Is your company looking to outsource but worried about the process? Are you new to the process of outsourcing and have many questions?
Many firms worry if they are even eligible for outsourcing! Let us break some myths and look at how you can get started on outsourcing.
Companies of all sizes in every industry benefit from emerging outsourcing services. A Clutch survey reveals that 37% of small companies outsourced at least one of the important business processes for growth and scaling.
The transition phase in outsourcing process can be a deciding factor for many companies on how to outsource and whom to outsource to. The transition phase involves moving processes and technology from the client’s environment to the outsourcing provider.
The Transition stage is pivotal for success. This phase is when you will encounter the greatest risks when working with an outsourcing provider. It is imperative for the transition process to be carefully mapped to include the supporting infrastructure for controlling the deliverables.
The Challenging Framework
What gives you the jitters while thinking of transitioning various processes?
Let us make a list –
- People’s behavior towards change – Fear of redundancy, fear of lower profiles /salaries, and loss of oversight are some of the factors to address.
- Maintaining the integrity of your services during the transition stage – It is important that all your processes are documented in a detailed manner, so that they can be easily explained to a new party. It is also important to notate all the essential details and information.
- Coordination – Transitions can be complex as it involves many processes, departments, teams, and procedures. That includes planning and coordinating all the activities during the transition phase.
- Budgeting – Avoiding or minimizing the variations against the estimated budget and the plan can be another challenge.
- Stakeholder Expectations – Sometimes there will be conflicting expectations between various stakeholders. How you manage those expectations could mean the difference between failure and success.
How an Efficient Partner Ensures Successful Transitioning
An efficient outsourcing partner can mitigate the risk with effective planning and implementation by focusing on the following basic aspects:
Objectives of Outsourcing
There should be clear objectives and management support for the change. The agreed upon plan should be executed with management oversight to ensure a smooth transition. This will assist in avoiding any risks, issues, or pushback from staff.
Outsourcing partners follow the balanced scorecard approach to build different views of the transition’s objectives. This approach answers the following questions from a financial and operational perspective:
- How to monitor and control transition costs.
- How to ensure the planned benefits of the transition.
- What performance measures are needed (SLAs & KPIs).
- What roles, skills, and competencies are required.
- How to add value in your outsourced processes.
- How to achieve operational excellence by leveraging core competencies and implementing best practices.
- How to ensure that business operations are not impacted during the transition.
Pre-planning Sessions – Due Diligence Phase
A transition is not a one way process. The client and the service provider will need to determine what activities and processes can be performed in the existing business model and which activities and processes need to be redesigned. This can be determined during the pre-planning sessions. These sessions will help to establish an effective transition and communications plan that is mutually agreed upon with identified roles and responsibilities. This will ensure that everyone has the same expectations concerning the services being outsourced and the delivery.
Knowledge Transfer Activity
A well-defined knowledge transfer plan is required to provide sufficient team training. This enables the team to learn your system processes and to understand the business requirements and how they impact business operations.
Effective Knowledge Transfer Methodology involves the following projects:
- Creating an environment that will enable the delivery of services
- Documenting the work processes for day-to-day activities.
- Creating workflows for every process
- Assist in managing the knowledge transfer to the outsourcing partner
Key people within the client’s company should be kept informed about the changes and how they will be affected. It is necessary to avoid the resistance to change, which can derail even the best of transition plans. The more transparent the process, the better it is. This allows procurement, HR, and all levels of management, to be involved and which allows for a smoother transition.
Identify the risks and contingencies
It is necessary to identify and evaluate the possible risks and issues. Then this allows both the client and the outsourcing company to develop contingency plans during the transition process. The transition management team prioritizes risks considering the severity, prepares a risk mitigation plan, and tracks the risk status at the stated stages.
Communication around quality
A detailed communication strategy is critical for a project to be successful. It should cover clear, timely communication to impacted groups in the company and external stakeholders. This helps them to understand the changes that are taking place and how these changes will improve their daily work. Project status meetings are necessary and are scheduled regularly. This makes stakeholders aware of all the relevant risks and issues. It is also important to ensure that all detailed project documentation is accessible at all times for all project team members.
ARDEM Solution - Transition Methodology
As a leading outsourcing solutions provider, ARDEM will ensure a successful transition by following the strategy below:
- Transition Start-Up
– Detailed transition plans
– Transition Team
– Transition Project Manager (PMO) put in place
- Transition Manage
– Knowledge Transfer
– Delivery environment ready
– Pilot Service Delivery Commencement
- Transition Exit
– Exit Criteria met
– Handover to Delivery
– Steady State Service
– Delivery Commencement
The following characteristics ensure a successful strategy:
- Proven Knowledge Transfer Process
– Tailored knowledge transfer plan, training schedules, and documentation.
- Retention Planning
– Retention plan for current staff
– Risk mitigation through the use of ARDEM’s Risk, Actions, and Issues Log (RAIL).
– Dedicated and experienced transition team.
- Seamless Transition
– Robust knowledge transfer process
– Rigorous change management and testing
– Plan around business-critical timelines
- Executive Support System
– Daily, Weekly, and Monthly Status Reviews for management oversight
Steps in ARDEM's Knowledge Transfer Methodology
ARDEM will perform the following activities for knowledge transfer:
- Change Assessment
The team receives and reviews the current process and training documentation leading to creation of “AS IS” process maps. The team then develops “TO BE” process maps to streamline and adds efficiencies in the processes by implementing software tools and automation.
- Knowledge Capture
It includes creating process maps, representing existing processes, roles, & responsibilities of the client, defining gaps analysis to agreed solutions and finalizing detailed sign-off.
- Knowledge Transfer
The team works on writing/verifying procedures, collecting customer insight, configuring workflow tools, creating process and system training material. The client will have a fully trained ARDEM delivery staff.
- Transition and stabilization
The service delivery from ARDEM service center is in line with agreed Service Levels.
- The client will have on-site support from the ARDEM delivery center after going live.
- There will be daily telephone conferences after going live.
- Process maps and desktop procedures will be validated after live operations experience with the availability of required updates.
Finally, the knowledge transfer process gets closed.
ARDEM understands that communication is the key to success. It establishes a communication structure that facilitates open discussions so that both parties can clearly understand each other’s perspectives around the potential resolution outcomes.
ARDEM provides Business Process Outsourcing and Business Process Automation Services to established companies to help them improve operational Efficiency and Reduce Costs. For more information please reach out to us at email@example.com or call us at 908-359-2600.