How to Screw up IT Outsourcing in 10 Easy Steps

Hello!

2021 has definitely changed the course of actions in all industries, and there is no denying that. Companies cut their staff and started looking for an alternative, cheaper workforce that could save the day. 

28% of the UK-based companies reported their attempt to look for IT outsourcing opportunities; in the US, 19.4% of companies have already increased their outsourcing cooperation. 

With relatively high numbers, small and mid-size businesses begin considering the idea while staying cautious of the consequences. This article focuses on the bad practices of IT staff outsourcing to help with a more seamless and painless transition for businesses of all sizes.

Why Consider IT Staff Outsourcing?

IT outsourcing bears multiple benefits, and some of them you will find below. But among those, there is a great opportunity to find the perfect candidates across the world and begin working with them without the need to reinvent your whole processes. 

Considering that due to the pandemic, about 40% of full-time workers switched to telework permanently, you will not have a problem with one more ordinary team, regardless of their location.

Besides that, most often, outsourcing helps to:

1. Lower operational and labor costs
2. Focus on the core processes while getting outsourced IT support services
3. Free up internal talents
4. Get access to specialists in the niche services
5. Reorganize and leverage buffer fund
6. Delegate complex processes that are difficult and expensive to manage
7. Mitigate risks
8. Expand in the new markets
9. Speed up all IT processes
10. Cover more time zones, for instance, hiring IT outsourcing companies in Singapore while working from the UK

Top 10 Mistakes in IT Outsourcing

Every new skill (and outsourcing is one of them) needs a number of mistakes to be made before it could be perfected. One of the top mistakes that can screw up everything is the lack of proper questions because asking the right question means having half of the answer. 

Below you can find the most common mistakes companies make with IT staff outsourcing and the questions that will help you avoid them.

1. Setting no goals

A business cannot expand if it doesn’t ask the question ‘how’; a business cannot get a new client without deciding to do so. Goals turn into plans, and plans turn into reality. 

So first and foremost in the efficient IT staff outsourcing is to set the goal to outsource and understand why you need to.

Here are a couple of questions to help you grasp the idea of ‘why you need to outsource’:

1. Do you have an overloaded team?
2. Have you just caught a new client in a need to develop a new feature?
3. Will you integrate the external team into your daily operations? Or do you want to give them a separate task?
4. Do you want to save time and money on hiring an in-house expert?

Without a goal(s) you risk hiring a completely wrong team who cannot fulfill your expectations.

2. Ignoring the Partner’s Retention Rate

High turnaround of the outsourcing staff is always a mess. They need to constantly re-train their team and will eventually fall behind on the schedule, failing your projects. 

Most often, companies with a smaller retainer would have lower retention rates.

To check it, you read about the company and check reviews from their previous customers, or you can ask them directly:

1. Will the IT outsourcing company provide a fixed team for your business?
2. Will the vendor inform you if the team working on your project changes?
3. Will you have to re-train the new members should they occur?

In a perfect world, you should hire a company that would guarantee a fixed group of people for your project. In reality, try at least to ensure that the vendor takes care of any further onboarding procedures for the new members and guarantees no impact on the deliverables.

3. Forgetting about the Rules

Once your goals are set, and a candidate is selected, you need to set up your expectations and a clear way of communication. Failure to define instructions, processes, results, and overall rules of cooperation will lead to no results at all. 

For instance, IT outsourcing companies in Singapore may have a different set of preferred tools than your office in the US which might result in different time frames, inconsistency of the code, missed deadlines, and low delivered results.

Here are a few questions to consider:

1. How often will you communicate with the outsourcing company?
2. What channel of communication is preferable (software, format, timing)?
3. How and how often will the outsourced team report on the progress?
4. How will you share your feedback?
5. What are the deadlines and schedule of services?
6. How will the billing be processed?

4. Hiding Essential Information

Yes, you cannot disclose sensitive data or give your outsourcing team an unlimited access to all systems in your business. This is too much of a risk. 

But at the same time, you cannot make the outsourcers get back to you to approve every action they make; you also cannot hide the bigger picture from them. 

Failure to provide essential information about their tasks will definitely cost you a lot of time and much headache when the time for real work comes. To avoid it, set the following questions:

1. Do you need any further information?
2. Were all internal processes and accesses related to this task shared with the outsourced team?
3. Who is in charge to ensure all accesses are safe yet shared?

Remember to always have an internal in-house person following on the security of the outsourced operations. Caution is the parent of safety.

