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A Simple Guide to Outsourcing

Cost does not equal quality, and more team members is not always more efficient.

Jun 17, 2019

Books like "The 4-Hour Work Week" have helped perpetuate the idea that outsourcing is the key to success, it has been my experience that outsourcing has only one fundamental truth to it, which is: you get exactly what you ask for. Outsourcing is not simply a system of pay more to get higher quality or get a bigger team and get more done. Too many team members can cause confusion and reduce quality and then pace, and high costs never guarantee high quality. In a more general sense the reality is that you need to be aware of the product you're purchasing. Much like a car, you assume it will run, but if you expect to take a Kia Rio out for a high speed joy ride you'll promptly discover that you're not driving a sports car.

Outsourcing various aspects of a business whether large and small can increase productivity and improve customer satisfaction significantly. It also has the ability to reduce overhead costs and allow those savings to be passed onto the investor or customer of a business. However, outsourcing can also lead to numerous problems of quality control, organization and communication within a business and communication to the customer. This can leave a long lasting impression on a customer which can deter them from continuing to work with you, and worse yet share their bad experience losing you customers. So how do you begin to navigate the world of outsourcing? We're going to look at the example of outsourcing software development, a very common practice amongst various businesses large and small.

People over Products

Though the above comparison of a car can represent the output of the outsourced work, it certainly is not a good representation of the mindset you should have when looking into these relationships. Beginning the outsourcing process is more like hiring than buying a product, or service. After all you're likely going to want to continue working with this person or team over time rather than having to keep hiring for spot work. You need to be able to connect with this team or person. The risk of having third-party people or organizations controlling parts of your business is real. It's easier to put trust into those you're building a long term partnership with than those who you suspect want to build and run. Outsourcing companies that brag about working with hundreds of teams and have over a hundred people on their own team may not get you the personal connection that you want in your business. If your need is for a transactional relationship the large scale outsourcing companies can serve you well. If you're looking for a more personal connection, smaller teams have a higher chance of delivering that.

Agile over Waterfall

Like any great relationship it's all about consistent communication. Finding a great team to outsource to requires having constant check ins and reviews of the work to ensure that the goals are always in alignment. The less connected you are with an outsourcing company the less control you have over what's being done, and inevitably the less aware you become about the quality of the work being done. Companies that want to take your plans and return with a finished project after a month or more are not going to keep in alignment with your goals. This is called a waterfall approach and it looks good on paper because it has specific end dates and it makes it look like you're getting the best result with the least amount of effort. Modern development companies work in a more agile method. They will work with you keeping budgets and timelines in mind, while also maintaining direct communication consistently to ensure the project is on point. The outcome of this approach is often faster delivery of the project essentials while weeding out the 'nice to haves' and moving them to a next phase.

Quality over Quantity

When looking at various teams, it's not always about the numbers, at least sometimes its more about a few great work examples rather than many mediocre. Some teams will boast how they've worked with tens and hundreds of popular companies. Depending on your project it may be more valuable to find companies who have only worked with a few long term partnerships. Is your goal to have a simple transaction of building project X and then having another team maintain it? Are you having an outsource company build your project and then having your internal team maintain it? Do you plan on maintaining the project at all? These factors can impact your decision greatly when selecting an outsourcing team. If you want to maintain a long term relationship and have an outsource company build a project for you, then you're likely looking for high quality work rather than transactional work. Be aware of how fast the outsourcing companies want to call something done and move on. Some are far more concerned with their bottomline than building a long term successful relationship with you.

The Bottom Line

Fundamentally, when outsourcing anything, whether that's a portion of your business or simply a website you get exactly what you accept. If you find a team who is willing to output rapidly but the examples are mediocre do not expect your requests to be the exception. If you're looking for higher quality but have no budge on the deadline then don't expect the outsourced party to deliver their best craftsmanship. Lastly, hiring a team to create something you describe to them once with zero check-ins is never going to end up the way you wanted it to be. It's not about paying the highest amount for the highest quality, and its not about throwing bodies at a project. It's about developing a long term partnership with the outsource team and training them in what you're expecting. It's not necessarily hard, but it does take time and effort.

We're always open to developing long term partnerships with the right teams. If you're in need of outsourcing your digital work then let's talk!

By: Matt Lantz