrow? It is increasingly important to partner with a company that can seamlessly provide both options and dynamically adjust the ratios if your business requires it. 9. Allowing the outsourcer to define SLA's by themselves. Again, this sounds obvious, but it is common for companies to defer to the outsourcer's boilerplate SLA offering without customizing it to their own individual needs. If the outsourcer isn't flexible enough to customize their offering according to your needs, what else will they be inflexible about? Make sure you are actively involved in setting your own SLA's, customized to the needs of your business. 10. Not developing a Single Point of Contact service model. The concept of a Single Point of Contact (SPOC) service model has been around for some time, but few organizations do it. The idea is that events are handled at the lowest level possible, and that all information is funneled into a centralized location. This allows for two things; continuity and reduction in the total cost of ownership (TCO). Having a repeatable, mature process is at the backbone of the ITIL model, and without a centralized administration continuity cannot be achieved. It's a given that a seasoned engineer with 15 years of experience is a more expensive resource than a PC tech with less than 3 years in the IT field. A typical challenge in IT organizations is that the experienced engineer processes proprietary knowledge that has not been transferred to the less expensive employees. Without a centralized location for processes and procedures, actions cannot be tracked, information cannot be transferred and events cannot be handled in a more effective manner. Having a Single Point of Contact service desk allows for information to be tracked, categorized and ultimately documented for repetition, thus lowering the overall TCO. 11. Not understanding the true costs of IT Support. Most IT leaders can quickly determine internal hard dollar costs, such as dollar per hour or price of a PC. What are typically not factored in are soft dollar costs, such as employee loads or the cost of support. Typical load (the cost of benefits for an employee) is around 25% of the wage. A typical La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 43

www.efficaciapersonale.com desktop priced around $800 will require an additional $5,867 in support costs for the life of the PC in an unmanaged environment. According to Gartner, effective management can cut total cost of ownership for desktop PCs by 42%. Understanding the true costs will allow IT leadership to make a more informed decision on whether or not to outsource a particular service. James Bucki http://operationstech.about.com/od/outsourcing/tp/OutSrcDisadv.htm

Top 6 Outsourcing Disadvantages

Outsourcing Disadvantages: Reasons That Outsourcing is Bad for Your Company


As you evaluate your outsourcing choices, keep in mind that there are advantages to outsourcing and disadvantages of outsourcing. Look at each one of the outsourcing disadvantages listed below and decide what impact that item would have on your business. If the outsourcing disadvantages outweigh the advantages of outsourcing, then you should avoid outsourcing those operations. 1. Loss Of Managerial Control Whether you sign a contract to have another company perform the function of an entire department or single task, you are turning the management and control of that function over to another company. True, you will have a contract, but the managerial control will belong to another company. Your outsourcing company will not be driven by the same standards and mission that drives your company. They will be driven to make a profit from the services that they are providing to you and other businesses like yours. 2. Hidden Costs You will sign a contract with the outsourcing company that will cover the details of the service that they will be providing. Any thing not covered in the contract will be the basis for you to pay additional charges. Additionally, you will experience legal fees to retain a lawyer to review the contacts you will sign. Remember, this is the outsourcing company's business. They have done this before and they are the ones that write the contract. Therefore, you will be at a disadvantage when negotiations start. 3. Threat to Security and Confidentiality The life-blood of any business is the information that keeps it running. If you have payroll, medical records or any other confidential information that will be transmitted to the outsourcing company, there is a risk that the confidentiality may be compromised. If the outsourced function involves sharing proprietary company data or knowledge (e.g. product drawings, formulas, etc.), this must be taken into account. Evaluate the outsourcing company carefully to make sure your data is protected and the contract has a penalty clause if an incident occurs.

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www.efficaciapersonale.com 4. Quality Problems The outsourcing company will be motivated by profit. Since the contract will fix the price, the only way for them to increase profit will be to decrease expenses. As long as they meet the conditions of the contract, you will pay. In addition, you will lose the ability to rapidly respond to changes in the business environment. The contract will be very specific and you will pay extra for changes. 5. Tied to the Financial Well-Being of Another Company Since you will be turning over part of the operations of your business to another company, you will now be tied to the financial well-being of that company. It wouldn't be the first time that an outsourcing company could go bankrupt and leave you holding-the-bag. 6. Bad Publicity and Ill-Will The word "outsourcing" brings to mind different things to different people. If you live in a community that has an outsourcing company and they employ your friends and neighbors, outsourcing is good. If your friends and neighbors lost their jobs because they were shipped across the state, across the country or across the world, outsourcing will bring bad publicity. If you outsource part of your operations, morale may suffer in the remaining work force.


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Laura Lake http://marketing.about.com/od/marketingplanandstrategy/a/outsourcemktg.htm

What to Look for When Outsourcing Your Marketing


It's not a secret that many companies that downsize, re-prioritize or expand find outsourcing to be a cost effective decision to fulfill certain corporation functions. Outsourcing has become an essential aspect of business strategies and this included the marketing function. Outsourcing allows a company to put more focus on product development and overall operations. It eliminates the delay the need to hire full-time staff and avoids tasking overworked staff. Many marketing consultants help companies market their products and services without extending their in-house marketing staff. They can often provide the same service as an in-house marketing department, but at half the cost. By outsourcing you gain the following:

Specialized skills and expertise An external perspective and view point

Outsourcing can be intimidating at first, but there are things to look for when choosing a marketing consultant or an outside marketing firm. Here are a few evaluating questions that should assist you in finding a marketing consultant that is right for you.

Area of Expertise Find out what their expertise is in. There are many component to marketing. What do they focus on? Here are common areas of expertise:

Search Engine Marketing and Optimization Branding Positioning Affiliate Marketing Development and Management Marketing Strategy and Plan Development Internet Marketing Strategy and Plan Development Lead Generation Sales and Marketing Campaign Development Marketing Classes, Seminars, and Workshops

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www.efficaciapersonale.com Figure out what areas you need help in and look for consultants with expertise in those areas.

Training/Education What type of training and/or education is important to you. I will tell you that education is important, however experience and hands-on expertise can far out weigh education when it comes down to success in marketing. Ask for case studies, referrals, and experience in the areas that you need assistance in. Certifications/Memberships This will also tell you how active they are in the marketing community as well as if they've been certified in certain areas of marketing. Notable Achievements What are the notable achievements that the marketing consultant has achieved. What work are they most proud of? Client References Never hire a marketing consultant without contacting client referrals. We can get very excited about the sales presentation and the marketing brochures we've been handed when looking for a consultant, but the truth is the proof is in the achieved results. If they could not succeed with other clients, what makes you think they can succeed when it comes to marketing your products and services? Call those references, it only takes a few minutes and it is worth your time. Evaluate the Fees Before signing any agreements make sure you are clear in the fee structure. Is it based on milestone payments, paying everything up front, or are they working on a pay-forperformance structure? Be clear about what you will be charged and how those fees are determined. There are many marketing consultants out there and with the power of the internet they are not hard to find. Make sure you are comfortable with their experience and that you also feel they understand your marketing goals. They should take the time to listen to you about the vision of where you want to go and what you want marketing to achieve for you before they ever present to you a fee structure. If they are in a rush to have you sign the contract without taking the time to understand your business run away fast and find someone else. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 47 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com They should be patient in the courting process to gain your business, if you feel rushed it will only get worse after the agreement is signed.


Susan M. Heathfield http://humanresources.about.com/cs/strategichr/a/outsourcing.htm

Outsourcing: A Strategic Solution

Outsourcing: Why and What


Looking for ways to potentially cut costs and unburden your shrinking Human Resources staff members? Do you have staff working until six and seven at night? Are you going home each day feeling as if you will never catch up? If so, join the crowd - or choose not to join. Outsource instead. "The current economic climate is forcing organizations to explore tactics to remain competitive. Business process outsourcing of certain functions is an increasingly popular way to improve basic services while allowing HR professionals time to play a more strategic role in their organizations." In a recent survey by theSociety for Human Resource Management (SHRM), HR professionals were asked if they outsource any HR functions. Additionally, if they do outsource, they were asked what functions they outsource. HR professionals were asked to select all that apply. "Reason for Outsourcing

26 percent Save money 23 percent Focus on strategy 22 percent Improve compliance 18 percent Improve accuracy 18 percent Lack experience in house 18 percent Take advantage of technological advances 17 percent Offer services we otherwise could not 15 percent Focus on core business 5 percent Other 47 percent Do not outsource[/li[

Functions Outsourced

84 percent - 401 (k) administration 48

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www.efficaciapersonale.com 84 74 73 72 68 57 54 53 49 49 46 44 41 40 32 17 15 14 11 percent percent percent percent percent percent percent percent percent percent percent percent percent percent percent percent percent percent percent Employee assistance/counseling Retirement planning help Pension administration Temporary staffing Background checks Training and management development programs Executive development and coaching Health care benefits administration Employee benefit administration Payroll Risk management Executive staffing Employee relocation HRIS selection, training implementation Recruitment Executive compensation and incentive plans Policy writing Administration of compensation/incentive plans - Wage and salary administration"

Take a look at what other organizations are outsourcing. Outsourcing certain business processes might make sense for you, too. In any case, thinking about it just makes good business sense from a strategic perspective. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

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www.efficaciapersonale.com Chris Niccolls http://outsourcing.about.com/od/governance/a/how_to_communicate_with_your_outsourcer.htm

How to Communicate with Your Outsourcer


When you decide to start a program with an outsourcing provider, you are committing to a relationship. You have to work closely with your new "partner." Like any committed relationship, how well you communicate will determine how happy you are and how long the relationship lasts. In most outsourcing relationships, the vendor wants to talk to you all the time, especially about expanding your current program or buying a new service. Likewise, you will want to talk aboutimproving services and lowering costs. While you and your vendor have different needs, you both have a common goal: To make your outsourcing program work! How do you work together to communicate effectively? The two most important factors in good communication on an outsourcing project are commitment to regular program reviews and agreed upon language for discussing issues. You can achieve this by following these five steps:

SLAs and Metrics


As early as possible you need to agree with your vendor on the tangible, numeric measures for your program. What are the service levels your program need and how do you define the measurements (metrics) that verify you received these service levels? This includes meeting deadlines, defining and meeting quality measures, and maintaining staff productivity. Without metrics to guide the conversation, a discussion about improvement issues usually goes, "The service isn't very good." With well-defined metrics, the discussion changes to, "The quality score for each project must improve from 90% to 94% within 60 days." Vague conversations are transformed into focused discussions about meeting measurable goals.

Management Reports
Once you identify the right metrics, you need to report on them monthly. Don't be surprised if there is disagreement over how numbers were defined or collected. This is normal, especially the first time you create a management report. Over time the report will improve, and you will have time to rethink the importance of different metrics. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 50

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Monthly Agenda
Once some initial problems are worked out, your program will fall into a regular rhythm. Part of that rhythm is a monthly meeting with your vendor. When you don't meet, problems build up and eventually a crisis develops. Your monthly meeting should review metrics, identify improvement initiatives, and discuss any new business. The monthly agenda is absolutely critical to the meeting, and must be delivered a few days before you meet.

Other Meetings
You also need three quarterly meetings and one annual meeting (each of which can replace a monthly meeting). Because improvement initiatives take weeks or months to show progress, discussing initiatives in a quarterly meeting is more productive than discussing the same initiatives every month. Likewise, the annual meeting is a better timeframe for looking back on the total success and challenges of your outsourcing program: What was accomplished, how has the program changed, and what can we expect in the coming year?

Attendees
Meetings without the right attendees are not productive. Both the vendor and the client need to commit time to management meetings. When sponsors of an outsourcing program fail to show up at quarterly or annual meetings, it is a sign of management problems. While monthly meetings can have more junior attendees, a constant downgrading of attendee seniority is another sign of management problems. Make sure that managers are receiving the content they need, or they will have no reason to attend. Remember, once managers stop paying attention to program meetings, just a little while later they will stop paying attention to the program. If you establish a common language for communication and agree to a regular rhythm of meetings, you will identify problems in their earliest stages and prevent operational issues from damaging the relationship with your vendor. Providing attendees with a management report and agenda before the meeting not only helps attendees understand why they need to attend, it also gives them what they need to meaningfully participate in the discussion. If you already have a difficult relationship with your vendor, follow these steps and you might be surprised by how quickly the relationship improves!

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Chris Niccolls http://outsourcing.about.com/od/governance/a/Ratcheting-Up-Outsourcing-Success.htm

Ratcheting Up Outsourcing Success


As 2012 comes to its conclusion, you can look BACK on what has been accomplished, what we have learned and which battles ended in victory. Others prefer to look FORWARD to what still needs to be accomplished, plan on what we need to learn, and consider the battles that we hope to win. Of course, in Washington the past and the future are pretty much the same thing. The big fiscal battle of 2012 is a repeat of the big fiscal battle of 2011. Discussions about how to raise more revenue from taxes was pretty much the same as last year. Of course, when we look at the debate on cutting costs, the argument has changed 360, and were talking about exactly what we talked about last year. With just a bit of luck, we should be back to where we were the talks crashed in July of 2011. Wouldn't life be a lot easier if every time they make some progress in Washington you could nail it to the ground, and then build on that progress instead of this treadmill without moving forward? For most of us this life on a treadmill is nothing new. This is the way that life works. You mow the lawn, a little later you need to mow it again. You send your kids to school, watch them graduate to the next grade, and at the start of next years classes they seem to have completely forgotten everything they were taught. In Greek Mythology, a particularly odious character by the name of Sisyphus has a special fate when he dies; every day he must roll a huge bolder uphill, but just before he completes his task, the bolder gets way and lands back at the bottom of the hill. Definitely a familiar feeling! When we look at work, we can see all the projects that were successfully completed. Yet, when we add them up especially over a period of years something strange happens. The total benefits for all the products don't add up. Lets say that you had a few improvement projects this year, and a few the year before, even a few before that. Each of these was supposed to reduce costs or improve some other metric. Assuming that you had specific metrics and benefit targets for each project, when you add up all of these improvements and apply them to your current operations, you will probably see something doesn't add up? By now, you should be much more efficient, operating for a lot less, and getting much better feedback from your users. If thats not happening, you have to ask yourself, Why aren't all of these programs ratcheting up my performance? Thats an interesting word, ratchet. Have you ever seen a ratchet? Its just a gear, with a thingy (technically, its called a pawl, but thingy will do for now) that drops into the gear to stop it from slipping backwards. Ratchets are very old technology that pre-dates the Roman Empire. Backsliding has been a problem for a long time! The ratchet merely acknowledges physics: anything at rest wants to return to its position at rest. If its your job to make that thing rise upwards, youre fighting all sorts of powerful forces: in physics it's La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 52 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com just gravity, but on your job its also culture, personality, convenience, and other forces that always want to return to where they started. In the world of physics and of work, you need to put something in place if you dont want your work undone. A ratchet is a pretty good idea. Lets see how this works. Lets say that you wanted to lift a heavy weight. You've got a weight on a rope attached to a simple pulley, and the rope is tied around the weight. You pull the rope with one hand, but its too heavy. You now pull with both hands, and the weight rises up! But after one pull, what do you do next? You need to let go, grab the next length of rope and pull again. But once you let go, the weight falls back. However, if there was a ratchet, the weight rises as you pull, but when you let go the pawl drops into the gear and stops the rope from gain backwards. You pull again and it rises, and stops. You repeat until the weight goes where it is supposed to go, and someone there takes the weight off the line. Progress! If youre working hard on an outsource project, youre putting projects in place, but you aren't making headway, you need something that works like a ratchet. In knowledge work that thing is continuous improvement. This is a general philosophy that operations can become better over time, through a series of improvement projects. Think of each project as a click from the ratchet, as you move forward. There are many different variations of how to bring aboutcontinuous improvement, but here are five simple steps to get you started: TARGET: Decide what you need to improve (or which weight you need to lift). Not every improvement has equal value to your organization. Lower cost is always a good idea, and it should be an annual goal for your organization, every year. But you need to listen to your customers and focus on what will make them happier. If users complain about service quality, focus on quality. If no one has an issue with meeting deadlines, dont make that your focus, even if you can easily improve it. Target your biggest issues, so that your efforts are meaningful to your customers. It may surprise you, but improvement to areas your customers didn't ask for can make them angry. Why? Because it tells them that you aren't listening. Instead of praise, you may hear, If you spent your time on what we want, instead of what you want, we would be happy. VALUE: Now that you've prioritized your options and chosen the projects that will make the most meaningful contribution to your services, you need to assign a value to the potential improvement. Think of this as designing the spurs on the ratchet. Whether the improvementsare designed to affect the amount of staff, reduce the number of contracts, or make staff time more effective, you need to assign a value to each project. Each of these projects needs to be carefully measured to come up with a total value for all the projects. Be careful! When you measured the value of each item, did you allow for interaction? For example, if there are three automation projects that are each expected to reduce staff by 10%, how much will that reduce total staffing? Three times 10% = 30%, so you can expect the operation will only cost 70% of the original cost when youre done, right? Not quite. After your first project, if it works exactly as planned, the operation will have 90% of the cost. If the next project reduces this by 10%, the next saving is 9%. The third project on 81% of the cost yields an 8% savings, and so on. The three projects reduced your cost to 73%. This is a VERY simple model. In the real world, the math can get complicated, so dont be surprised if the total of all of your projects is quite a bit lower than the total value of each project. Make sure that you have carefully measured the clicks you planned on. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 53

www.efficaciapersonale.com MEASURE: Now that you have projects and expectations for your benefits, you need to refine your measurements. How will you be sure that each project measures up to your expectations? Your target may be to reduce the number of missed deadlines. But how will you measure this? How specific is your deadline? When youre waiting for the cable guy to show up, the appointment usually looks like, Monday from 9AM to 5PM. If he shows up at 4:55PM, do you feel he is on time? If your measure is by the day, then how do you even capture smaller improvements? Perhaps when you first start to give a deadline, you start with the day, but you need to move to the hour and even the minute. But when youre down to the minute, the exact way you measure still matters! If everyone who works in your operation just looks at their own watch, everyone will have a different time and a deadline becomes arguable. Have you ever gone to a store with a sign on the door that says "closes at 6:00," and at 5:45 the door is locked? Isnt it frustrating when other people loosely interpret the time? In your workplace, do you have one clock that you can turn to and say, This and only this clock is the real time for any work we do! If people are in different locations, you can synchronize the time on all PCs in a network or on a specific server (if staff is in different time zones, agree on one-time zone as universal time, and dont get caught by Standard vs. Daylight saving's time!). Measurement means both having the right amount of precision (the refinement of the measure), and the right definition of how you collect that information (always use the clock on the wall, not any other time). This is how you check that the ratchet is working the way you expect. REPORT: Accurate and readable reports are absolutely necessary to make this process work. Every click and turn of the ratchet you built must be reported. If you think you've progressed 20 clicks of the ratchet, you must verify this. The management report is like adding a device that counts ratchet activity. Typically, when we have projects we do measure the clicks as we move forward. But we rarely check to see if other actions undo our progress. Perhaps another project in order to move its metrics forward, does something that undoes the progress on your project. By attaching a reporting device to the ratchet, we can immediately identify backsliding as well as unexpected moves forward. Examining both will tell us how to improve our operation. Remember, even the best staff doesn't always do what you tell them to. Often, this divergence comes from your staff trying to interpret your instructions (change a process, add staff, reduce staff, cancel a contract, send staff to training, etc.), and improve on what they've been told to do. It is important to remember that no matter how valuable a management report is, reports do not run your operation nor do they improve it. Reports only identify interesting things, both good and bad. Reports tell us where to look, and where to put effort. From reports, we learn when projects do not yield the results we want, and where we need to concentrate our attention. Instead of trying to look at everything, not very effectively, focusing our efforts on specific issues makes it more likely that we can fix issues. Likewise, you may see that there are unexpected improvements. By identifying and then understanding these anomalies, we may find ways to further boost these positive results. At a minimum, when we find that something good is happening unexpectedly, we can learn how to apply a ratchet to these improvements and hold them in place. CORRECT: In real-life things go wrong. Even the best designed ratchet will sometimes slip. Or it can jam. Or you may have just miscounted how many clicks you made on your ratchet. Assume that problems will arise. Prepare for this by having backup plans ready, and carefully observing the results in your management reports. When some metric slips, or a La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 54 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com deadline isnt going to be met put your plan B in place. Is this an unexpected issue that does not have a plan B? No problem. If you anticipate a problem, you are ready to act when it occurs. Is the data you need in your report, or do you need to add something new to the report? Should your report move from monthly to weekly so that you can more quickly measure results? As long as you know that making changes can provide the answer, you will be ready to act quickly! If you follow these five steps, you will be able to improve your progress on existing projects but also hold onto the benefits of the projects of the past. When you do both, then your outsourcing program can begin to truly improve. Over time, the combined benefits from all of these programs will be combined to develop a truly transformational program! La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 55

www.efficaciapersonale.com Chris Niccolls http://outsourcing.about.com/od/feasibility/a/Outsourcing-Experiment-Don-T-Just-Move- Improve.htm

Outsourcing Experiment: Dont Just Move, Improve!

