When outsourcing goes wrong and how you can avoid it - When outsourcing goes wrong and how you can avoid it
WHEN OUTSOURCING GOES WRONG AND HOW YOU CAN AVOID IT
14th October 2016
We’ve all experienced the breakdown of a relationship, which up until that point had been working so well. It might have been someone at work, a supplier, a family member, a partner, and find ourselves asking “What was it that changed?”.
I am often asked what it is that happens when outsourcing goes wrong, and my first instinct is always that it is the absence of partnership, which can be felt in a number of different ways.
How does it happen? From my experience there are a number of factors that contribute to the success of an outsourcing relationship and the absence of these should act as warning signals that the time has come to look for a new provider.
1. Ensuring realistic expectations from the outset
Transition and transform are two terms that can be used in outsourcing in a number of ways. Ensuring a mutual understanding of what is being outsourced and what should happen after outsourcing has taken place is key to starting any new relationship on the right footing.
Many organisations enter into outsourcing trying to fix a problem, yet aren’t open about the nature of the problem or restrict their ability to fix the problem by resisting change. Imagine a situation where your assessment process was broken. You were interviewing far too many people and hiring employees who subsequently didn’t perform or stay. You decide to outsource the issue.
After the services are transitioned to the new provider they come up with plan after plan which would address these issues. Yet each involves changing the process, and you resist the change.
Agreeing a clear service charter during the initial contracting phase, that outlines the responsibilities of the outsourcer to deliver and providing them complete control over the transformation plan, avoids all of the potential challenges outlined here. Or at the very least can serve to highlight where the issues lie.
2. Providing your partner with a seat at the table
The easiest way of ensuring that your outsourcing partner feels an integral part of your team is to give their account lead a seat at the management table. This provides open access to the talent conversations within your organisation, sharing your objectives to enable your partner to understand your priorities and areas of focus. It can also support the building of professional relationships across your leadership team so the outsourced partner can operate as an extension of your own team and be more effective.
This level of participation provides your partner with an ability to understand your business needs directly and make appropriate recommendations as to how they can address your challenges that you may not have realised they could support.
Contrast that with an arrangement where your partner isn’t allowed access to your leadership team and is only able to work under instruction based on what you tell them. This creates a dependency on you, adding to your workload and restricting the areas you can improve. Constraining a partner in this way is a recipe for disaster over time.
3. Keeping the services relevant
“Change is the only constant” is a phrase ever more relevant in today’s market. Working with a supplier that continually looks for new and improved ways to deliver services, proactively introduces them to existing clients, embraces relevant and valuable developments in the technology landscape and adapts to changes in the client organisation and marketplace is critically important.
I am frequently having conversations with disenfranchised buyers and end users of MSP and RPO services who haven’t seen a perceptible change in what they receive since their programmes went live. Contrast this with the significant changes to technology and how services are accessed across their personal consumer lives and this is pretty surprising. Some of this is can be attributed to the core technology platforms we use to deliver services within an MSP programme, although most major VMS platforms are undergoing a programme of change for the positive. However, the main concern here is the lack of a proactive service personality embodied by the programme team and the absence of business processes provided by the MSP organisation to embed continuous improvement into the programme governance.
This results in services that feel increasingly stale over time, and the injection of new leadership, a new supplier, fresh thoughts and ideas is often what is needed.
What you can do about it
If you are suffering from one, or all, of these symptoms then it is time to start talking to other potential partners in the market to understand how they deliver the core services you require, and how they create healthy, long term partnerships with their existing clients.
My advice is to make certain that you spend time exploring each provider in detail. Ask to see evidence of the following areas within their programmes, to ensure you make the right decision:
1. A track record in successful delivery of business as usual and project deliverables
2. Programme leaders capable of adding value to your leadership team
3. A systematic approach to the ongoing development of the MSP programme, which is well supported by centralised subject matter experts
Getting this right will be key to the future success of your programme, so if these comments resonate with you get in touch to find out how we could re-energise your programme.
EMEA Managing Director and Global Head of Sales, Solutions and Innovation, Hays Talent Solutions
Jonathan is the EMEA Managing Director and Global Head of Sales, Solution and Innovation for Hays Talent Solutions, having joined Hays in 2011. Previous roles held at Hays included Client Director, Service Delivery Director and Head of Sales for the UK. He is now responsible for leading the approach to engaging and securing new clients and to ensuring that the products and services offered by Hays Talent Solutions continue to meet the changing needs of our global, regional and local customers. For more information about Hays Talent Solutions, visit our website.
Prior to joining Hays, and after completing his Masters in Philosophy and Management, Jon worked in the RPO and MSP sector for 10 years with a range of Financial Services, Public Sector, IT & Telecommunications, and Insurance clients in Sales and Operations Director roles.