Guide

Outsourcing

Choose an outsourcing partner

Outsourcing is about creating a successful partnership. Choosing a company to outsource to is very different from choosing an ordinary supplier. You're embarking on a long-term, contractual relationship, so take time to carefully examine potential service providers.

Credentials and track record

Ask yourself:

  • Does the provider have a track record of service commitment?
  • Has it been recognised within its own industry?
  • Does it track customer satisfaction levels?
  • Is the business expanding?
  • How good are the service level agreements it offers?

See service level agreements.

Customer references

Find out:

  • who the provider's existing customers are
  • how satisfied their customers are
  • what the provider's strengths are
  • how they deal with problems

To answer these queries, try to speak to several existing customers with an industry profile similar to yours.

Current and future capabilities

Visit each potential service provider. Look at the working environment and ask about staff retention and turnover. Check their IT systems and equipment, management processes and quality assurance procedures. Is their company known for driving innovation and keeping up with emerging technologies?

Financial stability

Check that your potential provider is financially stable. If it is a limited company, get copies of its recent accounts, ask for banker's references and consider getting a report from a credit checking agency.

Ask your potential service provider if they plan to subcontract any of your work and apply the same checks to any subcontractors.

Communication and cultural discrepancies

If you choose to outsource to a company outside the UK, remember that distance and time zone differences will make communication and control more difficult.

Language barriers and different business cultures can also present problems. You may also need to allow for exchange rate fluctuations in your costings.

Ability to collaborate and innovate

You will want someone who can manage change when necessary, be resourceful in meeting your goals and requirements, and willing to commit to building a strong relationship. Relationship management will be critical in outsourcing. How will your relationship be managed and how good - and available - is your relationship manager?

Download an outsourcing relationship management guide (PDF, 292K)

Search the outsourcing supplier directory.