Outsourcing is, or at least should be, about a lot more than just moving jobs to a place that plays less. Putting work in a lower-cost location can be a legitimate part of outsourcing, but when cost arbitrage is the entire program, you are almost always headed towards trouble. A program that only lifts and shifts does provide benefits short-term benefits. The failure rate for outsourcing programs is usually 50%. Of course, that was before the current wave of outsourcing, where project selection has been far less stringent. This rush to outsource, with a focus only on cost reduction, will almost surely result in a higher failure rate. The reasons for failure are usually obvious, and often easy to correct. If youre going to run an outsourcing program, you also NEED to run an improvement program. Ignoring the importance of improvement invariably sets you on a path to failure. When business functions are identified for outsourcing, the first programs on the list arent at the top by accident. Yes, many programs will have a goal of costs reduction; but to move to the top of the list, a program has also been identified as a poor performer: customer complaints, lack of internal metrics, problems with on time delivery or excessive errors and defects. Moving work to a lower cost location provides a one-time cost benefit, but it doesnt change the way that the work more efficient. At the end of your 1st contract, when the original benefits are now 3 or more years in the past, your team will expect new improvements in the next agreement. However, without innovation this expectation will not be met. As the economy continues to improve, costs are rising. Costs are risking very slowlydomestically, and much more rapidly offshore. Remember, your local economic conditions are not the same as where your offshore program operates. After all, you chose to outsource to these locations BECAUSE they had different economic conditions. Take a location like Fargo North Dakota. Fargo has had consistently lower unemployment than most big cities. Today Fargo has an unemployment rate of 2.8%, vs. 9.6% in New York City. Lower unemployment is driving higher wage increases. Offshore, the metric to watch is the rate of inflation. In India, the rate of inflation in May was over 10%, vs. -0.3% in the US. However, even if you moved all of your operations to India, not all of your outsourcers' expenses will be in India. Your rate may not increases by 10% times the number of years in your contract, but you can expect a much a larger increase in rates offshore than onshore. Thats why outsourcing has got to do more than just lift and shift. You MUST have continuous improvement. Go back to the reasons why your services were outsourced in the first place. Have you tried to address these issues before you outsourced? Did you know the La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 56

www.efficaciapersonale.com changes you needed to put in place, but you didnt know how to get approval to implement the changes? After the advantages of arbitrage exhausted, and your second contract begins, you need an offset against rising contract costs. When you build your first contract, there is usually pressure to create a management by contract culture, making it difficult to implement significant programatic changes, even if these changes will improve the project or further lower cost. Perhaps its just a matter of lack of trust. But once the benefits of arbitrage are exhausted, you need to turn to process improvement. What can you improve? Virtually everything! If your service was generating excessive customer complaints, then it could be that: the staff is not properly trained; the metrics for the function have not been defined; management reports are not being produced; work products are not being tested for quality; the wrong products are produced, etc. Each of these problems has different solutions, but these solutions are not directly related to the cost per hour for workers. If you had a problem with on-time delivery, and the solution would cost nothing to implement, but would involve fundamental changes to process what are the processes built into your contract for approving this sort of change? In most cases, outsourcing contract have no explicit process for approving major process changes. Most manager will not have solutions at the ready for their outsourcing programs. In order to find the right solutions, these managers need the freedom to experiment. Todays total outsourcing contracts do not allow managers that freedom. Unless this is corrected in their next contract, innovation in these programs will grind to a halt, and will not be able to offset the rising cost of labor in the most popular outsourcing locations. Thats why innovation is not an option, its a necessary part of every successful outsourcing program. If your program has contractual restrictions that will prevent you from experimenting with the way you perform work, you need to start working on a new contract framework. If you allow for outsourcing innovation, youre going to take a big step towards guaranteeing your programs success! La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 57

www.efficaciapersonale.com Chris Niccolls http://outsourcing.about.com/od/feasibility/a/Kill-Email-And-Take-Back-Time.htm

Outsourcing Experiment: Kill Email & Take Back Time


If your only outsourcing goals are to move staff to a lower-cost location, you may be dooming your program before it even starts. Outsourcing is an opportunity to re-invent your operations. Every operation undergoes changes as it develops. If your operation has been running for 10 or 20 years, it has accumulated a lot of out-of-date procedures and ineffective processes. This is your chance to shake the dust off of your operations and throw out the deadwood. There are all sorts of ways that you can improve your operations, but today were going to focus on a universal problem for all modern operations email. Who hasnt complained about the time wasted on email? Emails that you dont need, emails that you dont understand, long emails that you need to read through only to find out they dont apply to you, emails that are just a complete waste of time! Heres your big chance if you can deal with the fundamental problems of email, productivity might skyrocket! Get this one process improvement right, and any of your outsourcing projects would get a huge productivity bonus! The irony about email is that way back in the 80s, email was going to be the great savior of productivity. It would speed communications, allow vital communications to bypass bureaucratic gatekeepers and do it all practically for free. Surprisingly, it worked! Email was so effective that levels of unnecessary management were wiped away, and corporations became considerably more effective. But then, as always happens, unmonitored good ideas turned bad. Where you once sent physical mail to one person, you now send it to 10, or 100, or more. A small idea or question wasnt worth a phone call, but its worth an email to a distribution of people. If youve written a report, surely there must be hundreds who can benefit for it and they all have email! Then there are the emails you get by mistake, because you cant get off a distribution list, or your senior enough that everyone sends you a copy of everything. And of course, there is always SPAM. In fact, there is so much SPAM, that a booming business has been built around filtering it. From boon to bane in just a decade; thats a great metric to keep in mind when the next paradigm shift comes along! Too many emails slows us all down. Recently, a large European IT firm examined its own email situation and decided to put together a plan to remove all email. Of course, this is a drastic step, and it will take years to accomplish, probably by way of putting in new applications that will revolutionize productivity. For a while anyway. What was it that Atos found that made them make this move? Employees were spending on average 15-20 hours a week reading internal email, yet at most only three hours of that effort was for emails that have any business relevance. So, you can recover 12-17 hours of productive work time per employee.Other studies have shown similar results. Roughly speaking, if you get around 100 emails a day these numbers apply to you and your staff. The reasons for the flood of internal junk mail are many, but it all comes down to poor management. When everyone is forced to read junk, it costs the firm real money. Lets say that your firm has 10,000 workers, and that they can go through an internal junk email in 1 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 58

www.efficaciapersonale.com minute. Thats 167 hours of work time. If the average worker is paid just $30 per hour, that means that each junk email costs $5,000. Repeat that 80 or 90 times a day. If this was any other resource, using paper or buying a computer, your procurement department wouldnt let you spend this amount of money without authorization. Worse yet, when you outsource and have two companies involved you may double the amount of emails! How do you get yourself out of the email trap? AWARENESS: Collect some data and find out how many email your group reads, and how many are relevant. Perhaps, you dont have an email problem. Alternatively, your email problem is even worse than Atos experienced. The only way to know is to look! ALTERNATIVES: We use email to send out notices, move around files and perform many other functions. Map out all of these functions and how they should be handled. ETIQUETTE: A lot of junk mail is sent because individuals dont know the consequences of their actions, or the alternatives. You need to develop an email etiquette, and then you need to develop TRAINING: Dont just send around an email telling everyone not to send emails. Yet, some firms think this will actually work! Have classroom training. Yes. Its an investment in time, but time is what youre trying to save. Make sure that the is time form questions and answers, and interaction with the trainees. MONITORING:Once you gain some headway on email, its just like any other metric. You need to monitor the numbers and make sure that you dont backslide. You also need to identify individuals who arent following the rules. Some gentle reminders, and perhaps a little training may be all it takes to hold back those unnecessary emails. Email has become the universal time trap, but you can turn it around into a universal performance booster! There are few other levers in the work environment that provide this level of improvement. With just a little thought and effort, you can significantly increase the effectiveness of your outsourcing program, and provide a real boost to the bottom line!

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Biz3.0 http://biz30.timedoctor.com/15-essential-outsourcing-tips/

15 essential tips for outsourcing decision making


If youre a business owner or manager and are considering outsourcing of any type, youre probably aware of the huge risks that can be involved. If youre not you should be: placing the future of your business into the hands of strangers can quickly go pear-shaped. While hiring staff that you may never meet face to face, might seem like a gamble, there has never been a better time to try to leverage online outsourcing, especially once you know how to avoid some of the more common pitfalls involved. So what specific steps can you take to ensure things run smoothly? Weve drawn up a list of the best practices to help you avoid outsourcing mistakes; these 15 best practices will hopefully save you time and energy and shield your business from the sort of mistakes that could bring your efforts undone.

1. Outsource the Right Activities Outsourcing is a huge step, and the question of which activity to outsource is one of the most important. Be careful not to give up your companys competitive advantage. Retain control over aspects that make you unique or define your business. If youre already a leader in price or service levels in an area, dont outsource it. While you need to have a good grasp on an element to be able to effectively manage it, its important not to change the parts of your company customers appreciate the most. Increased demand doesnt always mean outsourcing is the answer. If you already outsource some work to freelance agents, ask them if theyd be willing to take some more on. Perhaps some area of your business has extra staff or time to complete a new project. Working with someone you know who is already performing well makes sense, and youll save time training newcomers. Avoid outsourcing any areas of your business that will directly impact customers. Although there are some companies that do well hiring vendors for customer service or sales, its a risky venture that small businesses or companies in transitory stages can not afford. If demand in a part of your business is outgrowing your staff or resources, outsourcing is a natural decision. Does one department moan that they just dont have time to keep up with all the work? Maybe you stay up all night working on web design when you should be sleeping so you can make smart decisions the next day. Either way, outsourcing this element of your company can reduce stress and help you meet customer demand. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 60

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2. Own Your Website If youre interested in making a move toward outsourcing, the chances are you already have a presence online. Your own website is the beginning and end of your presence online, so make sure people will always be able to find you. Its a common mistake to let a supplier control your domain, and one of the most potentially disastrous. When someone else owns (or registers) your domain name, your site could be taken down by a programmer, designer, or even the software running the site. Be sure youre registered as the owner of the domain by using a service such as www.whois.net, and be sure you have registrar control find out who currently has registrar access and be sure your name is included. Never share your registry level access with a programmer. Even the most complex of changes can be easily coordinated via registry support, or by coordinating a team viewer session with the programmer so you can see what they are doing. 3. Consider All Outsourcing Costs Although many times companies decide to outsource because they expect to save money, bare in mind that it is very unusual for actual and projected savings to match. Particularly in the first several months of a partnership, plan to save about three quarters of your projected amount, due to adjustment, time loss, and other factors. Beginning an outsourcing relationship has costs that may not come to mind at first. For instance, when choosing the right vendor, you will lose time and may encounter fees from networking websites or other sources. Negotiating and drawing up a contract in some instances can carry legal fees, and continuing the relationship will have costs in time or possibly travel. 4. Choose the Right Help It will take time to select the vendor or workers that will fit best with your needs, so resist the urge to hire the first party you contact. Even if they end up being the right decision, take the time to compare and contrast their strengths with other providers. Also spend time shopping around on outsourcing sites. Choose a company who specializes in just what you need you want their strengths to line up with your goals. There are many factors to consider when choosing who to start a business relationship with. Of course a quality product and great price will factor into your decision, but that isnt all thats important. Has the provider shown consistent improvement during its time doing business? Are they well-established in their field? Youll want to take experience, location, flexibility, tax laws and language or cultural barriers into account. 5. Consider Reviews and Feedback La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 61

www.efficaciapersonale.com You may be hiring a contractor on a website that lets you view other users feedback or reviews. Read these carefully, and take them into account when weighing one contractor against another. If a member with a substantial amount of positive feedback will be a bit more expensive than a member with negative or no feedback, its probably worth it. In other situations, the best reviews come from other business people or your friends. Ask them if theyve had experience with any companies in the area you need. They may have tried-and-true suggestions that will make the whole process easier. 6. Interview Carefully Since in most cases when you outsource youll be monitoring the area from a distance, the interview process is your one opportunity to really get to know a potential employee or contract hire. Talk to a prospect for long enough to get a real feel for their personality. Ask questions based on prior experience suggest a situation and ask how they may have handled events before. Listen carefully for red flags such as a negative attitude, disregard for rules and deadlines, or aversion to feedback. 7. Rule Out Lowest Bidders Although saving money can be tempting, as the adage goes, you get what you pay for. While you dont need to hire the most expensive option, the pay a worker requires is often a reflection of education, experience, and work quality. While you dont have to splurge, dont skimp too much, either you may regret it. 8. Take Your Time In addition to not rushing the choice of a vendor or contractor, you dont want to fly through the transition process either. The partnership will be more successful if you give the contractor a bit of control and assign the rest based on performance. This period will allow you to ensure things are going well before entrusting them with a larger portion of business. 9. Maintain Control Over Outsourced Components Its critical for you to remain in touch with the elements of your business youre outsourcing. The best way to do this is to have staff whose sole responsibility is overseeing the relationship. These employees should be skilled managers who understand your corporate vision well and can monitor the outsourced activity to be sure its in line. 10. Set Clear Objectives While you want your team to work well independently, its important to keep lines of communication open, especially when it relates to your goals and expectations. For whatever projects youre outsourcing to become successful, you must clearly communicate exactly what you need and provide your vendor or employees with a description of their roles. Be detailed and specific when explaining metrics to meet, quality expectations, scope, and deadlines for the project. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 62

www.efficaciapersonale.com Think about what components are important to the project and come up with a scale to judge them on. In some situations, it may be possible to monitor quality by having your own personnel play mystery shopper. Be sure every aspect of quality monitoring is clearly defined and can be tracked consistently. Whether your team is meeting goals or falling short, you should pass that feedback on to them directly. As long as you focus on the positive as well as the negative, theyll appreciate the direction. Be as specific as possible receiving a failing report is useless, but getting suggestions on how to improve can be valuable. Which leads to the next point: 11. Write Everything Down In many outsourcing situations, you wont have very much face-to-face contact with those youre employing. This can make clear communication tricky. Meetings by telephone are a good idea, and a way to bridge the gap working long-distance can create, but they arent the best way to pass along important information. Technical difficulties too often get in the way, and theres no way of knowing whether the person youre speaking with is in a calm area or a distracting one. Written communication, whether its a memo or an e-mail, has the crucial benefit of leaving behind a clear record. Anything you want your team to remember or refer back to should be communicated in writing. Talking face to face is an excellent way to build relationships, but important information should always be written down, including feedback, guidelines, procedure manuals, and expectations. 12. Aim for Transparency Since outsourced work, by description, takes place out of your sight, its important to make up for that by putting transparency practices into place. Set meetings periodically once a week, once a month, or whatever makes sense for your partnership and discuss key elements of your business. This face time, whether its an in-person meeting or a video chat, will help avoid delays, setbacks, or misunderstandings and keep both parties informed. Dont forget to send a memo afterward highlighting main points of the discussion. 13. Write a Solid Contract This is especially important when dealing with a services vendor. Your contract determines the dynamics of your partnership, and works in two ways. It establishes expectations at the outset of the relationship, and serves as a record to refer to from then on. A contract should outline specifics about payment, creative and other rights, expectations and roles, and outline an exit strategy. Its vital to have a lawyer review any contract you sign. If the vendor isnt meeting your established quality expectations during a specific time period, the contract should provide you with the option to terminate your agreement. If this isnt possible, at least set a date when the contract will be up for renewal so you can consider whether you want to continue. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 63

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14. Manage Current Personnel Carefully Once employees find out your company intends to outsource, everyone cant help but be on edge. They wonder whether they will be affected, and may be hurt or offended. Employees may feel your decision reflects on their capabilities. The best approach is to be forthright with all staff and partners, disclosing information once decisions have been made. Taking this step will let your employees know they can trust you and eliminate fear and rumors in unaffected areas. Some transitions may include your staff, in whole or in part, beginning to work for your new partner. Its important for you to facilitate the transition, communicating with the employee so they understand what to expect and making sure their loyalty is maintained. During this time, its also beneficial to identify key employees in areas that will be outsourced and recruit them to other areas of your company. Even if personnel will be replaced by the outsourcing vendor, there are things you can do to facilitate a smooth transition. Treat employees with respect and let them know they are valued. Sometimes staff can be given the option of transferring to other areas of the company. If not, provide opportunities for training that will give employees an advantage in their job search. It is never appropriate to ask current staff to train those who will be replacing them. Their emotional response to the request will not result in proper training, and its in poor taste. If you want to entice employees to continue working until a cutoff date, it helps to reward those who stay with severance packages. These sometimes include health benefits and can be a lump sum or several payments, the amount depending on years of service and pay. 15. Keep the End in Mind All good things must come to an end, and hopefully your outsourcing partnerships will end gradually and on mutual terms. However, its best to be prepared in the event of the worst for example, if demand increases drastically or a vendor goes out of business. Have a plan in place that you could put into action tomorrow if needed. Can other areas of your business take on the workload? Is there a similar provider youve interviewed and are comfortable with? While you hope a transition will occur when you have time to prepare, the safest route is to plan for just-in-case. When youre well-prepared, outsourcing can grow your company in key areas. Its an opportunity to capitalize on your strengths and find ways work more efficiently. But its also a time when mistakes can be fatal. By avoiding the pitfalls in this list, youll be able to focus on increasing productivity, quality and savings and isnt that the point? La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 64

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Ilan Oshri http://www.computerworlduk.com/how-to/outsourcing/2926/seven-steps-to-effective-outsourcing- measurement/

Seven steps to effective outsourcing measurement

A step-by-step approach to outsourcing management


These days firms are, more than ever, pressed to demonstrate returns on their investment in outsourcing. While the initial returns can always be associated with one-off cost cutting, outsourcing arrangements are complex, often involving inter-related high-value activities, which makes the realisation of long-term benefits from outsourcing ever more challenging. Executives in client firms are no longer satisfied with the same level of service delivery through the outsourcing lifecycle. They seek to achieve business transformation and innovation in their present and future services, beyond satisfying service level agreements (SLAs). Clearly the business world is facing a new challenge: an outsourcing delivery system of high-value activities that demonstrates value over time and across business functions. However, despite such expectations, many client firms are in the dark when trying to measure and quantify the return on outsourcing investments. Results of research[1] that we conducted with Cognizant in 2009 show that less than half of all CIOs and CFOs (43%) have attempted to calculate the financial impact of outsourcing to their bottom line, indicating that the financial benefits are difficult to quantify (51%). There is no doubt that client firms need to improve their ability to measure the benefits of outsourcing. These benefits go beyond the one-time cost saving. They strongly relate to the firms competitive advantage and therefore often represent the key success factors (KSFs) in a particular industry. Our research has led us to identify seven lessons that will guide executives to achieve better results from their outsourcing engagements.

