September 25, 2007

Are You Ready To Outsource?

Here’s an article on 8 Signs That You’re Not Ready for Outsourcing. A number of very good points with a few examples of why outsourcing with smaller firms can be a big advantage. Some further thoughts on their points:

  • You haven’t done due diligence on potential vendors – Asking firms about turnover rate is a great idea. Don’t foget to dig deeper to understand the development team you will be working with. Make sure they are aligned with how you work and your expectations.
  • You don’t have any plans for managing the relationship on an ongoing basis – An often overloooked point when partnering with an offshore provider. It’s critical to have a person committed to making the partnership work from the client side. You can also look for providers that can offer a local person to help with making the relationship work, especially if the client lacks experience with software management.
  • You don’t have your own house in order – Being able to communicate who you are, what you do, and how you do it is always a good idea even to yourself. Getting this message to a potential offshore partner is an important first step to a long-term partnership.
  • You can’t compromise on customization – Getting exactly what you want from a partner is actually what you should expect. If an offshore partner is telling you no, try a smaller more flexible one. We are out there.
  • You can’t wait — literally — to get to market – Another case where a smaller partner makes all the difference. You also don’t need to give up process to get speed. Knowing how to balance the two is the hallmark of the best software companies out there. It’s no different for outsourcing vendors.
  • Your organizational culture is more about confrontation than collaboration – As with any partnership, you must build on a foundation of working together. When things go wrong, blaming a partner accomplishes nothing. Real partnership is about working together to do a better job in the future when you are confronted with problems. These are the opportunities to learn and get it right next time.
  • You won’t be ready to move forward aggressively on your plans – I don’t know if I agree with the need to be ready to move agressively, but you do need to be ready to move. Again, thinking through and planning how a partner can work with you to accomplish your goals is always an important investment. Make that investment from day one.
  • Your expectations about cost-savings are unrealistic – A great place to end the article. Saving money is a common place for people to start thinking about outsourcing, so it’s an important foundation. The big value will be in the business leverage you will have by building partnerships with firms that think and work the same as you. Two companies really aligned and working smoothly together let you accomplish great things.