What is Outsourcing?
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| Outsourcing is contracting with another company or person to do a particular function. Almost every organization outsources in some way. Typically, the function being outsourced is considered non-core to the business
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Why Outsource?
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| The OPD (Outsourced Product Development) option brings down the total cost of output, helps boost the bottom-line by availing of the best talent, and saves time for core activities. |
5 Key reasons why ISVs outsource product development:
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- Focus on core business needs and strengths: By outsourcing, you get more time to understand customer needs, innovate ideas for market-centric products, and build customer relationships
- Augment your Product Development expertise: You get the best of skills and talent to work for you
- Get enhanced Return on Technology Investment (ROTI): You save huge infrastructure and staff costs and in return you get a high quality product
- Speed up your time-to-market: Your product development partner ensures fast development and deployment
- To gain competitive advantage
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What should you Outsource?
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Decide what your needs are. You can opt to outsource any of the following service lines based on your requirements.
- Product Development
- Product Advancement
- Product Implementation
- Product Maintenance
- Product Testing
- Product Support
- Documentation
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Where to Begin?
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Learn
- Outsourcing concept
- Offshore Industry
- Pros and cons of offshore outsourcing
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Involve
- Educate all stakeholders
- Get a buy-in from the management team
- Get them to choose offshore outsourcing as a strategic tool/li>
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Identify
- Get offshore companies from the countries selected
- Evaluate based on company vision & values, clientele, language and technology match
- Shortlist good companies that you need to further evaluate
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Prepare
- Prepare an RFI questionnaire
- Send it to offshore vendors
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Evaluation Process
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Track record
- Service commitment
- Industry recognition & certifications
- Customer satisfaction
- Service level agreements offered
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Financial Stability
- Check financial statements
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Account Management
- How will your account be managed
- What Project Management tools are used?
- How available is the Account Manager
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Customer References
- Check with references on how satisfied they are
- What are the provider’s strengths
- What has been the quality of delivery
- How efficient they are in Project Management
- How does the provider deal with problems
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Do’s and Don’ts in outsourcing:
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Five do's of successful outsourcing
- Outsource the bottlenecks-those things that are really keeping you from growing your business profitably.
- Pick great partners. Check them out. Talk to their current customers.
- Once you outsource, your provider is part of your company; treat it that way.
- Demand excellence-this is what your provider does for a living. The way it does it should constantly amaze you.
- Outsourcing can scare employees. Get, and stay, ahead of the rumor mill through straightforward, honest communications.
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Six worst mistakes in outsourcing
- Not clearly defining the desired results and how they'll be measured.
- Not talking to a provider's current and former clients.
- Failing to consider the long-term relationship dynamics.
- Signing a standardized, multiyear contract.
- Not planning up front for how the relationship might end.
- Treating the provider as an outsider.
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