Lesson 1: Figure Out the Context of the Outsourcing Activity A good starting point is to understand why the firm would like to outsource a service and what resources are available to successfully carry out an outsourcing project. We observed a La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 65

www.efficaciapersonale.com couple of common mistakes in this regard: a bandwagon effect in which firms outsource because the competition does so (also known as me too strategy) or firms outsource a problem. These are the wrong reasons to outsource a service, and the consequences can be dire. Instead, firms should follow a systematic approach to analysing the context of the outsourcing activity. There are several criteria that a firm should examine, including the overall goal, how critical the service is to competitive advantage, how dependent the service is on other inputs from the firm, how work will be codified and monitored (and the precision of the metrics) and how mature the firm is in managing outsourcing arrangements. Exploring these areas should deliver a clear understanding of the drivers to outsource, internal resources and expectations. Realising the benefits of an embedded service that is difficult to codify could be challenging as it increases operational risks. Likewise, outsourcing processes that are difficult to monitor (e.g. R&D, supply chain coordination); in particular when the firm does not have precise metrics to evaluate quality, is not recommended. In these cases, the firm should examine its maturity level in outsourcing. A high degree of outsourcing maturity and sophistication will allow the firm to devise methods that overcome certain challenges and help to mitigate some operational and structural risks. Lesson 2: Figure Out the Outsourcing Strategy The outsourcing strategy will dictate the complexity of the outsourcing arrangement and therefore the ability to realise benefits. Our advice is simple: choose an outsourcing strategy that the firms resources and capabilities can cope with. By doing so, you will be able to assess and realise the benefits gained from your outsourcing arrangements. Surprisingly, many firms experiment with sourcing models that are beyond their organisational capabilities. For example, in recent years many firms experimented with multi-vendor sourcing arrangements. We noticed that few firms can actually realise the benefits offered by the multi-vendor model. It takes advanced sourcing capabilities to effectively manage a single vendor in a particular business function, let alone multiple vendors transformation programs across several business functions. that coordinate several

Another example is the outsourcing of a range of services within a particular business function (e.g. HR) to a single vendor. While the client might perceive this as a straightforward arrangement in which the benefits should be easily realised as there is only one vendor involved, the client will in fact need to develop sophisticated outsourcing capabilities that will allow the benefits from synergies between outsourced services to be achieved. We have learned that most clients have failed to realise this promise. Lesson 3: Figure Out the Benchmark La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 66

www.efficaciapersonale.com Many firms rely on Service Level Agreements (SLAs) as the main means through which value from an outsourcing arrangement can be realised. SLAs are critical in any outsourcing arrangement; however, they dont give the entire picture and in some cases can be misleading. Firms that rely on SLAs to realise the benefits from outsourcing arrangements are essentially monitoring service performance, which can be meeting the service provisions; however, offers little transformation. Therefore, the challenge for firms is to realise the impact of outsourcing on the business and not on the service performance. For this reason, firms must figure out the benchmark to use when measuring real benefits, usually a key success factor (KSF) in that industry for example, time to market of a new product or quality. Once a benchmark has been identified, SLAs can be drafted to correspond with the provisions that generate a competitive edge. This ensures that the aim of the client and the vendor is to improve the firms competitive advantage through business transformation that is monitored through a set of SLAs. Lesson 4: Realise What is Value Over Time Value is a dynamic concept. The desired value to be delivered from an outsourcing arrangement set by the client and vendor at the beginning of the project is destined to change over time. Few firms are aware of this and even fewer take steps to mitigate this risk. Clearly, by not sensing the changes in value over the outsourcing project life, disagreements are likely to emerge between the parties, which will eventually erode the projects benefits. At the same time, the dynamic nature of value does not mean that clients are entitled to redefine their expectations every week. There should be a joint approach to address this challenge. The first step is therefore to develop sensing mechanisms for changes in value. Sensing mechanisms are best supported through shared learning between the client and the vendor. The more shared learning opportunities are created between the client and vendor teams, the more likely that value as a dynamic concept will be monitored. Our research found that value is best sensed when the outsourcing arrangement is based on relational value. Under such circumstances, efforts are put into the development of the supply network relationships by responding to the changing nature of value. Lesson 5: Make your CIO a Strategist Many CIOs do not speak the business language. Most of them are not executive board members. Several have emerged from the IT ranks and often had little exposure to and involvement in shaping the firms business strategy. In recent years some argued that in fact the role of the CIO is now less strategic, mainly because IT can no longer be considered as a source of competitive advantage. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 67

www.efficaciapersonale.com However, in the last fifteen years, the CIO has led outsourcing projects and transformed the way services are designed and delivered. The boundaries of the firms have been redefined and sources of innovations have been reconsidered. Nowadays CIOs are, if anything, more strategic than ever and their role within firms is destined to grow. However, to cope with such changes, CIOs need to learn. They need to learn the business language spoken at the executive board. They need to learn to design and argue a strong business case for an outsourcing arrangement at the strategic, operational and financial level. They need to learn to focus on business improvement processes rather than service improvement processes and on business transformation rather than IT improvements. Their role within the organisation should be more central, with a direct influence on decisions made at board level. A CIO then should become a central figure and a driving force in implementing the other lessons. Lesson 6: Build the Retained Organisation The CIO alone will not be able to transform the firm and deliver value from outsourcing arrangements; however, the CIO can and should build the retained organisation to act as a change agent that monitors value delivery. Most firms consider the retained organisation as the minimum resource needed to support IT function continuity. The mistake in this approach is the focus on IT function continuity. Instead, the retained organisation should be perceived as the resource that drives a firms transformation and innovation. For example, in many outsourcing arrangements the client transfers staff to the vendor. A common mistake is for firms to keep bright and talented staff in house, rather than transfer them across to the vendor in those areas that the vendor is expected to take leadership, for example application development. At the same time, the CIO should build new expertise within the IT function to ensure that its focus is on continuity, transformation and innovation. But the retained organisation includes other capabilities, such as relationship building, which concern the wider communication between business and IT communities. It involves helping users understand the potential of IT for the creation of value, helping users and IT experts collaborate, and ensuring users ownership and satisfaction. For most firms this is a major challenge simply because of the tremendous difference in culture between techies and users. Role holders with this capability have to facilitate a shared purpose and constructive communication among people engaged in the business and the IT function. Without this capability, the retained organisation will enable IT function continuity, but will fail to demonstrate the benefits of business transformation. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 68

www.efficaciapersonale.com Lesson 7: Invest in Outsourcing Learning Capabilities One of the most critical capabilities that outsourcing clients need to develop is learning. And still, clients tend to take a narrow approach to learning by focusing on learnt lessons from a single outsourcing arrangement and often paying little attention to building a learning capability across multiple outsourcing arrangements. Furthermore, clients often apply all their resources to ensure that vendors meet the service provisions while ignoring opportunities to learn from them. Consider the vast experience acquired by a vendor over time in a particular industry. Also consider the growing specialisation of vendors in a particular industry or technology achieved through the knowledge acquired by centres of excellence (CoEs). Experts from these CoEs have dealt with multiple outsourcing arrangements, reviewed numerous contracts, negotiated benchmark and SLAs metrics and work together with various clients to achieve success. Furthermore, some leading vendors have perfected their knowledge management systems to ensure that their learning capability supports multiple engagements in an efficient manner (e.g. reuse of concepts). And yet, clients, as we learned, refrain from consulting with these experts. It is still the notion of us and them that inhibits learning between clients and vendors. Removing these learning barriers requires vision and courage. If a firm is to become a sophisticated outsourcing player, it has to learn from its vendor firstly to avoid mistakes we have seen made again and again by inexperienced clients and, secondly, to improve the benefits that can be gained from an outsourcing arrangement. Any firm would like to clearly present the benefits from its outsourcing arrangements. However, many firms will eventually realise that they dont know what exactly they have gained and at what price. The simple reason for that is: the journey to realising your benefits from outsourcing arrangements cannot allow any shortcuts. Being in a position to realise the real benefits from outsourcing requires a step by step approach, as has been outlined above. By following the lessons, firms can take better control of outsourcing contracts and ensure they are achieving their intended, specified goals.

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Bob Violino http://www.computerworlduk.com/how-to/outsourcing/3412178/7-outsourcing-nightmares--heres- how-to-avoid-them/

7 outsourcing nightmares - here's how to avoid them


Outsourcing IT functions can be a smart business move, particularly if your organization lacks specific expertise. IT infrastructure, networking, application development, help desk -plenty of high-quality service providers are available to fulfill your IT needs. But like other major business and technology initiatives, outsourcing comes with risks, regardless of how experienced the outsourcing provider is or how good the move looked initially. Outsourcer employee turnover, communication breakdowns, shortsighted contracts: They can all sink an arrangement, resulting in lost opportunities, downtime, or worse. In the interest of forewarned is forearmed, here are seven real-life examples of what can go wrong with an outsourcing initiative - and how to avoid or resolve these outsourcing arrangements gone amok. Outsourcing nightmare No 1: Outsourcing employee exodus Several years ago, Coalition (Technologies had a project for an important client that it sent to an outsourcing partner to complete. The Web design and marketing firm had worked with the outsourcing partner before, and the experience had been positive. The partner had been responsive and provided a high level of quality and communication, says Joel Gross, founder and CEO of Coalition. "Everything seemed to be moving along fine, until the project neared its completion date," Gross says. Then the outsourcing company's CEO contacted Coalition to report that more than half of the company's staff had quit. "They did not have the capability to complete the project," Gross says. "As a result, we had to scramble and find a way to resolve [the problem] internally on extremely short notice." While Coalition was able to deliver the work without too much added delay, it learned a valuable lesson about the risks of outsourcing. Now, the company tries to keep all of its critical IT work in-house, relying on a dedicated, handpicked (team.

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www.efficaciapersonale.com When technology projects pile up, Coalition does contract outside providers to perform basic tasks, Gross says. It might sound obvious, but including every possible contingency in the contract is vital. "Avoiding contracting nightmares is possible; you just have to lay the (ground rules," he says. "In order to ensure the quality and standard of work, we have a strict and explicit contract that must be signed." Payment schedules and consequences for late or bug-prone work are central components of those contracts.( Contractors receive 25 percent of cost funded upfront, another 25 percent upon beta (completion, and the remaining 50 percent when the project is complete and has been( certified bug-free by Coalition project managers. Coalition also requires that contractors submit two or three references that can provide feedback on the quality of work. Outsourcing nightmare No. 2: Offshore app dev delays shut window of opportunity Applet Studios recently switched to US-based programmers after a nightmare experience with its latest outsourced application development project. "We had one app live in the App Store doing well," says Chad Grills, co-founder of the company, which creates and sells Web and mobile applications. "We lined up all the promotions and advertising for the Android version, which was being built by( contractors outside the country." Grills exchanged several emails with the contractor, which assured him that development was on track and the app would be delivered within a week. At the end of the week, Grills received no deliverables and emailed the company again. The contractor responded five days later, saying that the developer had been sick. "I was understanding and asked for an update on the app," Grills says. "They said it would be pushed back another five days. I was frustrated at this point, but pushed back our advertising just in time." Some 10 days later, the offshore development team sent a completed application. "I started testing the app, and to my horror, it was a cruel joke," Grills says. "The screen, features, fonts were nothing like the detailed descriptions and iOS code I had sent." Things didn't go well from there. The app was delayed another three weeks, still full of problems. "Our advertising opportunity came and went," Grills says. "The marketing window for action closed, other projects couldn't be pushed back, and we had to scrap the app. Worse, the contractor didn't understand why I was upset." La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 71

www.efficaciapersonale.com Applet Studios is now much more meticulous about hiring outsourcers for development work and uses US-based contractors whenever possible. "The contract we signed with our contractor protected us for a portion of the development costs," Grills says. "However, it couldn't help the fact that we had a huge marketing opportunity/venue that we missed. With the app market being as crowded as it is, a missed marketing opportunity can destroy an app's chances at success." Outsourcing nightmare No. 3: Offshore communications breakdown Predominantly a Web-based business, California Contractor Bonds has outsourced its IT overseas for the past few years, primarily to India. "In the beginning we had several huge problems (in designing and maintaining our website that were primarily based on (communication problems," says Jeremy Schaedler, president of the company, an online provider of license bonds for contractors in California. "There seemed to be a constant flow of discrepancies between what we were asking to be done and what was accomplished." What Schaedler learned is that for design, the best form of communication is written instructions combined with diagrams whenever possible. "Too much is lost in verbal communication," he says. "Outsourcing IT overseas is a great way to get quality programming talent at a fraction of the domestic cost, but getting a quality product depends on establishing a clear method of communication." Providing written instructions solved the problems, and California Contractor Bonds now has few if any communication problems, Schaedler says: "In the last two years I have only spoken to my current programmer in India by phone two or three times, yet we correspond by [written] message two or three times a week on average regarding IT." Outsourcing nightmare No. 4: Poor quality, no recourse for refund Money Crashers Personal Finance is another company that has struggled with offshore Web development work. A few years ago the company, which provides online educational services in areas such as credit and debt, real estate, and insurance, decided to outsource a Web development project. Intent on keeping costs down, Money Crashers decided to go with an IT service provider overseas, says Andrew Schrage, founder and co-owner. From what Money Crashers could tell, the provider was highly qualified. "But after we paid for the job in advance, we ended up receiving results that were nowhere near our expectations," Schrage says. "To make matters worse, the [outsourcing provider] simply refused to get back to us regarding what we felt was shoddy work. After quite a few hassles, we finally gave up and couldn't retrieve the amount we paid upfront."

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www.efficaciapersonale.com What Money Crashers learned is that it's not always best to have cost as the No. 1 determining factor, as the company ended up paying far more in the end. "I'm not saying I'd never consider outsourcing a project again, but I would definitely take a different approach," Schrage says. First, he would never again pay for any job before it's completed. Next, he would require past referrals from reputable people who've hired the service provider in the past. Third, he'd ensure the people performing the work have a clear understanding of his business. "And finally, I would provide a specific, detailed plan of the job and discuss it at length beforehand, while also explaining the full payment would not be made until I approved the work as being up to par," Schrage says. Outsourcing nightmare No. 5: Unexpected overhead of outsourced management Joe Infante, a onetime IT project contractor for a specialty chemical manufacturer, offers an outsourcing lesson in one-size-fits-none. With nearly 30 sites around the United States, most of which operated with a high level of autonomy, the chemical company was well aware that outsourcing its IT support services would be difficult. Because of the magnitude of the challenge, the company brought in one of the largest global IT outsourcers, says Infante, who is now president of IT services provider Dynamic Strategies. Once the five-year outsourcing engagement was in place, gaps that weren't identified in the discovery phase as well as minor projects outside the normal service-level agreements were constantly cropping up unexpectedly, Infante says. The outsourcing provider had difficulty addressing these issues due to its one-size-fits-all approach. "A decision was made to continue to supplement with independent contractors to address these smaller, one-off projects and to fill service gaps," says Infante, who declined to identify the chemical company. "The arrangement quickly became difficult to manage and the outsourcer was removed." One of the main causes for the failed outsourcing engagement, which resulted in both lost time and increased costs, were underestimating the effort needed to manage the outsourcing relationship, Infante says. "Where the client thought it would take one or two individuals to manage the interface with the vendor, it actually took many more of the company's resources," he says. In addition, the client's interpretation of what it was buying - based on what it was told by the outsourcing vendor's sales team - wasn't interpreted the same way by the vendor's implementation and service teams. How could these kinds of problems be avoided? "Know thyself," Infante says. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 73

www.efficaciapersonale.com "The hardest thing for many businesses to do is properly assess their real needs and, more importantly, their current position regarding the state of IT. Properly defining these two components will ultimately determine what can/should be outsourced and which company best matches their needs." Outsourcing nightmare No. 6: Metrics without enough granularity to be meaningful Todd Taylor tells tale of an outsourcing arrangement gone awry due to differing needs among business divisions. Taylor, an attorney at Moore & Van Allen, who focuses on outsourcing and other technology issues and is familiar with the case, says the arrangement involved a large, multinational corporation and a large, highly regarded technology services company. The multinational had multiple business units that provide services for consumers and businesses, Taylor says. It outsourced portions of its network operations and infrastructure to the technology services company to support multiple divisions, each of which had different needs. The client spent time with the service provider coming up with service-level arrangements. But the service-level metrics were typically configured on a clientwide basis. "In other words, in determining whether a service-level metric was met - or not met performance was judged for the client on an enterprisewide basis rather than on a division or line-of-business basis or a specific service element basis," Taylor says. In many cases, certain business units or functions weren't receiving acceptable services, and this potentially hindered the ability of those units to meet their customers' needs on a timely basis. "The client had little contractual ability to demand correction of the problems, as the service provider was generally meeting the service-level metrics when such metrics were measured on an enterprise-wide basis," Taylor says. "Even when service levels were not being contractually met, the penalties often were not meaningful enough to incentivize the service provider to change behavior." One lesson learned, in ensuring effective service levels for all, was to engage the appropriate business and technical people in all business divisions relevant to the outsourcing agreement, and to do so from the outset, Taylor says. Companies should also define specific service levels at a micro level. "Representatives of the client receiving the services from the service provider [should] work closely with the service provider's representatives to define specific service levels that are relevant for each business division," and that address each service the client and its individual business units would receive, Taylor says. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 74

www.efficaciapersonale.com In addition, penalties and incentives should be meaningful. "The penalties should incentivize the service provider to meet its obligations," Taylor says. Another way to address this issue is to provide bonuses or financial incentives for performance in excess of service-level metrics, he says. Outsourcing nightmare No. 7: Downtime and disorganisation When public relations firm DPR Group hired an IT services provider in 2011, it experienced system latency, slow customer service, and problem tickets submitted daily. "This constant break-fix model resulted in increased downtime and [decreases] in productivity that hurt our business," says Dan Demaree, president and CEO. "When we submitted a trouble ticket, it would sometimes take days to hear from the technicians, resulting in lost productivity, downtime, and unnecessary time spent on IT maintenance." The service provider claimed to have a systematic approach, but the lack of a naming convention for DPR's computers and the fact that many of the people working on its systems were not familiar with them belied that assertion. "We would have to start from scratch each time we experienced an issue," Demaree says. "Beyond the technical challenges, documents were irretrievably lost, creating significant rework, and our ability to service and respond to our clients was being interrupted." DPR was spending too much time and money on an IT outsourcing model that was unreliable and even detrimental to the well-being of the business, he says. To avoid these issues, the firm searched for a proven cloud services provider to handle its IT. "Since we've moved to the cloud, we've had increased productivity, flexibility, and accessibility, and no downtime," Demaree says. "Our advice would be to do your research before looking into outsourcing your IT. Look at their track record, security, accessibility, and budgeting. Our current cloud provider has a history of zero downtime.

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Johanna Rothman http://www.computerworld.com/s/article/84847/11_Steps_to_Successful_Outsourcing_A_Contraria n_s_View

11 Steps to Successful Outsourcing: A Contrarian's View


Computerworld - During the past few years, we've been bombarded with news of outsourced call centers, help desks, testing, development, projects and entire IT infrastructures. It sure looks as if outsourcing is the way to go. Before you jump on the outsourcing bandwagon, ask yourself this question: What's the value of the knowledge your staffers learn in the work you're planning to outsource? That's the value you give up when you outsource. We have a history of looking for ways to bring down the cost of development. In the '70s, we moved to chief architect teams or other hierarchical teams a la Fred Brooks' Mythical Man-Month. In the '80s, we had structured analysis and design, followed by numerous computer-aided software engineering tools. In the '90s, we had object-oriented programming (with inheritance, wouldn't we get reuse for free?), components and more reuse. And let's not forget the mother of all productivity enhancers -- process. All of these techniques can lower the cost of product development. But what's happened? Every project seems to require more developers, more testers, more project managers, more requirements analysts, more process people and more managers. And with all those extra people, we still haven't figured out how to complete enough projects on time and within budget. There are reasons for needing more people, but in my experience, there are four big reasons for requiring more people for every project: poor management, technical debt, architectures that can no longer be extended and more complex systems. Poor Management I bet you know managers who regularly assign more than one No. 1 priority and more than one project to their staffs, expecting that somehow one brain can work on more than one problem at a time. We have more than our fair share of managers who arbitrarily cut schedules, refocus the project in the middle of the project and ignore obstacles. Poor managers dramatically increase the cost of development. Technical Debt If you've cut corners on previous releases in the past, you've incurred technical debt. Technical debt is work you owe the product. If you didn't completely design it or test it, you owe the product the work you haven't done yet. You pay interest on technical debt, the same as on money debt. The longer you wait to properly design, code or test the product, La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 76 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com the more it costs -- in time and/or money -- to release the next time. Technical debt requires more people per project to overcome, even for similar amounts of work. Nonextensible architectures Even if you have no technical debt in a product, at some point, every architecture meets the end of its extensibility. When the additional requirements outstrip the ability of the architecture to add those requirements, you're stuck with a nonextensible architecture. No matter how you try to shoehorn in more features, the features don't easily fit. If you try to shoehorn more features into the system, the system becomes more complex. The more complex the system, the more time people need to learn their parts of the system and the more people are needed to reduce overall project time -- which increases the communication complexity of the project. More complex systems We developed the easy systems long ago. Systems today are more complex than the most complex systems of even just 10 years ago. The more complex a system, the longer it takes to complete the work for a given release. When you use agile techniques or incremental life cycles, you can reduce the time per iteration, but you still require more time to complete what the stakeholders see as the entire system. Software project costs are primarily labor No matter which of these problems you have, the bulk of a software project's cost is labor. The more problems you have, the higher your labor costs. From a senior executive's view, it makes sense to cut salaries through outsourcing. Instead of paying a U.S. developer a $100,000 salary (loaded labor including overhead), you can pay a Canadian developer the equivalent of $50,000 or an Indian developer $15,000 or even less. Huge difference. Some executives believe that even if you need four times as many people, you can still do the job cheaper and faster (because of the round-the-clock project team) than you can if you keep the work in the U.S. In my experience, every outsourced project has taken longer and costs more than the original estimates. Remember, you're training these external people on your product domain. If you must ... But if you think offshore outsourcing may work for you, then make sure you remember these points. 1. Train the outsourcing staff. The outsourcing staff needs to know how the product works, both from the internals and from the perspective of knowing the problems the customer wants to solve. 2. Qualify the vendor. Does the vendor have domain knowledge? Is it financially viable? Are there contractual safeguards in place to keep control over the intellectual property you give it?

