Often companies do not outsource because they feel foreboding, not because they have failed but just because they really do not know the process- it seems uncertain.
Well, the good news is that like every hustle, you can prepare well to mitigate risk. You can follow a process to focus on the right activities, be decisive and proactive in managing processes as outsourcing happens.
Even after you have made a decision to outsource, rather than wait and watch, you can choose to stay in the thick of things and make the most out of the resources.
Those who plan well, survive well.
On the same lines, if you plan things proactively, you make chances of your success higher. Reading this blog will prepare you well for your journey. But before we get to that let us understand why outsourcing fails.
While outsourcing is an evolved practice for most larger companies in the world, there is a higher failure rate among first-time founders, especially non-tech founders. We believe that combining the different reasons of failure as reported by founders, there are three major broad reasons
Failure to set up the right expectations at the start of the project, having unreasonable expectations or believing unrealistic outcomes is the number one reason for failure reported by founders.
When a vendor tells you that they can build an Uber-like app for 20K USD or when you think that you will just tell your idea in a meeting and the developer would start building it, these are all examples of wrong expectations.
If you start working with a team with who you were never able to communicate well or you chose to ignore the early warnings on communication just because someone was in the budget, well, you are going to fail in your outsourcing journey.
And communication not only means being able to speak the language but also the ability to understand and comprehend your requirements.
Outsourcing means working with someone who could be thousands of miles away and communication is the cornerstone of the whole initiative.
You can go as far as the process goes. Hence, the last and equally important cause of failure is lack of process or flawed process that breaks at the tipping point. If the process is not set, it often results in scope creeps, flawed products and confusion on the state of things.
An effective process keeps things in order and makes them predictable. It has clarity for team members to follow, checkpoints to track progress and a feedback loop to improve. Also, scalability can only be achieved on a strong process.
Understanding the above three mentioned risks, one can draw upon a plan to mitigate them by putting in the effort proactively to counter them. It is important to understand that the above-mentioned risks are true for in-house teams equally and hence, learning to solve the issue is key to success in product development and product management both with in-house as well as outsourced teams.
Here is a list of 9 things that you should do while you get ready for outsourcing-
Fig:- 9 things to do while you get ready for outsourcing
1. Learn the Tools to Monitor & Manage
When working with an outsourcing team, you constantly need to monitor their progress and operations to ensure timely and quality delivery of work. Along with this, you need to have proper management too so that there isn’t any form of misalignment within the collaboration.
For this, you need an understanding of the tools that you would be used to monitor and manage. Processes are only as effective as the tools used to manage them. If your team uses Jira, go through its tutorial to understand how to get your key metrics from it or to automate a report out of it. The same applies for Monday/Basecamp/Asana etc.
Similarly, learn about the different tools that you would use to monitor the performance of your product. Tools like Mixpanel, Google Analytics, SEMRush, Crashlytics etc are going to be used by you to monitor your product performance and recognize areas for improvement.
2. Vet the Team Well
The core of successful outsourcing is to find a good team. Learn about vetting teams, the questions to ask, the way to really figure out which team would be the fit for you and why is a key skill.
Markdown your priorities and the top skills you are looking for in a team and then create an assessment sheet that can be used to quantify your findings.
The major things to consider while vetting your team are
3. Getting the Right Contract
Contracts are the most important document when the time comes to use them. Hence it is wise to make sure that your contracts cover your assignment and case comprehensively.
Things to check out in the contract are-
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6. Commit for Long Term
For many companies and founders, outsourcing engagements are often planned as short-term gigs. This results in the inherent hurry to pass the coherent process in lieu of a long-term predictable process.
Considering your outsourcing engagements as a long-term initiative would make you take steps towards growing with the team, investing in nurturing leaders and building the culture. These initiatives would get you better results both in short term as well as the long term.
While the engagement could have started for a specific work, keep your goal to invest in people just like you would do for an in house team, because if you invest in people then only you get the best out of them, and that increases the work quality that you get which then means more chances of success for you.
If you already have long-term visibility, committing for the long term can help lower down costs and make your vendor too, further incentivized to put in their best efforts.
7. Set the Process
A process involves defining the day-to-day activities as well as the methods to pursue. The process would also involve defining the development process, the stages and activities in it. By understanding the software development lifecycle, you can better adjudge the team’s activities and anticipate what’s coming.
Additionally, learning about the project management practices such as Agile Scrum and the related terminologies can help a lot. Setting up the outsourcing process involves setting up the code repo, the cloud accounts, the DevOps pipeline and the system to share files and gather feedback as well.
For code repo, you can signup on GitHub or Bitbucket and invite developers. For cloud accounts signup on AWS/GCP/ Azure.
A typical development cycle consists of development, integration, testing and QA, staging, and finally production. You will have to sign up for staging and production servers. The staging server is for internal testing, data that your developers can make up and test hypothetical scenarios. The production server is when your platform is available for real users. It is important that both of these servers are set properly.
CI/CD pipeline can be set up which means code is continuously tested for integration (CI stands for Continuous integration) and continuously deployed to your repository as well as the production and staging servers.
If separate teams are involved, then also set up the process for their collaboration and manage dependencies.
At Mindbowser, we have created a custom dashboard to view logs, performance, security, and other major metrics.
8. Set Communication Cadence
Since communication forms the cornerstone of any successful outsourcing plan, I have chosen to mention it explicitly. Lack of communication can ruin the best of the actions, hence the teams should emphasize on setting up the communication cadence early into the process. Communication plan involves-
Get abreast with using videos for communication as well as recording videos for feedback and collaboration.
9. Setting Up a Quality Process
Quality is an area that is usually found as a pain point for outsourced contracts. Lack of quality often spirals into incessant rework and scope creep. As you set your outsourcing plan, understand the quality process followed by your vendor. Learn about making delivery predictable and quality as part of the process.
Push your vendor to follow development pipelines and automated code review so that recognizing and fixing errors is not left to chance.
You can also emphasize test-driven development and following a particular checklist and quality process. Further, keep working on the improvements and aligning with continuous feedback. You can learn about making software delivery predictable here.
While your team gets the work done, you can either yourself audit the work by using the tools as mentioned above or can get additional consultant/in-house developers to do the same on a timely basis.
This way there is a consistency to applying the best standards and necessary course correction wherever deemed fit. Make sure that the third-party audit is not a blocker to the team’s work but rather an enabler to get to good practices. Audits are usually important if you engage several freelancers for your work. In the case of agencies, most agencies would already have best practices that can be relied upon.
There is a lot of groundwork that you can do to make outsourcing work for you. Just like any battle, you can win or lose based on how well you prepare.
Just like any other initiative, making outsourcing effective comes down to managing risks and proactively solving them. Just follow the right set of things and you’ll find it a piece of cake to outsource effectively and yield its benefits.
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