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Four Common Mistakes in Outsourcing

by: Sarah Joson

Monday, September 1, 2014 |

Business owners or operations managers are known to focus on costs when they come up with their next strategy. This is common amongst companies that want to maximize their budgets or donít have much to begin with. This is where outsourcing comes in handy.

Although the business tool has been around for many years, no organization has perfected the formula for a great outsourcing operation yet. An article posted at CFO.com shares the common mistakes committed by outsourcing buyers:

Lack of ownership
Most outsourcing partnerships end up in a cycle of overpromising and under delivering, resulting to endless arguments and discussions. Itís like parties are working against each other and not together - forgetting that they are playing for the same team.

Costs begin to cloud judgment
When outsourcing buyers look for providers, they tend to zero-in on affordable offerings and disregard the fine print. For instance, since it is affordable, you opt for the affordable team of customer service representatives without taking experience in to consideration. You may then end up shelling out more cash in training than hiring expensive, experienced ones.

Lack of trust
Buyers often feel that they can call the shots every time they meet with the providers. Most of them are also known to micromanage and hover over their suppliers. While they think this helps speed up the production, it actually disrupts the flow of a project because providers would have to set meetings, argue over the issues, and second guess their every move.

Lax management
Being too relaxed, on the other hand, can also bring problems. Buyers only have to find the right balance when it comes to governance and management. They can also create a collaborative environment wherein they give their ideas and providers translate these ideas into products and services.

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