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www.efficaciapersonale.com 3. Assign one of your best project managers as your internal project manager.Just because there's a project manager at the outsourcer doesn't mean you don't need someone in your office making sure all the appropriate handoffs are happening. 4. Plan for your in-house staff to shift their work hours. If you don't shift enough people to work earlier or later in the day, then someone across the world who has a problem won't have someone to talk to. Too often, when an engineer at least eight time zones away needs information, no one is in the office and no one can be reached. Instead of round-the-clock work, the work is stopped until the engineer can determine the answer. 5. Document the requirements. If your native technical staff can't read your mind about what you want in the product, how can geographically distant, non-native English speakers understand your requirements? 6. Develop an appropriate change process. Especially if you have development occurring in multiple sites around the world, you need a clear change process to make sure only the changes you want are allowed. 7. Select outsource projects with nonvolatile requirements. If your requirements change frequently and you need to check out the evolving product with the user, development across the world makes it that much harder. 8. Plan for each project to take longer and cost more, especially at the beginning of an outsourcing relationship. My rule of thumb is to increase the estimated time by 30% for the first project. Then monitor the project to see if you need to increase that estimate.

9. Insist that the outsourcing company keep the same team for your project's duration. Otherwise, the time you spent training their people is wasted and you'll have to start the training process again. 10. Make sure you have the tools, information systems and processes in placeto support the outsourced teams. They'll need access to the source code, defect tracking system, database or other platform applications, builds, etc. -- the same project tools that the internal teams need. 11. Verify that the people who said they'd be working on the project are the ones actually working on the project. U.S. firms have been using the bait-andswitch approach to contracting for years. Senior staff sell the project and then proceed to the next potential sucker -- er, client -- while new college grads and other underexperienced staff work on your project. Well, guess what? The nonU.S. outsourcing firms have learned the same technique. If you don't verify who's working on your project, your project could be the learning ground for their staff to build their resumes. If you don't already create project environments like this, do you know what you'll have to change to manage a successful outsourcing relationship? La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 78

www.efficaciapersonale.com But ... Outsourcing works because the work is now being completed under contract. If you treated your development staff as if they were under contract and avoided the poor management practices mentioned above, you might be able to keep the work in-house. Managers can't easily change the focus of the outsourcer's technical staff or change the technical staff's processes and practices. So if the outsourcing vendor has a working process for product development, you will receive the benefit of that process. And ... Any software project worth doing is worth funding appropriately, whether you fund it for internal or external development. Remember, the cost of outsourcing is higher than the actual project cost. Some of the intangible costs are increased training, giving away your product domain expertise and lowered morale. Of course ... If you choose commodity projects, projects where the technical staff doesn't have to learn a lot upfront about the project and the product, outsourcing can work for you. But if you're thinking of outsourcing all your technology, you're not making technology a differentiator in your business. I honestly don't see how a company that uses technology as a key piece of its business can stay competitive and outsource all its technology initiatives. Of course, if you have terrible management, outsourcing your management makes sense! If you have some legacy-product projects, or if the projects you need completed aren't core to your business, then it won't matter if you outsource them. Whatever your in-house staff could learn from the projects isn't enough to matter to your future success. Finally... Remember, every time you outsource a project, you're giving away part of your assets to the outsourcer, the intellectual capital that your technical staff learns every time they complete a project. Eventually, these outsourcers will know your business better than you do. And when that happens, the company's management and then the company won't be needed anymore. The outsourcers will take over your industry. If you need to bring down the cost of your projects, certainly consider outsourcing. Just remember that it's not a free lunch, and you will have significant start-up time, training investment and probably some delays on your initial projects while the outsourcers learn your business. And make sure to outsource commodity work, not work that advances the state of your business. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 79

www.efficaciapersonale.com Stacy Karacostas http://www.startupnation.com/business-articles/9754/1/outsourcing-stress-free.htm

10 Tips for Stress-Free Outsourcing

If youre like most entrepreneurs, you have far more to do than you can possibly ever get done. That means if you want to keep growing your business (or want more time for a personal life) you have to get some help. Thankfully, these days you dont have to spend the time and money hiring full-time, inhouse employees. Instead you can outsource specific projects or ongoing basis to any number of virtual service providers. This can be wonderfully effective as long as you know how to communicate your needs clearly. Because if you dont, youre going to end up spending far too much money and not getting what you needed when you needed it. To help you have a successful outsourcing experience, below is a list of 10 practical tips that make the process smooth and easy 1. Create how-to process documents and/or checklists for all recurring tasks in your business. Having everything documented makes it much easier to outsource those tasks virtually, or even hand them off to an employee or partner. The easiest way to do this is to create these as you do the tasks. The best part is, you only have to create these docs once, versus having to do the task yourself over and over again. 2. Always include a project title in your requests that is clear and descriptive. This makes it easy to keep your tasks organized at both ends. If you put New Task or something generic in the title or subject line the item can get lost. Plus youll waste time trying to find the right message again later. 3. Put your due date in the title or subject line, as well as in the body of the document. This is VERY important! Neglect this small detail and the chance of you getting your task completed on time goes way down. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 80

www.efficaciapersonale.com 4. Start any task request with a short overview of what youre trying to accomplish. If the person youre outsourcing to understands the big picture, its easier for them to do tasks correctly, make decisions, and offer suggestions. But keep it short. One or two sentences should do the trick. 5. Use bullets or numbered lists of steps. Never assume someone knows how you want things done. Detail out each step or specific task you need done in order to complete your project. 6. Send each task or project in a different email or request. Never submit two completely different projects in one request (or email) or you risk confusion and projects falling through the cracks. 7. Be an active project manager. Outsourcing doesnt mean that once you hand something off your job is completely done. Ultimately, youre responsible for making sure everything is taken care of as you requested. So review their work regularly and communicate any needed changes until tasks are done the way you want. 8. Specify a maximum number of hours or dollars. This keeps you from getting handed an unexpectedly large bill. 9. Set expectations about how and when you expect reports or updates. Always request a read receipt or reply when they receive a request and a message upon completion of a task or project. If your project is large, split it into parts or phases and ask for updates when each phase is complete. 10. Some things require a phone call. While its best to submit project and task requests in writing for tracking purposes, sometimes it helps to talk over the details. Remember, even though youre paying them to work for you its always good to say "please" and "thank you". And to compliment someone on a job well done. Its easy to feel impersonal when you work with folks virtually, and forget to let them know you appreciate their hard work.

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www.efficaciapersonale.com The bottom line isnever assume anything. And never write up project or task requests in a rush. Because the more detailed, specific and accurate you are, the happier youll be with the end result.


Nina Kaufman La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 82

www.efficaciapersonale.com http://www.startupnation.com/series/147/9497/outsourcing-makes-you-go-ouch.htm

When Outsourcing Makes You Go "Ouch!"


When does outsourcing make you go ouch!? When you receive a notice from the Department of Labor, assessing you penalties and interest for not paying payroll taxes for your employee. But no! you cry. This was an independent contractor! We had an agreement. Too bad, says the Department of Labor. Its not what you call the relationship its how we view it. Thats a tough lesson for entrepreneurs. Youre up to your eyeballs in paperwork. Youve only found 24 hours in each day. You need help. So you hire your next-door-neighbors kid, a recent college graduate, (thrilled to be earning some money, given dim job prospects) to help with bookkeeping. You make it clear that she needs to pay her own payroll taxes. She agrees, and is happy with the arrangement. The kid is free to take on other jobs, other assignments for other people. So why isnt she an independent contractor? It comes down to how controlling you are.

The main difference between an employee and an independent contractor is the degree of control you have over the worker. The more control you exert, the more likely your contractor will be seen as an employee. The government looks at three main categories: (1) behavioral control; (2) financial control; and (3) the relationship of the parties. Behavioral Control A business has behavioral control when it can direct or control how the work gets done. For example:

Do you give extensive instructions and training to the worker? Do you decide what the worker will do and when? Do you provide the equipment, supplies, or materials?

The more of these to which you answer "yes," the more likely it is that you are hiring an employee. In the situation with the neighbors kid, who came to your home to do your bookkeeping, you were likely doing all three. Financial Control To what extent are you controlling the business aspects of the work being done?

Has the worker made her own financial investment in her business? 83

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Does she have to pay for her own business expenses, such as rent and utilities, licensing or professional dues, or advertising expenses? Does the worker take a risk on the transaction by either realizing a profit or incurring a loss?

If the answer is "no" to these criteria, the scales again tip to the employee side. Once again, the neighbors kid, who doesnt have other clients, hasnt taken any financial risk, and doesnt pay business expenses, shows a lack of independent financial control. Your Business Relationship If it walks like a duck and swims like a duck . . . does it also quack like a duck? Whats your relationship with this worker? Does it sound like an employee-type relationship?

Do you provide benefits such as insurance, pension, or paid vacation? Do you have a written agreement suggesting that the worker is an employee? Do you make payments for the worker's services to an individual instead of a corporation?

With your neighbors kid, although youre not paying benefits of any kind, you are paying the fees to an individual, not a business entity. And that, plus the evaluation of the behavioral and financial control factors, makes it likely shell be considered an employee, not a contractor. Get Your Ducks in a Row Lets face it: the government wants the tax revenue that comes from treating workers as employees. And the penalties and fines for non-compliance can be stiff (not to mention, it gives the agency the right to nose around in your books for other violations). So when youre thinking about outsourcing, get your ducks in a row and choose your contractors carefully. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 84

www.efficaciapersonale.com Keith R. Crosley http://entrepreneurs.about.com/cs/beyondstartup/a/uc041003a.htm

Top 10 Tips for Outsourcing Success

Do What You Do Best and Hire the Rest


Entrepreneurs and small businesspeople are always looking for creative ways to accomplish more of their business goals for less money. One strategy that can help you save time, money and frustration as you start and build your business is to outsource as much work as possible to skilled, but cost-effective, external service providers. In my work with Elance Online -- an online marketplace that helps small businesses outsource almost any type of project Ive talked with dozens of buyers who have successfully outsourced projects as diverse as administrative support, business strategy, graphic design, web design and development, writing and even software development. When I talk to buyers whove mastered the art of effectively managing external service providers, the same themes emerge over and over. Ive distilled their advice into the following Top 10 Best Practices for working with external service providers. Following this advice can help you get the most out of your relationships with external vendors or contractors -- whether you use the web to find service providers or are requesting and evaluating quotes from vendors the old fashioned way. 1. Clearly define the scope and schedule for your project This might seem obvious, but any successful outsourced project always starts with a clear statement of what you are hoping to accomplish. 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. Be specific about the deliverables you expect the vendor provide. Give vendors as much information as you can about what you need delivered and the way in which you need the work done. Also, be clear and realistic about your schedule requirements - project schedules can have a huge impact on project costs. 2. Evaluate a service provider like youd hire a full-time employee When youre evaluating proposals from service providers, dont be afraid to ask questions. Just like hiring a full-time employee, selecting a vendor is a very subjective experience. Check their references and ask for feedback from other clients who have used their services. Engage in a dialog if you have any concerns about a vendors specific capabilities, voice your concerns. Dont just stew about it and hope for the best.

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www.efficaciapersonale.com 3. Look for specific experience fit Ideally, the service provider you select will have specific experience with the type of project that youre undertaking. You dont want to be somebodys guinea pig. This is especially crucial when outsourcing complex technical projects such as software development. For example, if youre looking for someone to develop an application for the Palm PDA, make sure theyve actually completed commercial projects on that platform for other satisfied customers. This advice holds true for other types of projects as well. If you need a business plan for opening a retail store, youll get best results if the consultant you hire has verifiable experience in the retail sector. 4. Dont choose a vendor based solely on price Though it might be tempting, never select a vendor based solely on price. Experienced buyers who have outsourced many projects and evaluated hundreds of proposals almost always recommend discarding the highest-priced and lowest-priced bid. Buyers report that their most successful projects are the ones where they felt the vendor offered a balance of good value and quality results. 5. Review portfolios and samples Examine the vendors previous work (their portfolio) and make sure that their previous work meets your expectations for quality and style. If youve evaluated a vendors 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. But never cross the line between asking for a mock-up and insisting that a vendor provide you with finished work on spec. No qualified professional expects to work for free. 6. Start small When engaging with a service provider for the first time, start with a project that is relatively small and simple in scope. This will give you a better idea of the providers style and capabilities before you entrust a mission critical project to them. 7. Tie payment to clearly defined project milestones Just as you should be clear about project scope, make sure that you 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 completionis an easy way to ensure that you meet your final deadline and that the final product meets your standards. Tie the vendors payment to these milestones. A good guideline for IT and software development projects is to pay no more than 20% to 30% of the total project price up front, with the rest of the payments awarded based on the completion of 3 or 4 milestones.

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www.efficaciapersonale.com 8. Negotiate ownership of work up front For any type of outsourced project, 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. For example, the development of a custom software application for your personal use would be substantially different from the development an application that you intend to package and re-sell. 9. Dont forget about support after the project is complete For technology projects, its a good idea to specify a warranty or support clause so that you are assured of some amount of continuing support from the vendor after the project is complete. Its much easer to negotiate a support clause before the service provider begins work, rather than after the completion of the project. Even creative or business services can benefit from a support clause. Suppose you need some changes to a business plan based on feedback that you get from potential investors. Or maybe you find that you need that snazzy new logo delivered in a new type of file format. Specifying some amount of free support or negotiating discounted prices for future modifications can save you time, money and headaches later on. 10. 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. Similarly, 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 fulltime 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. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 87

www.efficaciapersonale.com Amit Mullerpattan http://smallbiztrends.com/2009/02/top-10-outsourcing-trends-small-businesses.html

Top 10 Outsourcing Trends by Small Businesses


The expanding reach of the Internet and growth of online collaboration tools have all changed small business outsourcing dramatically in the past 3-4 years. Let us take a look at 10 key trends for using independent contractors for projects and even ongoing staffing needs, and how they shape up in 2009: 1. The Outsourcing Life is hip Popularized by the best seller The 4-Hour Workweek, more people are realizing that they can get their work done by someone else even if they are a solo entrepreneur. According to statistics published by US Small Business Administration, 56% of US small businesses with 100 employees or less, have fewer than 5 employees. If your business is one with no employees or a very small number of employees, you may find yourself over-stretched for time, and in need of outsourcing in both your personal and professional life. Driven by the economy and the need to watch expenses, more businesses will opt for contracting relationships and hold off hiring new employees as long as possible. Small businesses are also continuing to push the envelope on what can be outsourced. They are discovering elements that can be outsourced even in previously core activities. For example, an Australian small business we work with specializes in online marketing, but also uses multiple telemarketing providers to cross sell their product range to customers.

How to benefit from this trend:


Re-examine what you consider to be activities only you or your employees can do. If not the entire activity, can some parts of this at least be outsourced? Be prepared to invest some time up front in training your outsourcing partner.

2. Have we met? Not likely! Trusting people you never meet face to face is gaining acceptance. Use of Skype conversations and social networks like Facebook and Twitter exemplify how people who have never met strike up relationships with each other. These media are increasingly becoming the means for small businesses to reach out and establish trust based relationships with their outsourcing partners. A decade ago you may never have thought of outsourcing to someone outside of your local city or region. Now it is commonplace to find vendors and independent contractors across the country or even across the world.

How to benefit from this trend:


If you are a vendor, establish a presence on the networking sites of your choice LinkedIn, Facebook, Twitter etc. to create an online brand presence. Make it easy to be found and for customers to get to know you.

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www.efficaciapersonale.com Evaluate which mode of communication gives you the best results. Also take into consideration where your customers are located and how they prefer to be contacted. Sign up with Skype, or other email and Internet marketing tools.

3. More power for the hour new ways to price services Payment schedules structured to incentivize success are gaining popularity. Two common types of payment methods are Fixed Price (where the vendor takes much of the risk this is often highly conflict prone) and Time and Materials (this gives the vendor flexibility in defining scope but is expensive and asks the buyer to micro-manage). Were seeing pricing structures that combine the best of both. For example, web page design will be fixed at a price per page. Subsequent changes requested by the buyer are paid for using an hourly rate for the effort. The combination pricing can save the buyer as much as 30% of the total cost and avoid conflicts. It also aligns interests of the buyer and the vendor.

How to benefit from this trend:


Split your project into 2 parts: the part that is well defined and unlikely to change, and the part that needs to change as you see results of each phase. Fix Price the well defined part, while agreeing upon an hourly rate for the rest.

4. We need to talk In real estate the mantra is Location. Location. Location. In outsourcing the mantra is Communication. Communication. Communication. Operational structures that clearly define responsibilities and establishing ways of communicating play an ever more important role in successful outsourcing. Small businesses are realizing the importance of such rigor in defining operational structures. For instance, you might establish a regular review schedule to effectively manage a project and stay on top of progress. This is preferred over putting a project out for hire and then going weeks without any status update. Email, instant messaging and collaboration technologies make it easier to conduct frequent reviews.

How to benefit from this trend:


When you outsource a project, establish a routine of daily or weekly status review calls based on project size. The duration of the calls again depends on the nature of your project, but typically 1 hour or less works best. This is important especially when you are working with a new provider.

5. Taking the relationship to the next level - outsourcing ongoing processes Small businesses are opening up to outsourcing ongoing processes, in addition to projects. Task (or project) outsourcing (e.g., file my taxes) is primarily a one-off activity while process outsourcing (e.g., manage my accounting) requires a relationship approach. Process outsourcing also places greater responsibility on the vendor to become closely familiar with the clients business and the clients customers.

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How to benefit from this trend:


For the projects you are outsourcing, see if some of the activities you do before and after the project can also be done by your outsourcing partner. When outsourcing processes, evaluate providers for a strong understanding of the legal and regulatory issues associated with the process they would manage.

6. Jigsaw Puzzle Outsourcing Both clients and service providers are building the skills needed to successfully execute geographically distributed projects. Small businesses are getting more comfortable with working remotely with the most skilled professionals, irrespective of where they are located. The ability to break a process into components that can be done by different individuals, but designed to all fit together for the end result, is a complex skill that is increasingly valued.

How to benefit from this trend:


When outsourcing a project focus more on who can get the job done best. If other factors like location, cultural affinity, time difference etc. are concerns for you, share them with your outsourcing partner. Discuss how the risks that come with these factors can be mitigated and find a solution that both parties feel is fair to them.

7. Lets collaborate! Tools like Basecamp, Zoho and Google Docs enable collaboration across continents cheaply. You no longer have to worry as much about whether the client or the service provider have the same software applications installed, and in what form you are going to deliver work. Online apps that are universally available make exchanges of information, project updates and deliverables easy and seamless. PayPal has changed the face of payment. PayPal is available in 190 markets and 18 currencies around the world. Small businesses are using PayPal to invoice, make and receive payments. Skype, an Internet based telecommunications and messaging system, likewise has made telephone conversations and quick message exchanges easy and inexpensive to do.

How to benefit from this trend:


Decide what collaboration tools you need, and pick the one that best fits your needs, and does not confuse you with too many bells and whistles. Coach your outsourcing partner on how to use the tool most effectively, if required.

8. Pushing the frontiers of complexity Services that are critical and complex like legal services, management accounting, and employment training are being increasingly outsourced globally. In part this is due to point #2 above, where we are increasingly becoming more comfortable dealing across the web with people we have never met. This trend will require providers, too, to become more skilled and efficient in handling greater complexity.

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How to benefit from this trend:


Take a second look at specialized services that are the most expensive in your business these are areas you might consider outsourcing. Start small, and send out chunks of it to lower cost providers who can do the simpler components of the task for less. Expand the relationship as both sides become more confident in handling the additional complexity.

