Outsourcing is frequently touted as a universal money-saving tactic that can produce the same end-result as traditional employment, for a fraction of the price. While this is true in some instances, outsourcing is not always a smooth transition from in-house labor. Problems frequently arise in communication, quality standards, and managerial practicality, which can jeopardize entire operations if handled improperly. Below are some of the most common mistakes people make while outsourcing, and the disastrous outcomes that they might cause.
Hiring People Without Good Command of English.
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If there is one surefire way to enrage your customers, it’s sending their support requests to a call center in a fforeign country where your representatives speak very poor English. Chances are, if they’re calling your support line, they’re already not very happy with your product or service. Addressing their concerns by throwing up a language barrier is likely to cause further confusion, perhaps enough to convince them to abandon your brand altogether. USA Today ran a story about the problems this can cause customers in the travel industry in which they report, “There’s no question that call-center outsourcing is a volatile issue, affecting millions of Americans…and their quietly growing frustration has only hurt the same travel companies that made the decisions to off-shore customer service in the first place.”
Anger toward companies who use foreign call centers for customer support isn’t unique to the travel industry, either. Such practices are deplored almost universally, including in the technology industry where computer manufacturer Dell is infamous among their customers for directing all service inquiries through foreign call centers. The website “IHateDell.net” contains pages of forum posts from especially ticked-off Dell customers sharing their nightmarish experiences with customer service. If you are considering outsourcing your customer service department to save on costs, be sure not to hire representatives who do not fluently speak the language of your customer base. There is no easier way to destroy brand loyalty than this.
Failing To Have Them Re-Phrase Your Instructions To Confirm Understanding.
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Outsourcing labor almost always means managing a team of workers who are not native speakers of English. Despite their best intentions, your new outsourced department might have some initial trouble understanding the details of your request. InfoWorld writer Ephraim Schwartz writes that “The companies who’ve lived through outsourcing horrors have two things in common: lack of preparedness going into a new relationship and lack of communication once the projects gets under way.”
This lack of communication can cause all sorts of wacky problems to crop up, including the development of products or features you never asked for, or erroneous fixes to your current product that in no way resemble what you thought you ordered. Such errors might become so costly in both money, labor, and managerial time that you actually end up spending more on a lackluster outsourced job than you would have on a quality in-house job. A good trick to help you avoid confusion is to have your outsourced team re-phrase your instructions to you in their own language. Have a translator confirm to you that they fully understand what is expected.
Not Looking For Reviews on the Outsourcing Company You Hire
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You would never consider hiring an important team of workers without calling their past employers and checking their recommendations. Similarly, you should never use an outsourcing company without looking for reviews from other clients that have used them in the past. A simple Google search is often enough to reveal scathing reviews detailing catastrophes in working with that company, or solid reviews vouching for their effectiveness. The Internet has made such research quick, free, and easy to perform. Save yourself a development debacle down the line by checking out reviews the outsourcing company you are considering before agreeing to anything.
Paying Too Little
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Outsourcing is first and foremost a cost-cutting measure. Since workers in other countries require dramatically lower salaries than American professionals, it sometimes makes sense for a company to get the same work done for a fraction of the price. Many executives are astonished to learn of these salary differences and are sometimes all too eager to jump at the absolute lowest bidder. This is a mistake however, for as the old saying goes, you get what you pay for. The same is true for outsourcing. A programmer may claim to be a professional developer willing to work for a fraction of the salary of an American programmer, but keep in mind that you have no guarantee of this person’s skill level. Before hiring them, determine if they have ever received a formal education in the field, earned any certifications, or can vouch for their purported expertise with examples of their work and professional recommendations.
Hiring an amateur worker who claims to be a professional simply because his or her salary looks very advantageous can cause an entire product launch to be blown by weeks, if not months of time due to incompetence.
Lack Of Supervision and Structured Progress Reports
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Keep in mind that it is unarguably more difficult to supervise a team of workers in another country than it is to manage one in your office building. This poses a unique managerial barrier that is crucial to overcome. If you are outsourcing a very important project, it makes sense to send a trusted in-house manager overseas to manage the team and relay status reports to you. At a bare minimum you should strive to maintain daily communication with your outsourcing team, be it through online chat or over the phone. Going long periods of time without checking in with the developers puts too much distance between you and potential problems or questions that should require immediate attention.
Outsourcing When You Would Objectively Be Better Served By Hiring Local
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Outsourcing is best employed as a cost cutting strategy on routine, paint-by-numbers tasks that don’t require much unique corporate vision. Standard database programming and generic website design tasks are examples of work that can be safely and effectively outsourced. An important project that will form the backbone of your entire company and requires ideas and knowledge that only the top executives at your company possess should not be outsourced, as the language barrier and supervising difficulty can lead to a sub-standard finished product. Such projects are your company’s bread and butter, and the success of their development will likely determine the long-term success of your company. In-house workers who can be directly supervised and easily communicated with will get the job done faster and more efficiently than less-expensive off-shore workers.
Giving Your Outsourced Labor Too Much Responsibility
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Because of the various managerial problems outsourcing tends to pose, it is unwise to send projects with critical deadlines overseas. It is far easier to stay on top of an in-house team and motivate them than it is with a group of overseas workers. The sheer distance between your office and the outsourced labor organization is enough to cause problems in communication, which can lead to deadlines being blown or products being returned that are not up to expectations. In-house teams can be directly observed and errors can be spotted and fixed as they occur. In this way, outsourced labor is perhaps best used for non-critical, ancillary projects that can afford to come in late or be sent back for revision if necessary.
Paying Before Completion Of Tasks
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When working with outsourcing companies, you should always keep in mind that direct supervision is going to be a problem. Because of this, some unscrupulous overseas organizations will take full payment from your company and then abandon your project halfway through the deadline. As entrepreneurial writer Kathy Dobson warns, “one huge risk is that your trust in a third party to maintain a certain level of quality or quantity of whatever you’ve contracted to be created or delivered can be a hollow trust if your provider fails to deliver as promised.” When outsourcing companies leave you in the lurch, it is nearly impossible to take any sort of corrective action.
Overseas legal proceedings are impractical, and since you do not have a set of eyes in their country, it may be impossible to determine where the team has dispersed to and where your work-in-progress now resides. In order to guard against this common danger, avoid fully paying outsourced development teams before the successful completion of a task. Instead, try an installment system that keeps them wanting more as they progressively complete the project. Something like a third up front and two thirds at completion generally works quite well in keeping teams motivated and loyal to your deadline.
Ambiguous Instructions Given By You
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Do not assume your outsourcing team knows anything about your business, goals, history, or common practices. When giving instructions to this team, be as specific and detailed as possible, as language barriers and differences in culture can result in vastly different end-results than you had anticipated. Many a novice outsourcer has assumed more knowledge than his team possessed, and results have traditionally ranged from blown deadlines to products that look and feel far different than were originally conceived. Avoid such mistakes by being extremely clear about your expectations from your outsourced team.
Failing To Archive Works-In-Progress
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If your outsourced team is working on a software application, it is crucial to archive your various builds at the end of each work day. This is your best guard against the team abandoning your project for any reason, which happens commonly enough to be a problem worth preparing for. The best way to accomplish this is through the use of version control software, also known as a CVS system. CVS systems allow your your developers to upload all source code at the end of the day to a database controlled by you. In this way, you always have access to your teams latest updates to the code. If disaster strikes and your team disappears, you can show the various software versions to new programmers so that they can pick up where your outsourced team left off.
