Niyamath Parveez

Outsourcing is done for increasing profit margins. That is how things should be. This simple condition can be fulfilled by paying service providers wisely. When a company tries to outsource one or more of its services, there is no lack in the number of service providers jumping at the opportunity. But are they really able to provide cost-effective services? This is the first question that should be answered before the deal is sealed between the company and the service provider.

Many outsourcing service providers boast of being able to provide superior service at close-to-ground rates. While this may be true for certain providers, for most it is far from the truth. Service providers with less than efficient employees may end up eating into the profits of the outsourcer in the long run. Not a good scenario, and certainly a situation that can be avoided by screening the provider carefully prior to confirming the deal.

So, what can outsourcers do to ensure that they get their money’s worth from the providers? There are no fixed rules to this; the methods vary greatly between outsourcers. Some put stress on the overall quality of service that the provider maintains, while others look at the list of the value added services that the provider is ready to provide for free. But some common points seem to be there at all times, such as:

1. Rewarding for savings – One of the best things to do is to add a clause to the contract that the provider will get bonuses depending on the savings it can help the outsourcer to make. This is a way of making sure that the provider works hard towards providing quality service. For instance, a popular firewall manufacturer a few years back outsourced its process of launching a help site for its customers. The manufacturer made it very clear to the provider that the payment would be more if the quality of service was good. Within a couple months, calls for support made to the call center of the manufacturer were cut down by as much as 15%. This is the kind of service that most outsourcers should expect and insist on.

1. Making them do the hard work – Outsourcing service providers should do the job as a whole, not in parts. The internal divisions of the outsourcer should not have to do anything to plug holes left by the provider. The provider’s fees should be calculated based on the complete job, not segment-wise. That way the provider will be bound to provide the complete service in order to expect any payment. In the example mentioned in point no. 1, the provider did the hosting of the website, designed the entire interactive site for the outsourcer’s customers and even provided demo of the entire system to the outsourcer.

These two steps can help an outsourcer choose the perfect provider for the services that it has outsourced. Only through maintaining screenings like this can an outsourcer hope to get superior quality, cost-effective service.