9. Offshore or Homeshore? The choice is yours! Small businesses are maturing to look at a variety of factors before making the outsourcing decision. Tasks that require presence in the same time zone and a cultural awareness are being Homeshored. Tasks that are not time sensitive or heavily influenced by culture are being Offshored.

How to benefit from this trend:


Evaluate if your outsourcing partners can train themselves on some of the cultural aspects if they belong to a different geography. Offshore only those tasks that are well defined. For tasks that need your input several times a day, choose a provider who can work in your own time zone.

10. Just tell me when it is done! Small businesses appreciate vendors who can support them through the project execution process. Small businesses are increasingly realizing that bringing clarity to tasks, defining milestones and timelines, tracking progress etc. play a pivotal role in project success. Were seeing the emergence of more agencies and firms that place outsourced talent and handle all the overhead for the client. These services are increasingly sought and valued by small businesses. Almost every client we have tells us that the service we provide in managing their outsourcing is what they value most.

How to benefit from this trend:


Evaluate how much time you and your employees are ending up spending on finding providers and on assigning and tracking their tasks. This could be another service you could outsource to an outside agency. Look for strong communication skills and experience in setting up processes that produce results.

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www.efficaciapersonale.com Richard White http://smallbiztrends.com/2013/03/why-when-what-how-outsource.html

Why, When, What and How to Outsource Tasks


Is it a good idea for a small business to outsource some tasks? Contrary to what many small business entrepreneurs think, it is often a great idea to outsource certain tasks to others. But, before you make any decisions to outsource, here are a few things you need to think about. Why, When, What and How to Outsource Tasks

Why Outsource Tasks?


You may have the talent to do it all. However, if you indeed do it all, it may become difficult to achieve the ultimate objective to enhance the prospects of your business. While you may be able to handle everything on your own, you may not be able to focus on the more essential elements of the business. It is possible to streamline your business if you outsource certain tasks to vendors. By doing this, you will be able to concentrate on the core areas of your business. The first step may be a little difficult, however, in the long run it will lead to an increase in efficiency. Another advantage is the cost-effectiveness of outsourcing. When you decide to outsource specific tasks to others, you need not employ a large number of people or buy or rent office space to accommodate them. This can considerably reduce the burden of overhead and cut business costs. Advanced technology has made it easier to appoint professionals from any part of the world for specific tasks. The availability of highly skilled freelancers combined with the accessibility of their services enhances the suitability of the option to outsource.

When to Outsource Tasks


For small businesses, outsourcing can be advantageous from the beginning. When you start a business, you need to make sure that you do not lose your focus. In such circumstances, if you have to handle tasks such as attending to calls or bookkeeping, you may not be able to do justice to the more important tasks at hand. There is no right time for a business to outsource. The way your business works, the staff members you have and the tasks they need to handle daily play a significant role in the decision about when to outsource. While a very small business can capitalize on the advantages of outsourcing from the very beginning, a medium-sized business may not need to outsource daily tasks considering this option only if they cannot handle new projects on their own. However, this may only be appropriate if appointing a full-time employee is not justified.

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www.efficaciapersonale.com If you feel that you are the only one who can manage everything efficiently, but do not find adequate time for the most important tasks of your business, it may be the right time to let go of your complete control over certain tasks and outsource them.

What Tasks to Outsource?


The first thing is to identify the core areas of your business. Any tasks directly associated with these areas must not be in the list of tasks to be outsourced. If the core business areas are outsourced, your clients may not be able to get anything unique from you a mistake a small business cannot afford to make. For example, a web design business must refrain from using third-party providers for any tasks related to web designing, the focal point of the business. However, the business can outsource tasks such as payroll management or inventory management to contractors. The common tasks that small businesses may choose to outsource include the following:

Repetitive tasks: Data entry is a good example of a highly repetitive task. While you may use your in-house staff for this, it may be a better idea to outsource this and employ the in-house staff for more useful work. Specialized tasks: IT support can be the right example of this type of task. While you may need IT support for your network, you may not need to appoint a full-time employee for this purpose. In such a situation, a contractor may be ideal for this specialized work. Expert tasks: Financial analyst is a good example of a position requiring a high level of expertise, but that you can still easily outsource. It may be difficult for a small business to pay for highly-skilled executives. However, you can appoint a financial analyst on a contractual basis at a much lower cost.

How to Outsource Tasks


After you have decided when and what to outsource, the next job is to find the right partner. The best way to do this is to get recommendations from your business associates and contacts. You may also find a number of contractors from online platforms dedicated to connecting businesses with outsourcing partners. Finding the right partner is all about understanding whether your requirements correspond to their specializations. After you have selected a contractor to outsource to, the next task is to draft a contract to specify every detail of the outsourced tasks. The best way to ensure that the partnership works out is to be clear about everything. Because you are the one providing instructions, you may be the one to blame in case of any misunderstanding. To ensure proper communication between your business and your outsourcing partner, it is best not to leave anything to assumptions. Keep in mind that the contractors you appoint may need some time to adjust to your work processes. Also, keep away from micromanagement as it may hinder your outsourcing efforts. The entire idea of outsourcing is to save time and focus on the core aspects of your business. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 93

www.efficaciapersonale.com AMY REININK http://www.entrepreneur.com/article/206226

When to Outsource

5 tips for calculating the cost versus the benefit of contracting key business functions
Michele Hanson-O'Reggio calls it the "lone ranger" mind-set: the tendency of small-business owners to assume they can and should handle all business functions in-house rather than pay to outsource those functions. But Hanson-O'Reggio, founder of the small-business outsourcing and consulting firm Biz Success Partner, is one of many outsourcing and productivity experts to say that outsourcing, once seen as the sole purview of large corporations moving offices offshore, can save even the smallest businesses time and money. In fact, Hanson-O'Reggio recommends entrepreneurs outsource non-essential functions almost immediately upon launching a business to let them focus on the functions they specialize in. "The expected return is greater than the investment," she says. She and other outsourcing experts offer the following tips for determining the expected return for your business. 1. Consider the overhead and non-productive hours. The first layer of cost savings in outsourcing comes from payroll taxes, insurance and benefits paid to fulltime employees. Mark Loschiavo, executive director of Drexel University's Baiada Center for Entrepreneurship, says entrepreneurs should expect to pay roughly 30 percent of an employee's salary in addition to the salary itself for these overhead costs. Lunch breaks, doctor appointments and other gaps in working hours bring the actual cost of a full-time employee to nearly double his or her base salary, says HansonO'Reggio. Hanson-O'Reggio also says it's important to consider the financial gains associated with spending time netting new clients rather than doing the bookkeeping or replying to e-mails. 2. Know your worth and use that knowledge to determine when it's worthwhile to hire someone else. Hanson-O'Reggio says solo entrepreneurs can compute cost savings for outsourcing certain tasks by comparing their hourly rates to the hourly rate of a contractor. For example, a business coach who makes $100 per hour can save $75 per hour by paying a virtual assistant $25 per hour to handle administrative tasks--and that's not accounting for the fact that it may take the virtual assistant half an hour to complete a task that would take the coach an hour. That equation also doesn't account for increased quality that comes from "finding someone who can do a given business function better than you can," says smallbusiness consultant Marc Resnick. 3. Think beyond the basics. Increasingly, owners of small businesses in a wide variety of fields are outsourcing executive-level positions such as chief financial officer and chief marketing officer, seeking overall strategy solutions rather than La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 94

www.efficaciapersonale.com single functions such as bookkeeping or graphic design. Entrepreneur David Walsh, author of Source Control, an e-book on effective outsourcing for small businesses, says entrepreneurs are learning that "outsourcing your CFO might mean a light monthly retainer with a retired CFO in the Midwest, or that outsourcing your legal might mean a bi-weekly teleconference with an attorney you couldn't possibly afford to hire full-time." 4. Experts say the CFO position is especially ripe for outsourcing, as many entrepreneurs don't feel comfortable handling high-level financials on their own. Paul R. Shackford, founder of B2B CFO, which provides part--time CFO services to businesses nationwide, says entrepreneurs often come to his firm when they find they can't answer banks' questions about issues such as cash flow projections or covenants. Shackford says outsourcing a CFO position can save an entrepreneur 20 percent to 30 percent compared with a full-time employee. John Gillespie, founder and president of Beyond the Bottom Line, a financial consulting firm that outsources financial services, offers the following calculation, which considers the fact that most small companies need a CFO's services, but might not need those services 40 hours per week: A full-time CFO with a base salary of $175,000, plus an additional 25 percent for taxes and benefits, would cost $218,750 per year, or $18,229 per month. But he says most small companies might only need a CFO's services for one day per week, at an estimated cost of at $6,400--a 65 percent savings. The trend isn't limited to CFOs. Adam Atwood, principal of Kilman Atwood, which provides marketing strategy services to small businesses, says entrepreneurs can save anywhere from 40 percent to 60 percent by outsourcing the chief marketing officer position. "It's an easy pitch when you can tell a business with $15 million to $20 million in revenue that instead of hiring a CMO for $150,000 a year plus benefits, they can pay about half that by outsourcing the position," Atwood says. 5. Get personal. Cost savings vary greatly from one small business to another, so many contractors provide free online calculators to help entrepreneurs determine how much they'll save by outsourcing. For example, a calculator offered by Business Network Consulting, a Denver-based IT consulting firm, shows that a company with 10 employees that needs a "modest amount" of IT help and has a single 1-year-old server could save more than $6,000 annually by outsourcing IT functions. "Your potential cost savings are totally tied to the type of industry you're in and the complexity of what you're trying to do," says Joe Kelly, CEO of BNC. "If you're a 100user company that only needs file sharing and e-mail, you may have the same costs as a 10-person company that offers financial advice and needs a redundant site and a lot of support." 6. Weigh the costs and benefits of offshoring. Advances in technology make it easy for even small businesses to connect with offshore programmers and they're likely to realize cost savings by doing so, says Steve Mezak, CEO of Accelerance, which connects small companies with teams of contract programmers worldwide. But Mezak says offshore contractors may require more time to manage thanks to differences in time zones, language and culture. Entrepreneurs might consider rural stateside contractors instead, capitalizing on the fact that a contractor in Maine or South Dakota is likely cheaper than a similarly qualified professional in Manhattan-and that any team of contractors is likely to be cheaper than a team of full-time La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 95

www.efficaciapersonale.com employees. He says a programming project could cost $50,000 to $100,000 if farmed out to a team of contractors offshore, or about $100,000 to $200,000 to hire a team of contractors stateside, compared with literally millions of dollars to hire a team of similarly qualified contractors as full-time employees.

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www.efficaciapersonale.com Business Matters http://www.bmmagazine.co.uk/in-business/advice/11068/top-tips-outsourcing/

6 top tips on growing your business with outsourcing


Daniel Callaghan is the founder and CEO of MBAandCo.com the global marketplace of top tier freelancers with at least five years experience and postgraduate degrees from top business schools. Here, he give Business Matters his top tips on outsourcing. 1. Envisage the benefits If your business is lacking in-house expertise, hiring a consultant with those missing skills, to complete projects or train up the team, is a positive step. For instance, those who want to initiate social media marketing for their business, but have no clue how to go about it, can outsource the work to an expert to ensure they do not waste precious time on efforts that may not yield results. If the outsourced project will help, rather than hinder day-to-day operations, then it is worth the cost. Of course, some outsourced projects, such as lead generation, will allow business owners to see the return on investment even more clearly. 2. Consider freelancers Freelancers typically work remotely and do not have the overheads of an agency or consultancy firm. This means small businesses can get the same project completed at a much lower cost often making savings of up to 50%. Selecting candidates from a freelance talent pool also means the choice for businesses is far more wide-ranging than having to use the employees of a specific agency or consultancy. This is particularly good for business owners with more specialised projects. 3. Write a detailed project brief The more detailed your project brief, the more likely you are to find a match with a consultant with the relevant skills. Consultants skills are hugely wide-ranging. Whilst a management consultancy or market research project could be outsourced to most business consultants, it might be that you need someone who specialises in East Asian markets and is based on the ground in Hong Kong, or an HR expert with experience in handling sensitive internal disputes. If its a niche project that needs completing, specify what sort of candidate you would prefer to undertake the work and what previous experience or skills are musthaves. This should make the selection process simpler as it will deter those without relevant experience from applying. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 97

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4. Choose carefully If you outsource project work, the person you choose will be representing your brand so it is your prerogative to be selective. Ask for references as well as a CV and examples of previous work if necessary. As some consultants will need to go under the bonnet ask them to sign a non-disclosure agreement. 5. Be open-minded It can be hard to accept criticism, however constructive. But the impartial and objective perspective of a consultant can prevent business owners from making the wrong decisions, and is therefore hugely advantageous. Often the company management tends to be biased towards a particular viewpoint and may fail to see the risks associated with that course of action. For instance, they may be so pleased with a new product development that they may be blinded to the non-existence of a market for that product. Read the results of the outsourced project with eyes wide open. 6. Try before you buy More and more we are seeing businesses use our website as a try before you buy approach to recruitment. In the current climate particularly, every hire is a risk and most small business owners will tell you that recruiting the right people is one of the hardest things to get right. Outsourcing a project allows business owners to vet work, and professionalism, without the need for a staff contract.

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LAURA TIFFANY http://www.entrepreneur.com/article/187064

5 Out-of- the-Ordinary Outsourcing Trends


Outsourcing is reaching new levels of creativity as entrepreneurs figure out more tasks that can be sourced elsewhere. Outsourcing exists on a fairly simple premise: If you can do something, there must be someone else out there capable of performing that same task--only cheaper. With VoIP and the internet, almost anything can be outsourced with some time and consideration. We've found five unusual trends in outsourcing, all of which are likely to become the norm. Outsourcing is poised to grow exponentially as more entrepreneurial minds check out the tasks on the world's to-do list and figure out who can best provide those services for the least amount of money. 1. Getting personal. Outsourcing usually brings to mind business tasks, whether that means customer-service calls offshored to India or data-entry work farmed out to a virtual assistant. But why leave it at that? Why not outsource the design of your personal website, the building of your deck or reservations for your vacation? DoMyStuff.com is a stateside service that allows people to put their tasks up for bid-anything from raking leaves to installing software. "Right now, this idea is really in its infancy," says David Davin, COO and co-founder of DoMyStuff. "But this is where the internet has been heading all along. We all have specialized skills. The internet brings us to one place where we can exchange those skills." The p-to-p offshoring industry is just beginning, but research firm Evalueserve predicts that by 2015, consumer and small-business offshored services will grow to more than $2 billion, from only $250 million in 2006. 2. Outsourcing the outsourcing. With success comes competition. While India is synonymous with outsourcing, it's also facing competition from other nations looking for a piece of the pie. India's economy is in an upswing, and wages are rising quickly. According to a report by Gartner, Indian software engineers will be earning 40 to 50 percent of Silicon Valley wages next year, and the difference will continue to diminish, as will the savings American companies get from outsourcing. At the same time, other countries are looking to India as a model of economic growth. A recent trade event in New York City, OutsourceWorld, boasted representatives from nations as diverse as Mauritius, Costa Rica, Canada, Malaysia, Romania, Malta and the Ukraine. Indian outsourcing firms are preemptively opening offices all over the world to compete. Infosys, a $3.1 billion leading provider of outsourced services, has 75,000 employees in India, but also has offices in several countries, including Mexico, the Czech Republic, Thailand, China, Poland and the Philippines. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 99

www.efficaciapersonale.com It's quite likely that the next time you outsource a task to India, the person actually completing that work may live in another country--and you'll probably never realize it. 3. Tutoring a world away. Tutoring can be expensive, but parents will pay to help get their kids into the best college--a goal that's fueling the $4.5 billion tutoring industry at a 12to 15-percent growth rate, according to Eduventures, an education research firm. But not all parents can afford the hourly rates at centers like Sylvan. So they're turning to services likeTutorVista, an online tutoring service based in Bangalore, India. Founded by Krishnan Ganesh, the service offers a $99 per month flat rate for tutoring; kids communicate with their Indian tutors via voice chat, IM and a digital tablet. Ganesh has received $15 million in venture funding and hired U.S. tutoring industry vet John Stuppy-Sylvan, The Princeton Review and Educational Testing Service--as his company's president. As of September, TutorVista had attracted 10,000 subscribers in the U.S. alone and was planning on doubling its staff of 600 tutors. 4. Automating the drive-thru. When you place your burger order at a drive-thru speaker, you expect that the person taking your order will also be taking your money at the window in about 30 seconds. Not so with Exit 41's solution. To speed things up, the company has call-center employees take orders using VoIP; the orders are then sent real-time to a monitor in the kitchen so that in the few seconds it takes you to reach the window, your steaming food is awaiting your arrival. In Lexington, Kentucky, a Wendy's master franchisee has installed the system in 16 stores and acts as a call center for other Wendy's franchises on the East Coast. One high-volume store has shaved off five seconds from order time and doubled its capacity by adding a second drive-thru lane. Joe Gagnon, CEO of the Andover, Massachusetts-based firm, says he believes Exit 41's solution will become more common. Not only does it help increase drive-thru capacity, but it also allows for the use of operators in less-expensive areas--for example, a state with a lower minimum wage or even Mexico. 5. Power from the people. Crowdsourcing takes a task and unleashes it to the world. Think Wikipedia, the by-popular-vote T-shirt designs on Threadless.com, or Amazon's Mechanical Turk service, in which people take on fairly simple chores, such as summarizing a paragraph of text, for pennies a task. Google cleverly crowdsourced image tagging by turning it into a game, bypassing the need to pay for the task. "Most of the successful crowdsourcing models are very much like Wikipedia in that they have a really vibrant community that has sprung up that enthusiastically, passionately pursues this as a hobby," says Jeff Howe, the Wired magazine contributing editor who coined the term in a 2006 article. "It's not like there's a crowd ready to do any old work. It has to be something that makes them happy." La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 100

www.efficaciapersonale.com Marty Pine http://outsourcing.about.com/od/pitfalls/a/The-Pitfalls-Of-Outsourcing.htm

