The Keys to Outsourcing Success!

Application Outsourcing


Our series on outsourcing has addressed when you should outsource and the selection criteria you should evaluate when choosing an Outsourcing Solutions Provider including their location, communication / engagement process, and corporate culture. In the final part of this series, we will share the key strategies that you should implement to ensure that your outsourcing partnership moving forward is a long-term success, mirroring the successful partnerships that SGH Asia has established with our worldwide clientele.

Define Your Strategy
Outsourcing strategies are often categorised as either non-critical or strategic, depending on which function of your company they are addressing. However, the reality is that all outsourcing activities are strategic and impact your core business in a variety of direct and indirect ways. For example, when companies outsource their incoming Help-Desk and Customer Support Call Centres, the experiences of their customers are now in the hands of an external party; while for Accounting and Financial Services, the accuracy and compliance of their financial administration is also determined by a third-party’s expertise. Therefore, you must have a clear outsourcing strategy that incorporates benchmarking and objectives to ensure quality standards and ongoing improvement. To achieve this, designate an internal resource who has an in-depth understanding of the business, understands both the company’s short and long-term operational objectives, is responsible for transferring knowledge to the BPO provider, and modifies outsourcing strategies to fulfil changes in corporate requirements.

Define and Execute a Service Level Agreement (SLA)
When it comes to your outsourcing strategies, there are 3 critical documents that need to be defined, drafted, and executed with your BPO provider; the Statement of Works (SOW), Service Level Agreement (SLA), and Service Contract. These documents define the scope of support, the quality of service you expect to receive, as well as specific standards and benchmarks against which to measure. The SOW is the detailed description of the scope of support in all its dimensions. This is an extremely detailed document that lays a strong foundation for the project plan, including the activities to be performed, the deliverables to be achieved, and the timetable of implementation. Outlining the key performance indicators (KPI’s) for the delivery of the support or service in the SLA is where you define and execute your business strategy. For example, for incoming Help-Desk and Customer Support Call Centres you need to identify how you are going to manage and most importantly, measure, the high-quality experiences that delight customers. While for a technology-related BPO solution, you may identify and measure KPI’s related to data access, system downtime, and ticket logging, tracking, and resolution. When identifying KPI’s, it is important not to think in terms of minimum values and quality standards. Instead, identify the values and quality standards that ensure your business operates at its optimum levels. And finally, with the Service Contract, don’t be afraid to establish financial incentives as well as penalties for the over-achievement and under-achievement of KPI’s respectively.

Transitioning to the BPO Provider
With all documentation defined and agreed upon, now it’s time for the transitional phase where you migrate the tasks and responsibilities to the BPO provider ensuring business continuity. This is where you need to over-communicate to the BPO provider and furnish them with all the required information, access to systems, and understanding of corporate policies that you expect them to implement. During this phase, also be open to any recommendations provided, as BPO providers, like SGH Asia, not only possess functional expertise, but also have an in-depth knowledge of industry specific operations and best practices that they can share with you. Whether you are a smaller organization outsourcing an entire function of your business or a multi-national company (MNC) outsourcing a component of a larger function, the general rule here is to over-communicate and implement a thorough and detailed handover with extension reference documentation.

Engage with them as Business Partners
As previously mentioned, outsourcing business functions results in exponential benefits to your company over time, so it’s important that you select a BPO provider that you will partner with for the long-term. If you have effectively implemented the selection criteria and evaluation process that we previously shared, then you should be confident that you are now working with a BPO provider with extensive expertise and rich industry experience, that you can welcome as a strategic business partner. Together, you can share ideas and experiences, monitor and measure SLA’s, develop new strategies and business cases, and recommend ongoing improvements to ensure business processes are more efficient and effective.

The most important point to remember with the implementation of any outsourcing strategy, is that the necessary preparatory work must be completed first to avoid any conflict or disruption to your operations in the future. By effectively identifying when and which business functions to outsource, executing the relevant selection criteria and evaluation process when identifying a BPO provider, and implementing the keys to outsourcing success; the benefits of your outsourcing strategy will greatly outweigh your planning efforts.

Contact us to learn more about how SGH Asia supports more than 15,000 clients worldwide and can also be your perfect Outsourcing Solutions Provider and long-term strategic business partner.