Are you having trouble choosing the outsourcing model that best fits your business? Selecting an outsourcing scheme can be challenging, particularly when numerous factors must be considered.
As with many business decisions, strategic planning makes outsourcing partnerships successful. A 2023 Deloitte survey revealed that 88% of executives found outsourcing beneficial in reducing their overall costs by choosing an outsourcing model that worked best with their business.
Each model might benefit from varying talent pools, business proximity, and service capabilities. However, these benefits can be overshadowed by the factor that could make or break any business decision: cost.
In our previous CSCX blog, we discussed the various outsourcing models and provided a general overview, along with the pros and cons of each one. This article will focus on helping you decide which one works best for you through reliable decision frameworks.
Why Strategic Outsourcing Model Selection Drives Business Success
Nearshore, offshore, onshore—why does choosing the right model matter?
Aside from each model’s benefits in specific industries and business requirements, choosing the right model can significantly impact your business’s cost savings, quality of service, and growth in the future.
For business leaders, failing to choose the right outsourcing model can lead to numerous risks for your business. A lack of oversight on expenses can mean more cost overruns. Partnering with less reputable operations teams can significantly reduce service quality. Issues like communication barriers, poor quality control, and noncompliance with regulatory standards can become more prevalent and complex to manage.
Not choosing the right fit can also hinder you from rapidly scaling in line with dynamic industry demands. It can slow down your development and make it harder for you to stay competitive.
Ultimately, misalignment between BPO providers and companies can negatively affect your business objectives.
The Decision-Making Framework: A Step-by-Step Guide to Choosing the Right Outsourcing Model
Your success always depends on how careful you are in ensuring consistent alignment between your business and your outsourcing partner.
So, how do you ensure you take all the proper steps in the decision process? We put together a step-by-step framework to help you out. Here’s how:
Step 1: Define Business Priorities and Outsourcing Goals
Start by assessing your business’s needs and objectives. Prioritize your business functions according to their strategic importance. Identify functions you should focus on and those you can delegate to your prospective outsourcing partner.
Ask yourself the following questions:
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Will your outsourcing project follow a set timeline or a flexible one?
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What are the gaps in your in-house team’s skills, tools, and resources?
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Would you prefer direct control over your outsourced team or a collaborative management approach?
These are just some questions you can start with. Remember that this step is crucial for identifying your business’s core competencies, clarifying your specific outsourcing objectives, and assessing where your current in-house team may be lacking.
Step 2: Map Project Requirements to the Outsourcing Models
Once you have clearly defined your current team’s priorities, competencies, and gaps, it’s time to align them with your outsourcing options.
Do you want to prioritize greater accessibility, time zone alignment, and cultural compatibility? Consider going for an onshore or nearshore outsourcing model. Alternatively, would you prefer to focus on cost efficiency with greater operational independence? In that case, an offshore outsourcing model might be a better fit.
Also, take into consideration the timeline you have for the project. Some outsourcing models may fare better with long-term projects, while others may be more suitable for short-term ones.
Step 3: Use a Decision Matrix or Checklist
Consider using a decision matrix or checklist to help you make a clearer decision. This will help you determine which outsourcing model best aligns with your business.
Start by listing down critical factors you would consider. Score each outsourcing model based on its compatibility with key decision factors such as cost, ease of communication between teams, time zone similarity, cultural compatibility, or any other factor you deem fit.
Step 4: Evaluate Potential Vendors
Once it’s time to shortlist some outsourcing vendors, use a vendor checklist to guide the decision process. Having a checklist helps you evaluate which of your options meet (or exceed) your expectations.
Key considerations include industry experience, operational certifications, client feedback, communication practices, technological resources, compliance, and security protocols.
Step 5: Pilot Project or Phased Engagement
You’ve done all the careful evaluation, and now you’re all set to partner with a BPO vendor. What’s next?
It’s best to start things off on a smaller scale. Implementing a pilot project helps reduce risks and ensure your partner is fully aligned before proceeding to a full-scale outsourcing project. A pilot phase is the perfect time to lay down objectives and metrics, onboard and align your team, and evaluate project outcomes, among other best practices.
Globally Competitive Outsourcing Solutions
ClearSource is an innovation-driven outsourcing provider. We understand the operational pitfalls of varying business environments, so we always put our best foot forward. Our experience with a leading healthcare partner shows that efficient customer experiences and cost efficiency are not mutually exclusive.
By introducing advanced technology and support platforms, operational improvements, and training enhancements, we have increased Average Handle Times (AHTs) by 25% among many other remarkable improvements.
Need help with your decision framework? We have created a free ROI calculator to speed up your process.
Learn more about how our global operations drive call center optimization. Book a call with our team today!