Outsourcing Pitfalls
What is it about outsourcing that encourages odd, self-defeating behavior? Why is it that people in this field often first need to be burned before they become willing to invest the time and energy required to get it right? Here, in ascending order of magnitude, are the reasons why new outsourcing customers get burned.
IT outsourcing is now well into its third decade, having passed through generations of technology and platforms: mainframe, client/server, and now into the cloud. An extraordinary amount of experience has created substantial documented learning that should benefit any company considering outsourcing some or all of its IT and network infrastructure, technology helpdesk or application development and maintenance. Yet companies frequently ignore the lessons of the past, and routinely duplicate the mistakes of our "outsourcing forefathers". What is it about outsourcing that encourages such odd, selfdefeating behavior? Why is it that people in this field often first need to be burned before they become willing to invest the time and energy required to get it right? Here, in ascending order of magnitude, are the reasons why new outsourcing customers get burned. Pitfall Number 5: How hard could it be? Outsourcing is not something that requires an advanced degree. We have been executing the IT Function for years now, and it's time to have another company do it for us. We know what we need. We have hardware, network, software (home-grown and licensed) and some knowledge as to how it all fits together for our enterprise. The likely providers - IBM, HP, Accenture, CSC, Infosys, TCS, And so on - generally have more competence in the area than we have. We have procured services many times before - this is just another service. And this time it involves our no longer doing something we were historically doing (and probably badly at that). What's the big deal? Those of us who have spent 20 or so years in the field know that this approach guarantees problems. Outsourcing is harder than you think. You can't just lop off a process or function and expect it to run any better than it did. First, you must decide why you are going to outsource. If it is because you are not good at IT yourself, or you think someone can do it cheaper, please see the other pitfalls! Then, even if outsourcing is right for you, there is a great deal of knowledge that your own staff has about the function, how it relates to your business, and how to manage it as your business needs change. This knowledge has to get to the outsourcing provider. It must be maintained and nurtured during the multiple years of the term. It must be available to you if you ever want to bring the function back inside. And, speaking of that, do you think it would be easy to bring the function back inside? What about new staff? What about technology refreshment? What about software licenses? And how do you handle risks associated with La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 101

www.efficaciapersonale.com data security and privacy compliance, once the IT function has been shifted to another company? There is a reason that successful deals take a substantial amount of time to negotiate and transition. Nothing about this business is easy. Pitfall Number 4: The outsourcing provider will fix everything In outsourcing, we get to transfer our IT problem to a provider who has expertise in the area. They will fix the problem and save us a ton of money. And the best thing is: we won't have to change the way we do things. This concept is so familiar to outsourcing professionals that it has a name, "Your mess for less". And outsourcing professionals know that it is not the way to get the deal done. IT outsourcing providers cannot resolve your problems without your involvement and willingness to change the way you do business. And although they are generally better at the given function than you are, the way they solve your particular problem, the solution they bring to the table, will by its very nature change the way you do business. Better than doing a "mess for less" is to put in some time and energy up front to understand the reasons for the mess, and to begin a process of remediation before you outsource. Most firms that have migrated their IT platform to a shared services model before outsourcing any function to a third party have found that the likelihood of a successful IT outsourcing relationship is substantially increased. Pitfall Number 3: What do you mean "the baseline?" We are not sure what we spend on this function to be outsourced, our metrics on transaction volumes are not that great, and we don't really collect performance data about how well we do it ourselves (or, we do collect performance data and there are about 150 things we measure). We know that we want improvement and cost saving, and the provider will agree to do just that. The smart provider will do nothing of the kind. The failure to provide a legitimate baseline from which to judge improvements in cost and performance during the deal's term is one of the main reasons why outsourcing relationships break down. Efforts to pin down this information are usually short-circuited and made hostage to the need to get a deal done quickly. Development of an accurate baseline for defining and pricing the so-called "in-scope" functions or people is not as easy as it sounds. Often, people function in several roles - sometimes in scope and sometimes out of scope. Some underlying costs are contained in budgets other than the IT one, and may continue despite the effort to realize cost savings. Much may be left for post-contractual analysis and adjustment in pricing, scope or service levels. By then, unless the contract has been carefully negotiated, it may be too late. Both sides may realize that the customer's objectives just cannot be met at the proposed pricing. This leads to bad behavior by both the parties as they try to jockey around a deal that should not have been made in the first place. Pitfall Number 2: Its only about money We need to get cost savings next year. We understand that outsourcing is a way to get cost savings because the provider has a competency that we dont have. If we get the savings, we will be satisfied. Cost saving is important it is still the number one reason that companies engage in outsourcing. But money isnt everything. Deals that are struck purely La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 102

www.efficaciapersonale.com for cost savings run into problems midway even if the savings are achieved. Thats because savings calculated against a baseline are really static. Outsourcing deals need to deliver dynamic benefits to stay relevant to changing organizations. For example, consider an application development and maintenance outsourcing based on the premise that the work will be done in India and will result in substantial savings due to labor arbitrage. The savings should materialize if the transition is done correctly, if the work is done with the same level of competence, and if overhead is not created by doing things half a world away. But, over three to five years, increases in rates and personnel turnover can more than offset some of these early benefits. And the flexibility to shift some of these workers to new applications may not be as great as it was when they were your employees. Pitfall Number 1: We can easily manage this relationship Once the outsourcing contract is signed and the responsibility and risk are shifted to the provider, we have very little to do. A person can manage this relationship, meet with the provider occasionally, and review performance, cost and other information as required. One of the benefits of outsourcing is that we no longer need be involved in this function. This is the biggest reason why first-time outsourcers go wrong. Outsourcing does eliminate work. But it also creates work. And, just as importantly, the management of an outsourcing relationship requires different skills than the management of the individuals that had been performing the function. The people in your IT department may not have the skill sets to do the job. A retained organization must be created to focus on relationship management, change control, and contract management in connection with the outsourcing. This may actually add personnel to the deal, and experts have estimated that six to 10 per cent of the cost of an outsourcing deal should be allocated for this purpose. If you are not going to pay attention to managing the deal and constantly assuring it makes sense for your company, you will get burned. And should your most experienced and knowledgeable people stay with your company or should they move to the outsourcer? Which of you has more need to tap that intimate knowledge of your business developed over many years? These are the top five, and as with any list of this type, there are plenty more where they came from. If you or your company is new to outsourcing, contact those advisers who can lead you through the process, and join and participate in industry groups dedicated to advancing the understanding of outsourcing, such as the International Association of Outsourcing Professionals, the Outsourcing Institute and the Sourcing Interests Group. Instead of putting yourself through the wringer, learn from your peers who have themselves suffered such indignities, and improve your chances of a successful first-time IT outsourcing deal. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 103

www.efficaciapersonale.com Chris Niccolls http://outsourcing.about.com/od/rfp/a/Can-Outsourcing-Be-Shoreless.htm

Can Outsourcing be Shoreless?


Genpact, a very large outsourcing company, recently raised a question about outsourcing. Should we forget about what shore the work is performed on? Should the locations no longer matter, and instead should we think about outsourcing as shoreless? Its an interesting question. Has outsourcing advanced beyond the point where location no longer matters? Lets take a look today and see what when location does and does not matter! Outsourcing has definitely changed, especially for the larger outsourcers. A global outsourcing firm can create just about any sort of business function you need, wherever you need it. However, there are limits to what even the most advanced, global organization can do. These limits may not mean that you shouldnt outsource, but they may mean that the location is the real selling point. Here are six of the most important features to consider about a location. LANGUAGE: A top-tier outsourcer can overcome the annoying issues English language mastery and accent that are stereotypical with outsourcing. It takes a real organization to build language skills, and you should be able to see and measure the capabilities of your outsourcer. Top tier organizations have native English speakers, or at least individuals who genuinely sound like Americans, the English, Canadians or which ever accent they are tying to replicate. However, if the head of the program and all the trainers have a strong accent, so too will your team. But what if your language issue isnt English? Almost all outsourcing has been based on English language outsourcing, in former UK colonies (including Canada and South Africa). When you begin work on your 2nd or 3rd generation outsourcing contract, you may want to finally outsource that little piece of German, or Japanese, or French work that you deal with. Unless your outsourcer has operations where these are native languages, other language outsourcing to India or China or other popular locations has rarely been successful. Perhaps blended shores may work, but that is not shoreless. EDUCATION: A world-class outsourcer should have a training group the size of a small university. Outsourcing of complex business processes and knowledge work always involves substitution. This means that if you have a position in financial research, the offshore location you use does not have a university that teaches financial research, but it does teach other forms of research that covers 75% of the job responsibilities. The job of the outsourcer is to learn the remaining skills and transfer them to their workers. If the positions you are outsourcing tends to hire straight out of school and then develops their skills within your firm, you probably have it well documented. However, if you hire individuals with 5 or 10 years of experience, and then give them additional training, you will not have any documentation on how they developed their fundamental skills before you hired them. An outsourcer can still develop these skills, but it La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 104 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com will greatly increase development time and requires much better retention of staff (so that workers will remain on staff when they reach the "senior" stage). Because of differences in local skills, and the time it takes to train workers to this level, locations may differ by YEARS in the time it takes for a center to be up and running. RETENTION: India, as an example, has a notoriously high attrition rate. Lets compare two different locations, lets say Mumbai, India vs. Manila, Philippines, that otherwise were comparable but neither location had a history of providing the particular service you were interested in. It might take several years in either location to get your fresh out of college recruits to become senior-level researchers (or analysts, or designers, or whatever). While the rates in India tend to be 10-20% lower, their attrition rate is double that of the Philippines. The initial plan will make the Philippines look more expensive, but the plan for Mumbai needs to have a very costly program (what?) to cut the attrition rate in half so that enough of your original staff stays long enough to become senior workers, and then stays in that senior position long enough to be with the investment. WORK HOURS: In any country, you have the greatest choice of workers during the 9-5 period, and the least after midnight and on the weekends. Thats a pretty consistent rule in any country. Outsourcing night -time work to India and Asia can be phenomenally successful because you are placing their strongest shifts against your weakest shift. When you change to receiving day-time (real-time) support, management issues rise and quality suffers. Outside of big cities in the US and Western Europe, few places around the world have night shift cultures. True, a high quality offshore vendor can provide a 24 x 7 cafeteria, but you cannot go out to a local coffee shop if you want to and in most offshore outsourcing locations, there is a stigma when the mother or father is not present for family meals and activities. If you are a woman, there can be a terrible stigma to having a night time job. The location of the work, and local customs, greatly impact how you work and how you retain workers. NATURE: All the previous issues can be significantly mitigated by the actions of the outsourcing center. But even the best outsourcer cannot control the weather. Big outsourcers have good back-up generators, to deal with the frequent blackouts in most offshore locations. Even if your vendor can provide infinite electric generating capacity, in a blackout electric trains do not run, traffic lights do not work and it is very challenging to find a way back to the office. If you try to call the office, cell towers and infrastructure may have failed, leaving managers wondering which staff members will be available. When monsoons arrive in India, or ice storms hit a mid-west center or a flood takes out power lines or a Tsunami is headed towards your workers, you will truly understand the importance of choosing the right location. STABILITY: The weather changes, but so too does politics. Changes in political stability can mean anything from a dramatic change in taxes, to a period of dangerous political protests, to sabre rattling between the country that houses your services and a neighboring state. Depending on the degree of instability (up to and including war), the cost of La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 105

www.efficaciapersonale.com continuing to work on that shore can change dramatically. Or make the location completely unfeasible. These are just six elements to consider when comparing one shore to another. Some elements (such as education) can be heavily impacted by the capabilities and investment of the offshore vendor, but other elements (such as the weather or the work hours) are less amenable to vendor modification. While we cannot be shoreless, a good vendor with multiple locations can blend together different locations to create a comprehensive MultiShoresolution, but this will have a premium cost. Just as a highly skilled distiller can combine different batches of good whiskey into an even better blended whiskey, so too can the skilled outsourcer make a blend that is more than the sum of the parts. Just remember, though, that you can only make a great blend if you are intimately aware of what each individual element will contribute to the whole! La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 106

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Tom Peters, Management guru http://www.outsource2india.com/why_outsource/articles/benefit_outsourcing.asp

The Benefits of Outsourcing


Outsourcing as an idea is not novice; it has been for over a thousand years now, the only difference being that it's gaining lot more popularity since a decade for whatever reasons. Outsourcing basically means asking a third-party vendor to work for you on a contractual basis. Companies outsource primarily to cut costs. But today, it is not only about cutting cost but also about reaping the benefits of strategic outsourcing such as accessing skilled expertise, reducing overhead, flexible staffing, and increasing efficiency, reducing turnaround time and eventually generating more profit. Like any other business venture proper planning and research is necessary before choosing an outsourcing partner whether it is on shore or offshore. But by outsourcing to a third party, your business can focus on what it does best and gain a competitive edge in the marketplace. Here are the top ten benefits of outsourcing: 1. Get access to skilled expertise One of the primary reasons why a business may want to outsource a task is when it requires skilled expertise. This skill set may not be a core competency of its business. To allow you to focus on your core mission in providing a high quality product and service to your customer what makes sense is offshoring the task to people can perform it better. Moreover, as a double whammy, you not only spend less on employee trainings and save precious man-hours but cut costs as well. Outsource2india has dedicated teams to provide wide range of outsourcing services, which help us offer specialized business process outsourcing solutions to clients globally. We leverage on our multi-domain expertise and skills across variegated industry verticals and technologies to achieve superior quality and unmatched proficiency in the outsourced process. 2. Focus on core activities La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 107

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Workload increases with additional non-core functions and the quality of your core activities suffers as your business grows. Outsourcing in such scenario to a third party plays an important role by allowing your key resources to focus on primary business tasks. 3. Better Risk Management Outsourcing will allow you to share any associated risks with your outsourcing partners there by reducing your burden. For example - by outsourcing to a competent outsourcing partner you reduce the risk involved in having the same task done in-house by staff that may not be as competent in that field. 4. Increasing in-house efficiency After you allocate tasks to your outsourcing partner, they share the workload of your employees. This allows you to develop your internal task force and use them more efficiently. 5. Run your business 24X7 Offshore outsourcing to a country like India, which is on a different time zone, gives you the added advantage of making full use of your 24 hour day. Since your night is their day, your outsourcing partner can take over and continue your work even after your employees go home and to bed. They can complete critical tasks and send it back for your review the next day. So the benefit of outsourcing here is that you get more work done in a day, increasing your overall productivity. A 24X7 customer support is a dream come true for your customers and this can be fully realized through offshore outsourcing. 6. Staffing Flexibility Outsourcing certain independent tasks, allows your business to maintain a financial flexibility when there is an uncertainty in demand. You can scale up or down comfortably. At a much lower cost, offshore outsourcing provides additional benefit of running your business in full throttle even during off season and holiday months. 7. Improve service and delight the customer Your outsourcing partner, with their skilled expertise will produce quality deliverables faster, increasing your turn around time to the customer. With on-time deliveries and high-quality services your customers will be delighted! Outsourcing can help you benefit from increased customer satisfaction and thus creating a stream of loyal customers. 8. Cut costs and save BIG! La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 108

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All the benefits listed above come with the bonus benefit of lower cost and big savings! When you outsource services like medical billing, call center and teleradiology, etc. to a low-cost country like India or Philippines, you are getting access to quality services that are offered at a much lower cost (You can save up to 60% costs)! Maintaining an infrastructure can be an extra burden for some businesses, which outsourcing can remove. Outsourcing your business requirements to a trusted vendor can help you save on the capital expenditure, time, and extra efforts of your personnel. Additionally, you are no longer committed to invest on employee training, or purchasing expensive software, or investing in latest technologies. All this add up to higher returns in the longer run. 9. Give your business a competitive edge The ultimate benefit of outsourcing is that it helps your organization gain a competitive edge in the market. Through strategic outsourcing to an outsourcing partner, you are not only providing your customers with best-of breed services, but increasing your productivity while managing your in-house resources intelligently. Outsourcing can help you surpass competitors who have not yet realized the benefits of outsourcing. 10. See an overall increase in your business Outsourcing shows an increase in your productivity, customer loyalty. level of quality, business value, profits, and much more. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 109

www.efficaciapersonale.com Outsource2india http://www.outsource2india.com/why_outsource/articles/5_w_of_outsourcing.asp

The 5Ws of Outsourcing


If your organization is new to outsourcing, you might be confused about why should I outsource, who should I outsource to, who should outsource, when should I outsource,what should I outsource and where should I outsource. Making the right decisions aboutwho to outsource to, when to outsource, where to outsource and what to outsource can go a long way in helping you make the most out of outsourcing. This article gives you insight on the five Ws of outsourcing, namely, who should I outsource to?, why should I outsource?, what should I outsource?, when should I outsource? and where should I outsource to?

Who Should Outsource?


Today, outsourcing has become the order of the day. Almost every organization is outsourcing. If you are unsure about stepping into outsourcing, analyze your organizations' needs and find out if your business really requires outsourcing. Ask yourself the following questions. Is my organization finding it difficult to meet customer needs? Does my organization want to remain small, but has a huge market presence? Does my organization have managers who are not sure about which product lines make/lose money? Is my company experiencing constant challenges based on operational issues? Does my organization lack the expertise that would grow my business? Does my organization have important nonrecurring project requirements but no resources to handle them? If you have answered 'yes' to more than one question, then you must venture into outsourcing. Outsourcing can help you to efficiently deal with the following challenges. Outsourcing can help you to meet your customer needs on time, make a huge market presence, make the right decisions about product lines, overcome operational challenges, get access to expert services and benefit from professional resources who can competently handle your projects. It does not matter to which industry your organization belongs to. Outsourcing can bring tremendous benefits to any type of business, be it B2B, B2C, SMEs, large diversified La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 110

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companies or small home offices. Make a decision to outsource today and see a transformation in your business.

What will I benefit from outsourcing?


Outsourcing can give you access to the several benefits of outsourcing. The following are a list of some of the benefits of outsourcing.

Get access to the best & latest in workflow technology without any capital investment Benefit from professional and skilled services Better and cheaper services Save on time, effort, infrastructure and resources Large volumes can be completed on time Increased efficiency and productivity Reduced capital and labor costs Faster time to market Improved processes bring about improved customer satisfaction Gain a competitive edge with sophisticated technology and people Benefit from operational efficiencies without capital investment Benefit from better performance and management Benefit from process maturity and scalability

Get ahead of the competition with strategic outsourcing. Outsource to O2I now. What should I Outsource? You can outsource almost anything today. You will be able to easily find an outsourcing provider for any service that you might want to outsource. The following are a list of services that can be outsourced to India. India has a large talent pool of skilled professionals who can efficiently provide the service that you want to outsource. Our key services are:

Call Center Services Data Entry Services Software Development Mortgage Services Engineering Services 111

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Healthcare Services Financial Services Photo Editing Services Research & Analysis Creative Services

Outsource your business processes and focus on your core competencies. Tell us your needs.

When should I Outsource?


The right time to outsource would be when you want your personnel to concentrate on your core competencies. While your resources focus more on business critical functions, other functions which are not critical can be done by your outsourcing provider. If you want to get access to expert services, then again it is the right time to outsource, If you want your services to be completed on time, in a faster, cheaper and better manner, then again it is the right time to outsource. If you do not want to invest in software, technology, manpower and resources, then you must consider outsourcing. Finally, if you want your organization to gain a competitive edge, then you must outsource.

Where should I Outsource?


There are many countries that you can outsource to, but the best country to outsource to would be India. India is the world's outsourcing hub and the most preferred outsourcing location in the world. India is the most ideal place to outsource to, because India offers many advantages. Outsource to India and benefit from cost-effective services, skilled resources, specialized services and timely deliveries. Several global organizations have set up offices in India, to tap the benefits that India offers. Asking yourself the 5Ws of outsourcing can help you make the right outsourcing decision.

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Outsource2india http://www.outsource2india.com/why_outsource/articles/ethics_outsourcing.asp

The Ethics of Outsourcing


Should you outsource? Are you not causing a loss of employment in order to save costs? These are only a couple of questions that have been posed by critics of outsourcing. Ever since outsourcing caught on in Western countries, there has been some opposition to it. A loss of jobs in the host country has been touted as the main negative effect of outsourcing. While the argument is valid, companies have outsourced many of their functions to stay competitive in a fast paced market. Organizations hire specialized companies, not necessarily outside of their country, to outsource many tasks that could be better handled by a vendor. The biggest benefit of outsourcing is that not only does it save costs for a company, but also gives it access to resources and skill-sets that wouldn't have been possible locally.

Ethical dilemma in Offshore Outsourcing


It is now widely accepted that outsourcing is not just a cheap labor tactic, but also a strategic business decision. However, ethics and outsourcing continue to be burning issues for many businesses who want to make the move to outsourcing. Quality, control and cultural differences are a few concerns that keep coming up when one talks about the risks of outsourcing. For more than a decade, Outsource2india has worked with customers across the globe. One of our primary tasks has been to strengthen relationships by letting our work speak for itself. Through these relationships we have been able to demonstrate that instead of outsourcing harming jobs, it has in fact given more freedom to companies to operate competitively and be successful. We discuss below some key issues when it comes to handling the ethical dilemma in offshore outsourcing.

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Quality of Service
Companies that outsource have often had to face resistance and complaints about a drop in quality when moving jobs. In the early days, outsourcing was seen as a cost-saving measure, with an expectation of low-quality output. Things have changed drastically since then. Outsourcing relationships now define quality as one the main deliverables, among others. One of the pitfalls of failed outsourcing relationships is not being able to identify the right partner for a company's outsourcing needs. There are a few so-called outsourcing providers who charge rock-bottom prices that have attracted companies. While a few of these sweatshops might succeed in the short term, companies dealing with them have had bitter experiences with low quality output, mismanagement of resources and security issues, etc. Outsource2india has built a reputation for educating customers about both the advantages and disadvantages of outsourcing. Our ability to work with a business's goals rather than focus on specific projects has helped us forge strong relationships with customers across the globe.

Work Environment
Below-par work environments and shoddy HR policies are two other reasons that critics often quote to describe how 'body shops' have sprung all across India to meet outsourcing demands from the West. While this argument might have held water in the past, the reality is much more different now. Barring a few, outsourcing providers in India employ world-class work environs and systematic HR processes. The attrition rate in the Indian IT/ ITES industry is comparable to or even better than that of other nations.

Security Concerns
Security and privacy of data are valid concerns, but are often misused by those who warn against outsourcing. Data security measures need to be put in place, whether a company is planning to outsource or not. Confidentiality agreements, firewalls, SLAs and solid infrastructure are some parameters one needs to look at when entering into an outsourcing arrangement. Past customer references La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 114

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and experiences can also give you insight into how risk-proof an outsourcing vendor might be.

Cultural differences
Cultural differences between the West and Asian countries are huge, and are often a cause for worry in an outsourcing relationship. But these can be bridged by understanding the cultural sensitivities and how they can affect the outsourcing relationship. This needs to be done early in the relationship to avert any issues that can crop up later. That said, a lot of Indian companies are now sensitized and trained in Western cultures, which help reduce any culture shock.