5. Playing Hard on Terms and Conditions

You do need to be cautious and careful when sharing your internal information outside of the company. However, extremely restricted terms of cooperation can scare away a great team. 

Terms and conditions of any cooperation must protect both sides from any scams, but this does not mean that they need to strictly define every step of the outsourcers and threaten with huge fines. Be nice, and the partner will be nice back.

1. What exactly do you need to protect in this cooperation?
2. What harm can be done, and how to avoid it?

6. Overlooking the Mismatches

Mismatches can be of different nature: personal, cultural, technical, or procedural. The external team might be using a different programming language, has an alternative understanding of communication, or simply work in a mismatching time zone. 

Of course, some IT outsourcing companies in Singapore can extend your working hours and hence let your business work almost 24/7; however, consider that you might have to stay awake late at night for a meeting with this vendor.

Ask yourself:

1. Is this a reliable team or I will have to control them during their shift?
2. Do we have a matching set of technical tools and skills?
3. How much time will we spend to adapt?
4. Are there cultural differences that do not suit my team?

7. Neglecting Transition Procedures

The exact moment when you hand over accesses, provide training on your processes, and generally onboard IT outsourcing services is the most important in the whole cooperation. 

It takes careful training, planning, and step-by-step procedures. Without an efficient mechanism, a business is likely to suffer delays and even loss of benefits, time, and stakeholders besides major workflow disruption. 

1. Did you plan overlapping staff from both sides for the transitional period?
2. Do you have a guide on knowledge transferring?
3. Are there contingency plans ready?
4. Is there an incident management team for emergencies?

8. Overlooking Management for Outsourced IT Support Services

Outsourcing providers join your teams to help with daily processes, but they still need to have guidance and management coming from your company. Outsourcing forces are hands, but you remain the brain of the operations. 

Of course, vendors will have their own hierarchy in place, but they cannot replace your supervision. Failure to control and regulate the cooperation from within bears risks of missed goals and defocusing of all the processes.

Two questions in this respect:

1. Were new supervisors assigned to control the transition and day-to-day cooperation with the vendor?
2. Are your current managers prepared for the increased number of staff under their charge?

Let the outsourcing teamwork on the day-to-day tasks but always leave larger decisions determined by your own managers. 

9. Micromanaging After Transition

All outsourced IT support services do need supervision, as stated above, but you cannot keep controlling every single step of your IT processes. 

If you cannot stop it, then outsourcing makes no sense since your team will continue to spend lots of time to double-check every element of the vendor’s help. 

It is better to spend more time finding the right MSP than to continue controlling everything all the time. And there are no questions that can help you overcome this temptation, just stop it.

10. Outsourcing the Wrong Processes

There are particular sets of data and processes that need to stay in-house in order to avoid security breaches, reputational losses, legal problems, and even complete collapse of the systems. 

It is highly beneficial to outsource part of your internal process but not to share a whole piece of business with the vendor.

Here are questions to avoid outsourcing the wrong processes:

1. Is this a customer-facing process?
2. If a vendor fails to deliver its part, will there be a direct impact on end-customers?
3. Is sensitive personal data handled by the outsourcing company? (tip: it should not)
4. Do you have an internal supervisor for the outsourcing staff? 

And to close up the failing strategies, there are two more crucial elements that will screw up your whole experience of delegating processes: an abundance of providers and lack of exit strategy.

IT outsourcing bears the great relief of not having to perform every minor task in-house; but if you outsource most of your processes, it might be a challenge to synchronize all the vendors and set them up on the right track. 

Do not also neglect the recruiting process for every new external team while getting your IT outsourcing companies in Singapore, India, Ukraine, Brazil, etc. 

All this may add up to more troubles and complications than the bearing benefits, so it is better to stick to 2-3 vendors coming at least from the same region.

No matter how great the process might go, there will be time to let go of the external team. In this case, the lack of a procedural, legal, and agreed-upon system of existing cooperation can turn into a nightmare. You have to ensure that you close all accounts, take away all their accesses, etc. Always plan a way out before things go south. 

Conclusion

IT staff outsourcing bears multiple benefits for any IT company. It can significantly relieve the workload of a team and introduce additional benefits to the day-to-day operation. 

But all this is possible only with proper planning and careful approach. Remember that you will make mistakes while hiring a new IT outsourcing team since flaws are inevitable in every process. 

But a small slip is different from a major security breach. So profit from the mistakes mentioned in this article, and get a smoother transition for your business.

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