How to Build a Sustainable Strategic Outsourcing Partnership
Strategic outsourcing not only streamlines your processes but also leads to a sustainable partnership with your service provider-partner. Here are some tips on how to build a long-lasting productive relationship with your outsourcing partner.
#1 Develop a definitive plan that hashes out what you and your outsourcing partner will do to transform your organization.
Everything starts with a good plan. Without it, you’ll be lost. Create a roadmap of your sustainable outsourcing strategy; include all the projects you and your provider will be doing, the timeline of implementation, who’s responsible for the project, key performance indicators, and risk mitigation measures.
Be specific. For example, say you’d like to see a 30% reduction in administrative costs after three months rather than declare that you want to minimize your costs as much as possible.
Be organized. Schedule everything, even the small tasks. You can accomplish a lot when you break down the work into smaller tasks and delegating them to your team. Set milestones to signal an achievement for the team.
Be consistent. Don’t change tactics in the middle of implementing your outsourcing strategy. Establish your workflows and train your team to follow the process until the end. Be sure to align your outsourcing activities with your business strategy.
#2 Establish a good governance model of managing your outsourcing strategy.
To achieve a mutually beneficial, almost symbiotic relationship, partners are encouraged to adopt a governance model of outsourcing that lays down certain principles:
- Analysis, evaluations, agreements, and results will be communicated to all people affected within an appropriate timeframe.
- Management decisions will be prepared at a working level.
- You and your service provider will continuously bundle your expertise concerning all questions regarding problem-solving. All relevant problems will be analyzed and proactive concepts will be developed in order to avoid further problems or disruptions.
- You and your provider will solve conflicts near their origin. However, if conflict solving failed on lower levels, escalation follows. Both parties adhere to the agreed escalation mechanism.
- Both parties commit themselves to adhere to the agreed governance principles and to the continuous development of those principles.
#3 Good communication is a key factor in building a harmonious relationship with your provider-partner.
A strong foundation of any relationship begins with good communication. Don’t just rely on email and the reports your team sends to you on a daily basis. More than 90% of the time, we communicate in non-verbal ways. It’s important that you and your team can see each other’s gestures and facial expressions, and hear one another’s tone of voice when you’re in a meeting.
The quality of your communication process has a great impact on your relationship. When you’re discussing something important, make sure you exchange ideas with clarity and substance. Encourage your outsourcing partner to be proactive in providing feedback and sharing their ideas to further improve processes.
#4 Let your service provider-partner manage your short-term objectives while you take care of long-term goals.
Your outsourcing strategy will have both long-term and short-term objectives. Let your service provider-partner worry about the small stuff while you take care of the bigger tasks that add more value to your business.
Establish a collaborative relationship from the beginning. Your long-term goals may be dependent on some of your short-term goals. Make sure your outsourcing partner is on the same page as you. Don’t assume or make guesses. Don’t leave the room until you’re sure everyone understood what they’re supposed to do and when they’re expected to finish their tasks.
Divide the activities and responsibilities between you and your partner. Classify them by operational, functional and strategic levels. Specify whether the duties and tasks stated will be accomplished by you, your provider-partner, or by both of you.
#5 Build a partnership with your service provider-partner based on behavior rather than mere intention.
Adopting an almost clinical approach to your outsourcing relationship may backfire on you. It’s important that you and your partner share the same values and goals.
This is where soft controls come in. Soft value-based controls (trust, openness, empowerment and shared values, or TOES for short) are significant in any outsourcing relationship as they inspire co-operation on mutually established goals, values and behavior.
Soft controls like these improve employee morale, promote integrity among employees, increase motivation, and strengthen the collaborative nature of a strategic outsourcing relationship. That’s why building a strong remote culture for your team is just as important as managing the cultural differences between you and your service provider-partner.