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www.efficaciapersonale.com Outsource2india http://www.outsource2india.com/why_outsource/articles/5-outsourcing-challenges-solutions.asp

Top 5 Outsourcing Challenges and Solutions in Present Times


Outsourcing traces its early origins to Industrial Revolution, but it was only towards the late eighties that it came to be accredited as a full-fledged business strategy. Since then, it has manifested itself in various revamped avatars. At present, no industry has been left untouched by the gargantuan outsourcing waves; and fancy monikers like near-shoring, offshoring, KPO, BPO, LPO, ITO, etc., and many other specialized outsourcing fields that have lately come into the picture. The illustrious journey of outsourcing began with the Manufacturing sector and has ramified gradually into sectors such as Banking, Pharmaceutical, Hospitality, Information Technology, and so on. Outsourcing has definitely provided corporations around the globe with much sought-after cost-saving finesse and peace of mind to focus on core activities, but along with it comes some pestering challenges. Over-fluidity in outsourcing is encouraging businesses to develop new airtight strategies for combating these challenges. Top 5 Outsourcing Challenges and Their Solutions Let's map out some of the present outsourcing bottlenecks and their possible solutions.

Challenge# 1: Bleeding of In-house Human Resources - It has been noticed that the very name of outsourcing sends shivers down the spine of existing employees. The implementation of outsourcing creates a sense of uncertainty among the current workforce and induces them to hunt for greener pastures. This is a real jolt to the organization and can upset the human resource applecart. Solution: Although axing of some employees is inevitable, organizations can address this issue by internally developing center of excellence for individual domains. This will help existing employees get past their fears, get trained in new core processes or technologies, hone their expertise, and grow further along with the organization.

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www.efficaciapersonale.com Challenge# 2: Selecting the Right Service Provider - Selecting the right vendor is the bedrock on which the entire outsourcing process depends. If there remains a flaw in the selection phase, then clouds of frustration and breach of promise are bound to overcast the contract in due course of time. Solution: Vendor should be selected strictly according to the requirements of the organization and the desired output needed. Before signing the dotted line, business owner should be sure to ascertain the type and tenure of the contract. Even going for a test run before getting into a long-term agreement is a good idea. After implementation, key performance indicators should be monitored frequently and the 'Balance Score Card' method should be applied to do the performance appraisal.

Challenge# 3: Legal Tangle and Lack of Understanding of the Contract - If the legal implications of the contract are vague to both the organization and the service provider, it will fizzle out the initial hoopla surrounding the outsourcing decision. Many outsourcing companies overlook legal issues and face outsourcing failures. Solution: To avoid any future legal complications, the contracting parties must conform to the local legislations hook, line, and sinker. At the time of negotiation of the contract, all executives from both sides must be on-board and the terms of contract should be made clear to each one of them responsible for taking the outsourcing decision.

Challenge# 4: Cultural Concerns - Cultural stereotypes and niceties are increasingly playing an important role in determining the fate of the outsourcing deal. There are two types of cultural peculiarities: Corporate and Country-specific. Outsourcers often find it difficult to rectify cultural tangles. Solution: The complexities of the process you are trying to outsource, and the impact of outsourcing to people of a different cultural background should be studied beforehand. Cultural coherence and synchronization can be attained by putting in place a sound multi-cultural sensitization program for both outsourcer as well as the service provider. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 117

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Challenge# 5: "Outsource and Forget" Cannot Work - Gone are those days when an organization can set itself totally free of non-core activities after delegating the same to external service providers. Solution: Even if the organization has delegated the non-critical operations to a third-party, it should be on its toes to face any exigency. Also refined monitoring processes should be set in place, so that outsourcing organization is in total control all the time.

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www.efficaciapersonale.com Flatworld Solutions http://www.flatworldsolutions.com/articles/pros-cons-outsourcing.php

The Pros and Cons of Outsourcing

What does outsourcing and offshoring mean?


Outsourcing is the process of assigning a companys business processes to an external agency in lieu of enhancing service quality, driving innovation or deriving benefits of lower labor costs. When outsourced to organizations located in other countries or to foreign subsidiaries, Outsourcing often takes the form of offshoring, also known as offshore outsourcing.

What are the effects of outsourcing?


The effects of outsourcing are subjective to the industry and the purpose for which the same was undertaken. However across industries outsourcing is primarily undertaken to enable companies to generate better revenue recognition and to provide them an added competitive differentiator. While done with the best of intentions, outsourcing has a telling effect on quality of products and services delivered as a consequence of this, either enhancing or lowering quality. While there could either be an increase or decrease in the turnaround time while outsourcing, it could also result in improved or decried customer service. Outsourcing, primarily undertaken to provide companies the competitive edge, can also result in easier management and better productivity based on how effectively the process in managed.

What are the pros and cons of outsourcing?


Outsourcing is often undertaken to provide enterprises a competitive advantage by delegating business process to external agencies and realizing the benefits of low labor, better quality and improved innovation. While this provides a good picture of the fair side of the coin, most managers however need to grope with the possible shortcoming of the process and the corresponding impact on the companys core processes. To best analyze the opportunities presented it is essential to reflect upon the advantages vis--vis the disadvantages of outsourcing.

The pros of outsourcing


The pros of outsourcing often positively reflected by enterprises across industries include: Better revenue realization and enhanced returns on investment Lower labor cost and increased realization of economics of scale Tapping in to a knowledge base for better innovation La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 119

www.efficaciapersonale.com Frees management time, enabling companies to focus on core competencies while not being concerned about outsourced routine activities Increases speed and the quality of delivery of outsourced activities Reduces cash outflow and optimizes resource utilization

The cons of outsourcing


Often weighed with the advantages before any decision on outsourcing is undertaken, the following represents some of the possible disadvantages often dwelled upon: Possible loss of control over a companys business processes Problems related to quality and turnaround time Sluggish response times coupled with slow issue resolutions Shortcomings in performance vis--vis expectations Lower than expected realization of benefits and results Issues pertaining to lingual accent variation An irate customer base coupled with enraged employee unions

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Flatworld Solutions http://www.flatworldsolutions.com/articles/secure-outsourcing.php

9 Guidelines to Secure Outsourcing


The following are a list of guidelines to help you outsource securely. Today, customers are hesitant to outsource because of security issues. If some of the simple guidelines listed below are followed, you can outsource and stay worry-free. 1. Having a good security policy The first step to be followed before outsourcing is to ensure that your organization is in order. You must also check your security policy. A good security policy will be sound and rational. Some of the important facets of your policy should include a data classification that can distinguish between sensitive and common data. The policy should also state clear standards and guidelines. These guidelines should be finalized by the stakeholders, managers and employees of your organization. 2. Selecting the right outsourcing vendor Selecting a right outsourcing vendor is one of the most crucial steps to be followed while outsourcing. Select a vendor who follows a strict security policy. You must also ensure if the selected vendor makes security a rule in his organization. Your vendor must also have security rules that protect your data from being copied to portable devices. 3. A sound privacy and intellectual property policy Check if your vendor has sound intellectual property protection laws. Make sure that your vendor will go by your privacy and intellectual property policies. Make these clear with your vendor to avoid later misunderstandings. 4. Protecting your data Start employing the use of database monitoring gateways and application layer fire walls before outsourcing. These devices can help you enforce usage policies. Such devices can also prevent privilege abuse and vulnerability exploitation. Choose a vendor who employs both these functionalities. This will help in the total protection of your data. 5. Providing Education on handling data Check if your vendor is educating his/her employees on how to handle and protect sensitive data. In case your vendor is not providing education, ensure that he/she provides education. This is very important, as this will help ensure the security of your data. 6. The rule of least privilege Before outsourcing, decide on a method to monitor material exceptions on your vendors and ensure the rule of least usage. Most of all, do not provide access to all your records during the same time. Ensure that this is also monitored. 7. Leak-Proof traffic La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 121

www.efficaciapersonale.com Make sure that your vendor monitors outbound Internet traffic and checks emails for potential information leaks. These checks would ensure leak-proof traffic. 8. Ensuring application and network security audits Conduct regular application/database security audits and network security audits. This will help in ensuring secure outsourcing. Audits can help identify issues and potential vulnerabilities with the applications, databases and devices on the network. 9. Ensuring that prevention technologies are employed? Check the prevention technologies that your vendor uses. Inquire if your vendor has a technology to control data flow. Also check if your vendors policies are followed by the employees. Make sure that your vendor has technologies to protect sensitive data from being emailed or copied to removable types of media. Experience Secure Outsourcing with Flatworld Solutions When you outsource to Flatworld Solutions, you can be assured of the complete security and confidentiality of your data. We take the security concerns of our customers very seriously and have taken necessary security measures to ensure complete data privacy. Dont let security concerns stop you from experiencing the benefits that outsourcing offers. Outsource to Flatworld Solutions and experience the best of offshore outsourcing while staying assured that your confidential data is in secure hands.

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Flatworld Solutions http://www.flatworldsolutions.com/articles/first-outsourcing-project.php

Top Ten Rules for the First Outsourcing Project


Outsourcing has dramatically increased the fortunes of many companies making it an attractive business opportunity that many want to try out. While the whole concept of 'outsourcing' is pretty simple, most companies choose an outsourcing company based on only one or two factors and this very often leads to failure. In order to avoid facing an 'outsourcing disaster', there are a few basic factors that one has to take into consideration before making the decision to outsource. Listed below are the top ten rules that have to be followed before choosing to outsource your first project. 1. Do the required groundwork: Outsourcing companies vary dramatically in size, infrastructure, capital, language, and talent. Make a list of the different companies and categorize them based on their plus and minus points. While factors like size and name recognition are important, the winning outsourcing vendor will have to have the right combination of the factors that best suits you and the needs of your project. It is important to remember that factors like technology infrastructure, language and talent play a much more important role in the choice of the outsourcing company than mere size and capital. 2. Start out with small tasks: It is prudent to start out your first outsourcing project with a small task. Once this task is determined, and a decision is made to use an outsourcing vendor, the task must be described in clear detail, mentioning the expectations from the outsourcing company, the objectives and all necessary details of the job that needs to be done. Once completed, you will be able to discern if there are any outsourcing problems that need to be addressed. 3. Set clear expectations: Making sure clear expectations are set before the onset of an outsourcing project can eliminate certain outsourcing concerns to an extent. Common outsourcing problems like time delays, exceeding project costs and quality of the completed work can be minimized when you choose to be upfront and clear about what you consider as good work. 4. Be prudent about paperwork: Complete all necessary paperwork before the start of any outsourcing project. Be sure that you sign all necessary security and confidentiality agreements. Also ensure that all aspects of legal issues concerning outsourcing are well covered. 5. Pay a fair price: Try to avoid mixing in a "cost cutting focus" in your first project. It's natural to want to go on a bargain hunt, but if you find a good vendor that you can afford, don't haggle too much. Your priority here should be to pick the right outsourcing company that matches your specific need and not the one which accepts a few thousands less. 6. Be culturally sensitive: A common outsourcing problem faced by those outsourcing their first project is the differences that crop up due to disparity in culture. Since most outsourcing companies are based out of Asia, you may be required to deal with certain La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 123 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com cultural differences. Trying to accommodate these differences can help your relationship be more efficient and pleasant. 7. Try delegating instead of abdicating: This is a common outsourcing concern faced by many newcomers. They forget that the concept of outsourcing is based on delegating and not abdicating your core and non-core activities. Delegating is a long running task that involves giving directions, controlling execution, providing ongoing feedback, and making sure that your outsourcing vendor is accountable for their actions. 8. Create a safety net: Outsourcing is a high risk activity and it is essential to have a backup plan that will take care of the situation if an outsourcing problem occurs. Creating a safety net for your project will serve the twin purpose of helping you incase the outsourcing project fails and giving you the space to act with more confidence. 9. Communicate effectively: Developing proper channels of communication is essential to the success of your first outsourcing project. In different countries, people have their own way of communicating, so it might take a little time to understand the proper way to criticize work or discern when a 'yes' means 'no' or vice versa. Also ensure that you place daily status calls to the outsourcing company to curb the growth of any unseen or last minute outsourcing problems that may occur. 10. Know when to quit: In the event of an extreme case where an outsourcing problem continues to deteriorate even with your continuing efforts to salvage it, it is better not to waste any time but to choose to terminate the project with the outsourcing company as soon as possible. This is a much better option than choosing to wait till the last minute and incurring heavy losses. Finally, it is important to remember that it never pays to outsource just once. For it is with repeated trials that you gain the needed efficiency to become a success. Opt instead to build on your success by correcting your past mistakes and adding complexity to succeeding outsourcing projects.

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Flatworld Solutions http://www.flatworldsolutions.com/articles/offshore-outsourcing-business.php

How to Successfully Manage your Offshore Outsourcing Business Ventures


Your organization has decided to leverage the advantages of outsourcing to India, but you are worried about how you will be able to successfully manage a project going overseas. Proper management is very crucial to the successful completion of an offshore outsourcing project, and if managed well, you can be sure to see a marked improvement in your productivity. The key to managing an offshore assignment is following a well-laid out plan for the project from the onset of the work. If you expect an increase in performance and a reduction in cost, then you must follow effective management strategies that will help you attain your outsourcing goals and improve your business. Successful offshore outsourcing depends on managing risks, increasing control on the project, improving co-ordination and reducing the chances of project failure. Here are a few tips to help you get started on a successful outsourcing business venture. 1. How to manage cost risks Your primary reason for outsourcing is to cut down on cost, so it is critical that you should make the maximum savings in terms of cost. There are service providers, who might offer you services at a low cost, but hidden costs or the initial cost of starting the project might make you pay much more than you expected. To best avoid such cost risks, sign up with a vendor that provides services with no hidden infrastructure, maintenance or training costs. Ensure that your vendor offers complete financial transparency, providing you with periodical invoices. Analyzing the overall cost of the project and the scope of the work with the vendor can give you a clear picture of the cost of your outsourcing project even before starting it. 2. How to manage communication risks Regular, open and direct communication with your outsourcing vendor is critical to the success of your project. Choose a service provider that has established communication systems such as Email, Phone and Chat. To keep track of the progress of your project, ask for daily updates and hold weekly meetings. Directly communicate with your vendor about any questions that you might have. Give clear instructions about how you would like the work to be carried out. Explain that you would like your vendors employees to directly communicate any project queries with you. Clarify these queries immediately and provide regular feedback to avoid any setbacks or delays. To reduce communication oversights ensure that you openly and constantly communicate with your vendor. 3. How to manage knowledge transfer risks La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 125

www.efficaciapersonale.com To see a marked increase in the level of productivity, you must ensure seamless knowledge transfer between your company and your offshore vendor. Before the onset and during the course of the project, make certain that all important information is conveyed directly to your outsourcing partner. Resolve any queries that your vendor might have and create a common location where documents/ spreadsheets can be easily shared. When knowledge transfer is effectively carried out, you can be sure of a successful outcome. 4. How to manage performance risks To best avoid the risks associated with performance, decide on a timeline with your vendor, at the onset of the project and ensure that the work is completed within this timeframe. Contacting previous customer references can give you a fair idea about the vendors performance and quality level. A few weeks / months into the project can help you better understand the actual performance level of your service provider. Based on this you can make adjustments, if any, to the project timeframe. Regular project reviews and analysis of the work can help you track the progress of the project. Address setbacks as and when they arise to avoid time delays. Although time is an important factor, ensure that your vendor does not compensate for it to the detriment of quality. 5. How to manage outsourcing risks Dont let the risk factor stop you from leveraging the benefits of outsourcing to India. As in every project, you might encounter risks with outsourcing, and especially with offshore outsourcing but you can minimize the risks. Before finalizing on a vendor or outsourcing your work, make a thorough assessment of all the possible risks that you might stumble upon. Analyze these risks and come to a consensus of how exactly you will address them, if they occur. 6. How to manage a crisis Choose a service provider who has had previous experience in providing offshore services. Ask for customer references and conduct a background research on the vendor. Hiring an experienced and trustworthy vendor can keep you away from catastrophic situations. Before outsourcing, analyze if your company can financially and professionally handle any unforeseen events.

Invest in the outsourcing relationship


Do not sign up with the very first offshore vendor you come across. Ask for past references and thoroughly conduct background research before finalizing on a service provider. Partnering with a reliable vendor can help you benefit from a long term outsourcing relationship. Mutual understanding, financial transparency, flexibility, direct communication and regular monitoring between you and your vendor can help you achieve a good outsourcing partnership. Investing in the outsourcing relationship can help you reduce cost while increasing your profitability.

Get your company organized before outsourcing


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www.efficaciapersonale.com Before outsourcing, re-look at the way your organization works and make changes, if necessary. You can make a start by evaluating your in-house capabilities and evenly distributing work between your offshore vendor and in-house team. You can consider outsourcing non-core business functions while handling your core business in-house. Choose a project manager or a team to monitor your vendor and address queries. Train your resources on how to effectively manage an offshore team and make the most of an outsourced project. Explain to your team the importance of communication and transparency with the vendor. Having a strong in-house management can help you successfully handle your outsourcing ventures. Partner with Flatworld Solutions today! Flatworld Solutions is a global outsourcing vendor who has over 12 years of experience in catering to the offshore needs of varied business verticals. Flatworld Solutions understands what offshore outsourcing is all about and can help you achieve your business goals. You can be sure to see a marked increase in your productivity and a sharp reduction is cost by partnering with Flatworld Solutions. Get in touch with us today and make the most of our expertise.

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Flatworld Solutions http://www.flatworldsolutions.com/articles/growth-of-outsourcing.php

Will Outsourcing Continue to Grow in the Years to Come?


Outsourcing, which started in the early '90s as a revolutionary phenomenon of sending unskilled work from developed countries to developing countries, has experienced tremendous growth over the past ten years. Now, after more than a decade of outsourcing, the success of outsourcing is being questioned. Will the advantages of outsourcing become overshadowed by governmental pressures and rising offshore outsourcing costs? Will outsourcing continue to grow or be curtailed by force in the years to come? Industry experts, who have been studying the disadvantages and advantages of outsourcing, feel that the future of outsourcing will continue to remain secure mainly due to the various benefits that outsourcing brings both to the buyer and the offshore provider. The benefits of outsourcing are manifold- the most important being cost-effectiveness and better infrastructure, and this has lead to its sustained growth. Careful assessment of the various offshore outsourcing trends have reveled that outsourcing to India and other countries will continue to grow due to the following reasons.

Cost savings will continue to be a major advantage of outsourcing


One of the major benefits of outsourcing in the early years was the vast difference in cost. Companies were able to reduce their overall expenditure considerably by paying less than half the usual amount in salaries to their offshore outsourcing partners. In the late 90s many outsourcing experts predicted that cost savings would no longer be one of the main advantages of outsourcing due to the rising cost of living and technological advances. But the financial woes brought on by the 2008-2009 economic crisis has made the whole concept of cost saving even more important. With the economic recovery still unsure cost saving remains one of the major reasons for outsourcing to India.

Outsourcing will focus more on core business activities


Latest trends in outsourcing point to the major change of focus from the outsourcing of noncore services to the outsourcing of core business functions. Most businesses, with a significant number of SMEs, consider fully outsourcing their IT department, not only to save money, but especially to gain better experienced and skilled specialists to produce high quality solutions. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 128

www.efficaciapersonale.com Outsourcing to India, especially IT outsourcing, is on the rise due to the abundance of qualified professionals who have the skills, resources, and methodologies it takes to create superior results.

Standardized outsourcing solutions will be favored over customization


Another trend that will affect the future of outsourcing is the move towards standardization of outsourcing solutions. The economic crisis of the recent years has led to companies favoring standardized outsourcing solutions over custom made solutions which are more expensive. Companies prefer to use their dollars saved to acquire new customers and to think out new business concepts. This has led to organizations outsourcing to India and other countries more willing to move to a standardized way of working for non strategic processes. With the huge pressure to keep costs down, service providers will also rely more heavily on mass automation tools that will create additional opportunities and reduce the staff necessary to support critical business applications.

Outsourcing of smaller projects will continue to be an important benefit of outsourcing


The future of outsourcing will witness an increase in the outsourcing of smaller projects. Although big corporate houses will continue to outsource huge projects to major service providers, there will be an increase in smaller buyers who will be looking for flexible and specialized smaller providers to support them in realizing new business concepts. This benefit of outsourcing will be even more applicable to entrepreneurs and individuals who spent years watching from the sidelines and who now want to benefit from a piece of the outsourcing action. Outsourcing of smaller projects will help companies, especially those looking towards outsourcing as a way to resurrect their businesses as the economy rebounds. Outsourcing to India will also continue to rise due to a surge in smaller IT service deals from first-time buyers.

