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By Tim Montgomery, President and CEO, TIMIT Solutions
Tim Montgomery, President and CEO, TIMIT Solutions
We hear so often that deciding what to outsource is simple. Outsource activities non-core to your business. So how do you do it? Outsourcing must be about leveraging your outsource partner’s core business that is not part of your core business efficiently and effectively.
The same metrics and measures used to track your business goals must be used for your partner. The reason to outsource is still largely to drive efficiencies: higher quality delivery, lower costs, and more responsive service. It’s also about effectiveness in terms of positive impact on your business; whether that is growth, market share or profit margins.
In addition to metrics and measures, your partner must also share in the risk as part of how they earn their reward. Gone are the days of “you save me this much on my labor costs and we’re good”. If your partner is not aligned and measurably able to prove they are helping you drive to your business goals then they are an old-school vendor, not a partner.
I envision an effective business-partner relationship as the partner “owning” -- being responsible for the piece of your pie that is not core to your business. An ineffective model would be letting them go off somewhere to eat your slice of pie at your expense!
To this end include these key elements in your business-partner model that many leave out:
These are concepts for sure. All the processes, SOPs, tools and models that can be used to help manage the delivery of outsourced services are already available. There is nothing strikingly new, except that advances in technology and social media have made them exponentially more effective and easy to use. My point is that its more about how you integrate the non-core you outsource to remain an effective and efficient part of what is core to operating your business.
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