Outsourcing and cloud sourcing will merge and grow exponentially


Industry experts who have been observing the benefits of outsourcing and cloud sourcing predict that cloud sourcing will soon merge with the existing outsourcing market and provide better opportunities for the entire outsourcing industry. With businesses in general pushing towards cloud solutions for different reasons like flexibility, scalability and cost savings, La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 129

www.efficaciapersonale.com outsourced IT services will be required for migration of existing infrastructure and services to make them cloud enabled. This major advantage of outsourcing will benefit infrastructures supported by cloud resources and other smaller outsourcing providers. On the whole outsourcing is expected to increase dramatically in the years to come. This is because globalization which inextricably links the worlds economies leaves no room for individualism. Companies will not be able to meet the various challenges they face relying solely on their own internal resources but will have to look beyond for more cost-competitive and capable sources. This is where outsourcing and the many advantages it brings with it plays an extremely important role.

Mark Kandinov http://buildingbridgeschicago.com/small-business-outsourcing-tips-for-a-beginner/

Small Business Outsourcing Tips For A Beginner


Many small businesses face shortage of human resources and space to administer the increasing world load. Inability to handle workload makes the clients unhappy which may hamper the growth process. In such a scenario, small business IT support companies can provide an ideal solution to ensure smooth functioning of the business without any stoppage and hassles. Choosing a right outsourcing service can make a major difference between success and failure in the current dynamic business environment. However, many small business owners lack the knowledge to select a reliable outsourcing service. The following are important small business IT outsourcing tips for beginners

Evaluate what needs to be outsourced.


Projects requiring brainstorming and team interaction are not suitable for outsourcing. Never outsource critical and core business functions such as financial planning, decision making etc. On the other hand, self contained projects and tasks such as payroll distribution, tech support, customer support, marketing, accounting work, equipment maintenance and repair etc works best with outsourcing.

Determine outsourcing budget.


Work out a budget to allocate funds for outsourcing. Have excess funds in the budget for meeting unexpected costs such as short term projects or additional services required.

Get ready for challenges.


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www.efficaciapersonale.com It requires time to build a relationship with outsourcing services. So, be patient for synchronizing time and a relationship with your outsourcer.

Dont choose outsourcing services blindly.


Take the help of paid consultants in selecting the best outsourcing services for your particular needs. Evaluate the strengths and weaknesses of outsourcing services to gauge whether they are suitable for your particular business needs. It is better to pay for quality services rather than feeling sorry later.

Begin with micro outsourcing.


In order to check the reliability of the services, outsource small tasks. After getting positive and cost effective results, outsource major operations.

Keep sufficient staff to act as a liaison.


Since no business outsources accountability but functionality, having a staff to act as a liaison is a prudent idea. The staff will take care of any problem should anything goes wrong with outsourcing.

Check out hidden cost.


Many outsourcing services offer cost effective services apparently, but include other charges in the agreement. Hence, it is preferable to go through the terms and conditions of the agreement before committing to any service provider.

Seek affordable services.


Since the main aim of outsourcing is to save money and free up time for focusing on other vital activities, look for IT support companies that offer services at reasonable rates. Shop wisely to select the most economical service provider.

Check their credentials.


While selecting outsourcing services, verify their credentials to ensure they are qualified and competent to complete the desired work. Similarly, make sure they carry necessary license for outsourcing.

Check the quality of services.


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www.efficaciapersonale.com Ask for references and testimonials; contact testimonials to find out the quality of services as well as their satisfaction rate. Similarly, read online reviews to find their reputation regarding quality of services.

Inspect authenticity.
Since the data to be outsourced may be sensitive, check out the legitimacy of these services by ensuring they have better business bureau affiliation. This will avoid any kind of online fraud and assure that your confidential data is not exposed to competitors.

Verify customer support.


Getting quick responses is necessary in times of emergencies. Find out the support services to make sure they offer necessary support to resolve all queries in a timely manner. It might take a bit of time to get right, but small business IT outsourcing benefits can be tremendous. Businesses that choose a right outsourcing service enjoy an edge over their competitors and often stay ahead in the competition.

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Geri Stengel http://www.stengelsolutions.com/tips16.htm

Ten Tips for Superior Outsourced Relationships


Why outsource? The foremost reason is the desire to achieve best practice while maintaining discipline over costs. Outsourcing also allows a company to simultaneously improve service quality and focus on core competencies. Furthermore, going outside enables a firm to gain access to new technologies and skills, reduce head count and develop new products or services without exposure to additional capital costs. Here are ten points to consider when outsourcing. 1.

Pick Areas to Outsource: Companies must evaluate which, if any, internal functions would be better performed by an outsider. Outsourcing back-office operations such as human resources, finance, accounting and information technology (IT) can not only cut costs, it can also ease administrative burdens and improve flexibility and scalability. Get Senior Managements Commitment: As with any other significant undertaking, it is absolutely critical that the outsourcing project has support from senior management. Pick the Project Team: Outsourcing requires a great deal of in-house management in order to determine and deliver business requirements, ensure technical capability and manage the external relationship. Without this oversight, the potential for strategic gains can erode.
Once senior managers have signed on to the project, its important to have the committed participation of affected departments. Their representatives must be part of the process, because their input is critical to the projects success. They must support the decision, whatever it turns out to be.

2.

3.

4.

Assess Current Operations: Outsourcing relationships often fail when a firm outsources an activity its own personnel do not totally understand, and the provider promises to meet requirements that have not been fully defined, communicated and understood.
In order to make an intelligent decision about whether or not to outsource and to

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www.efficaciapersonale.com whom you first need to fully examine your needs. Make sure that outsourcing is a good fit for your overall corporate strategy. 5.

Define the Scope of the Project and Develop Objectives: Begin by defining the problem and the desired outcome. (Are you trying to lower operating costs, increase flexibility or gain access to best-of-breed solutions?) Find out if your competitors strategies are working successfully for them. Determine whether outsourcing will enable your organization to concentrate better on your core competencies. Evaluate the risks and determine if theyre acceptable. Determine Outsourcing Skills Needed: Youve defined the project. Now you need to decide what skills are critical for a vendor to have in order to service you appropriately. Look for:
Expertise in the process being outsourced. Extensive project management skills. An understanding of your business. The ability to integrate best-in-class service providers into the process. The willingness to establish performance measures. Knowledge or expertise that your company lacks internally.

6.

7.

Identify Potential Providers: Identifying potential providers can be a challenge, since there are hundreds of firms offering an array of services for a variety of clients. The industry is segmented in a number of different ways, so understanding your needs and which types of companies can best meet them is the first hurdle to clear. To start your search, get referrals, read trade publications and surf the Internet. Do Due Diligence on Vendors: Several vendors have submitted proposals and youre narrowed the field to two or three top prospects. Now, you need to go beyond the proposal to make sure the vendor is a match for the project.
Ask for references. Make sure that their corporate vision and goals are compatible with yours. Evaluate their experience so you dont hire someone who doesnt have the right expertise or capabilities. Find out how the firm trains and develops staff, and how successful it is at keeping them. Discuss the vendors contingency plan, so youre clear what happens should something goes wrong.

8.

9.

Make Vendors Accountable: The buyer should hold the vendor responsible for living up to specific requirements. This can be accomplished with a contract that covers among other things the level of accountability, job parameters, scope of work and performance yardsticks. Determine in advance the penalties (including financial) for nonperformance, and spell them out in writing.
Give serious consideration to an escape clause. If things aren't working out soon after you begin, being able to terminate the contract without a penalty is much easier. For example, your contract might allow for a penalty-free termination within 60 days.

10.

Determine Whether Youre a Candidate for Outsourcing: Companies that are good candidates for outsourcing share several characteristics, including:
Well-established goals for what they want from the relationship.

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Support from management as to the benefits of outsourcing. An understanding that outsourcing is a long-term strategic relationship and not a short-term, quick-change effort. Operational benchmarks for processes within their business so that outsourced functions can be verified and measured. Clearly delineated parameters for the process that will be outsourced. The basic drivers for establishing an outsourced relationship, such as the need to refocus on core businesses, reduce overhead, improve customer service and increase competitiveness.

Alyssa Gregory http://www.sitepoint.com/31-tips-for-successful-outsourcing/

31 Tips For Successful Outsourcing


Youve thought about all of the considerations of subcontracting work, prepared for the transition and found a great subcontractor. Youre ready to start outsourcing. Here are 31 tips to make your outsourcing experiences as smooth as possible.

Come to an Agreement
One of the most important elements of subcontracting is making sure you and the subcontractor are on the same page and that there are no surprises. Keep these things on your list to help facilitate a smooth working relationship: 1. Use a contract 2. Make sure you agree on payment terms up front 3. Dont pay in full until the job is complete 4. Be clear on how and when you plan to pay the subcontractor 5. Agree on a timeline for the work 6. Include a non-disclosure/non-competition provision in your contract 7. Determine how you will receive project updates 8. Clarify confidentiality expectations 9. Build in a de-bugging provision that identifies a specific period of time the subcontractor will be on call to fix potential problems that arise 10. Clarify the ownership of the project in writing

Protect Your Business


When you outsource, you are giving up some of your control over the project. Consider these tips to help you protect your business, interests and reputation: 11. Check references 12. Review the subcontractors portfolio La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

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www.efficaciapersonale.com 13. 14. 15. 16. 17. 18. 19. 20. 21. Verify skills Consider a small test project first Be prepared to review all work before turning it over to the client Be very clear about expectations Dont leave any details out when relaying the project request to the subcontractor Send all work requests in writing Schedule an initial call and regular check-ins, if necessary Be available throughout the duration of the project Track all payments for your books

Client Relations
The goal of the project should be to meet and exceed the clients needs. In order to do that, follow these tips to manage your relationship with your client: 22. 23. 24. 25. 26. Be the middleman Tell your client you are using a subcontractor, if appropriate Pad the time estimate provided by the subcontractor in your estimate for the client Dont forget to add in time for your management role Be accountable for your work AND your subcontractors work

Aside from the Work


Remember the importance of the personal side of your subcontractor relationship. Here are some ways to do that: 27. 28. 29. 30. 31. Dont overlook the importance of complementary personalities Respect the subcontractors time Make sure there are no communication gaps Give praise and appreciation for a job well done Ask the subcontractor how it went at the end of the project and provide feedback

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Bryan Haines http://onlinebusiness.about.com/od/dailyoperations/a/3-Ways-To-Outsource-Your-Business- Tasks.htm

3 Ways to Outsource Your Business Tasks


Outsourcing has revolutionized the way business is done. No longer do business owners need to over invest in talent, office space and Human Resource managers. When you have a task that needs to be done, simply hire it out and move on to the next project. With the growth of the industry, we have witnessed a diversification of the way tasks can be outsourced. Here are the three most common: 1. Outsourcing Portal Heres how outsourcing portals work: Place your project requirements and receive detailed bids on projects from a pool of talent. The bidders maintain a full online profile complete with feedback and ratings from previous clients. The portal acts as a go-between, ensuring tasks are completed and payments are made as contracted. 2. Crowdsourcing Heres how crowdsourcing works: List your detailed requirements and have a pool of people compete, doing the work and pay the best result. This is very different from using an outsourcing portal. In this example, a number of people (or companies) actually complete the work but only one gets paid. While simple creative tasks can yield good results, complex tasks obviously will not offer the same quality because no one is ensured of even getting paid. 3. Economy Outsourcing Heres how economy outsourcing works: You can search a set of predefined tasks with predefined pricing. For example, for $5 you can find people who will:

send 5 tweets to my 52,000!!! FOLLOWERS on Twitter about you or your company for $5 La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com 137 Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

www.efficaciapersonale.com write your 10-15 page User Guide for $5 do a "movie trailer" style voice-over for your website/podcast/business, etc... for $5

My experience with these services is that they do get accomplished. If you have a complaint, you can claim your amount paid back. One of the complaints Ive heard for the marketing tasks (promotion of a link in Twitter or Facebook) is that virtually all of the new traffic and fans are from India. Not that this is bad, unless India isnt your target market. Rosemary Peavler http://bizfinance.about.com/od/startyourownbusiness/a/Doing_Outsourcing_Work.htm

Take Advantage of Other Companies Outsourcing Needs

You may be able to start a small business to fulfill a need for a larger business that is looking to outsource in a particular niche. In a recession, large companies are looking to cut costs in every area of their business. They look for the cheapest way to keep their business lean and mean and afloat. Sometimes, that means outsourcing rather than paying high salaries and benefits hiring employees for their firm. When Americans think of outsourcing, we tend to think of large companies outsourcing to other countries. Large companies also outsource to small businesses around the corner. Your business could be that small business. All you have to do is provide a needed product or service to larger companies that you can provide more cheaply, with high quality, than they can get from their own staff. A Case Study Does this sound like a tall order? Maybe not. Consider the recent story of a stay-at-home mother whose husband was laid off. Julie Trade decided to start her own business from her back bedroom in order to bring in some extra cash. Judy, 40 years old, had a background in marketing so she used it to prepare marketing and press materials. Judy got herself up to speed about new technologies, developed a client base including large companies who were outsourcing things like press releases. She now makes more money than she ever did working outside the home and is supporting her family while fulfilling her role as a stay-athome mom. An Example of a Possible Business Suppose you live in a small town or even a larger city and youre an accountant or a bookkeeper. Some of the smaller businesses in your area may not want to pay for the services of a CPA to keep their books or do their taxes. They may seek a more cost effective method of managing their bookkeeping and accounting and wish to outsource their work to a bookkeeper. There is a perfect opportunity for you to market your services. If youve been La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 138

www.efficaciapersonale.com laid off and want to start your own business, you can market your services to those small businesses and save them money that they would otherwise have to spend on a CPA. Take Advantage of Outsourcing Opportunities Here are some tips on starting a business by taking advantage of outsourcing opportunities: 1. Consider Your Skills What type of small business you would like to start depends on your skills. If you are a financial type, you want to go that route. If you have training in web design, theres your idea for a small business. You get the idea. Play to your skills and come up with an idea for a small business that fills a niche where you think businesses may outsource. If you already operate a small business, consider trying to expand your customer base by taking advantage of outsourcing opportunities. 2. Take a Look at the Businesses in Your Local Area Are there small or large businesses in your local geographic area that have tasks they are outsourcing or would like to outsource? How do you find out? Whatever your area of expertise or small business, call the director of that area of the businesses in your local area. Prepare a pitch before you call them. Find out what they need. If you can supply it, let them know. Have price quotes ready. 3. Dont Ignore Online Business Opportunities There may be lots of online businesses that would like to utilize your services if they knew you existed. Use social networking sites like Twitter, Facebook[/link">, and your own blog or website, properly tagged and optimized to draw in potential customers.

The online bidding sites where you can offer your work for sale have gotten so competitive that it is almost impossible to earn a decent wage so I am not going to recommend them at this time. 4. Develop your own Professional Marketing Materials In order to sell yourself as a viable outsourcing source, you must have professional-level marketing materials available for potential clients. If you are an expert in desktop publishing, you can do this yourself. If not, then hire someone to develop these materials for you. It will pay for itself in the long run. You will need business cards, a brochure, and samples of your work. If you can find a niche in your area of business where companies typically like to outsource their work, you can either start a new business during the recession and do quite well or you can add to your existing business. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 139

www.efficaciapersonale.com Bryan Haines http://onlinebusiness.about.com/od/dailyoperations/a/How-To-Start-Outsourcing-With- Freelancer.htm

How To Start Outsourcing With Freelancer


In this feature interview with Freelancer.com CEO Matt Barrie, we discuss how to start outsourcing with Freelancer. Learn what Freelancer does.
Bryan: How does the outsourcing process work? Please walk a new user through the steps. Matt: It works like eBay, but on reverse: instead of the "buyers" placing bids on a "product", it's the "seller" who does the bidding. If you're an employer, all you have to do to start is to post a project. After which, you will receive bids from our freelancers willing to do the work for you. Their bids would include the number of days they could finish your project, and the amount you have to pay for their service. Hire the freelancer of your choice, set up a Milestone payment (our on-site escrow service), and start on the project. You can release the payment after you're fully happy with the result. If you're a freelancer on the other hand, just search for a project you're interested in and are qualified for - there are tons of them, and there's a job waiting for all forms of skills and talents. You then place a bid on the project you want, have the employer create a Milestone, work on the project to the best of your ability, and get paid! Bryan: What's the smallest/simplest task you've seen handled on Freelancer? The most complex? Matt: One very easy job that's open for bidding right now is by an employer who wants to get a 4-month subscription to last.fm. He says the country he's in isn't serviced by PayPal so he's hiring someone who has a PayPal account and who can buy the subscription for him. For an example of a complex job, there's this one employer who wants a small circuit to be used for an automobile. It's still open for bidding.

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www.efficaciapersonale.com Bryan: What securities are in place to protect employers? Both in terms of work quality and information confidentiality? Matt: We have a reputation system whereby before you pick someone, you can see every job they've ever worked on, with feedback and ratings from their previous employers. As a freelancer earns a reputation on the site, they appear higher on the bid list. The people that appear really high on the bid list earn about a million dollars a year, and would most definitely think twice before doing something that could put a dent on their reputation. We also have the Milestone payment system that works just like escrow. This system works both ways, meaning it's good for both the employer and the freelancer. When you hire a freelancer, you deposit money in the system. This ensures the freelancer that you intend to pay; but ensures you of an output because they won't be able to access the funds until you release them. At the same time, an employer can't just take the funds back unless the freelancer refunds them. This gives each party half of the control over the Milestone payment. If the project is completed, the employer can release the payment. If the project is cancelled amicably, the freelancer can cancel the payment and the money will return to the employer's account. If the parties can't agree as to the outcome of the project or an agreement has been breached (i.e., confidentiality agreement), they can go through our Dispute Resolution service. It's a system that's created to help the users work their problems out between themselves, but if it comes down to it, they can also get a human arbiter to go and make a decision for them. For the purposes of confidentiality, an employer can opt to post a private project as well. Bryan: How can an online business owner get started? Matt: There are tons of possible online businesses one can venture into. Technical knowhow helps a lot in getting you started, but is not necessary. As long as you have that spark of an idea, freelancers can help you turn that idea into reality. The most important things to consider are: 1. an attractive user interface 2. user-friendliness, and 3. search engine optimization First, you of course have to buy yourself a website and a domain. The next thing you would want to do is to create a logo for your business. You can do that cost-efficiently bycrowdsourcing it - hold a logo contest, for example. That's how we got ours. After which, you can have a programmer and a graphic designer work on the backbone and the graphical interface of your site. Next, have a search engine optimization expert market the site for you. If you have a small capital, you wouldn't want to hire a ton of people yet. La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento. 141

www.efficaciapersonale.com You could outsource these services to help you get started. Start thinking about full-time employees once the revenue pours in. Bryan: Many businesses are well established, easily handling their current workload and are very profitable. How can Freelancer help this type of business? Matt: Our platform promotes open, dynamic, and cost-efficient solutions to even the most well-established businesses. Especially with the current global economic situation, more and more businesses are looking to outsource tasks that do not require a full-time work force. Established businesses can also benefit from outsourcing simple tasks in order to have the in-house labor force concentrate on other aspects of the business. Outsourcing is revolutionizing the way people look at businesses and work forces. The wave of the digital information economy will normalize this process while Freelancer.com continues to be at the forefront of revolutionizing work as we know it. Bryan: What are some of the most profitable (or highest cost saving) tasks that can be handled on Freelancer? Matt: During the third quarter of the year, Google AdSense saw the highest rise in percentage (76%) in terms of job demands. In general though, the most profitable are the technology-based skills. 3D and Cocoa is rising fast with a 64% and 54% increase in demand respectively. Other programming languages (HTML 5, Objective C, CSS etc.) are quite profitable as well. Another very profitable category is writing. Product descriptions, ghostwriting, eBooks, blogs, and reviews are seeing a strong market. Most cost-saving would be design tasks that could be made into contests. For as low as $100, you could hold a graphic design contest and get hundreds of design choices from designers across the globe. So far, contests being held on our site have attracted about 800,000 designers completing about 400,000 design jobs. Every contest receives an average of 195 designs. That's 100% more than the number of designs you will ever get if you hire just one graphic designer for the same price!

La presente raccolta e stata elaborata dal team di EfficaciaPersonale.com Il copyright sugli articoli spetta agli autori citati e gli articoli sono raggiungibili direttamente attraverso I link contenuti in questo documento.

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