Cooperating with an outsourcing agency is one of the popular and important solutions in all industries. Selecting the right outsourcing partner can be a headache. Everyone would say good words that you may want to hear, but not everyone can satisfy you in every room of the project. Mobytelab Solution would like to share some tips which can help individuals and businesses select the best outsourcing provider. Before signing a contract with any vendor, do interviews to make sure they have the qualifications that Mobytelab will note below.

1. Outsourcing agency market

1.1 Outsourcing

1.1.1 What is outsourcing?

Outsourcing is cooperating with a third party, an outsourcing service provider to support the work. The company can partner with an individual, a team, or an organization. Outsourcing provides many solutions to help companies streamline workflow, focus on their business functions and core goals, utilize existing resources, save time and money, expand the scale, and achieve their mission.

Advantages of outsourcing:

• Focus on core business.
• Access to a larger talent pool.
• Cost-effectiveness.
• Resource maximization.
• Less risk.

Disadvantages of outsourcing:

• Lacks of control.
• Management difficulties.
• Communication issues.
• Problem with quality.
• Passive in some cases.

To find out the reason why you need to outsource, check this blog: Why do I Need to Outsource My Project? To find out the differences between outsourcing and in-house, check this blog: What are the Differences Between Outsourcing and In-House?

1.1.2 Outsourcing models

Outsourcing has been divided into many different models.

• Based on the relationship, outsourcing has three models: Staff augmentation model, Dedicated development team model (outsourcing team), and Project-based model (outsourced projects).
• Based on the pricing, outsourcing has four models: Fixed price (FP) model, Time and materials (T&M) model, Incentive-based model, and Shared risk-reward model.
• Based on the location, outsourcing has five models: onsite outsourcing, offshore outsourcing, nearshore outsourcing, onshore outsourcing, and multisource outsourcing.

Depending on your outsourcing needs, you consider and choose the suitable outsourcing model.

To find out three models of outsourcing include offshore, nearshore, onshore, check this blog: Offshore vs Nearshore vs Onshore: What are The Differences?

1.2 Outsourcing agency

1.2.1 What is an agency?

An agency is an important part of every outsourcing solution. An agency might be a third party, an outsourcing vendor, a consultancy firm, a BPO company, a business or organization that provides specific services or solutions, cooperates with other individuals or organizations, implements contracts to support the business.

Advantages of Agency:

• Cost-effectiveness.
• Professional experience.
• Easy to find.
• Flexibility.

Disadvantages of Agency:

• Difficult to control.
• Missed information.
• Not onsite.
• Secure risk.

1.2.2 Type of Outsourcing agency

Outsourcing agencies are divided by the service or solution that they offer. Outsourcing solutions will support front and back-office operations, management systems in many different fields and industries. For example, law, recruitment, call center, advertising, insurance, finance and accounting, data entry, information technology, business process outsourcing (BPO)… Each type of outsourcing agency has the specific ability, experience, and resources to meet client’s demands.

1.3 Some statistics about the outsourcing agency

Outsourcing is one of the fastest-growing industries around the world because of outsourcing needs. Some statistics show the development of outsourcing and agency.

• According to Statista, in 2019, the global outsourcing market was worth $92.5 billion. The revenue of the global business process outsourcing (BPO) was $66.5 billion.
• According to fortunly.com, almost 54% of all companies use third-party support teams to connect with customers. About 300,000 jobs get outsourced out of the US each year.
• According to Clutch’s 2019 Small Business BPO Survey, the most commonly outsourced services are accounting (37%), IT services (37%), and digital marketing (34%).
• According to The 2019 Kearney Global Services Location Index, the top 10 countries with the strongest underlying fundamentals to potentially deliver IT, BPO, and voice services were India, China, Malaysia, Indonesia, Vietnam, the United States, Thailand, the United Kingdom, and Brazil and the Philippines.
• According to capitalcounselor.com, 64% of leading companies have chosen RPA (robotic process automation) as a digital enabler.

To find out about the IT outsourcing industry in the world, check this blog: A Report for Global Software Outsourcing Market To find out the IT outsourcing market in Vietnam, check this blog: [A Report for Software Outsourcing Market in Vietnam(link)

2. 5 qualifications to consider to choose the best agency

2.1 Relevant expertise

2.1.1 The importance

Each company has different expertise and abilities. The expertise of an outsource provider can directly impact internally your organization’s productivity. To meet your needs, you should ensure that they’re capable of providing high-quality work and have the resources that are going to contribute to your business. Their skills should be examined carefully with the same attention to detail as for your in-house employees. You will pay for their services, so you have the right to ensure that they can provide you with the best results that you aim for.

In many cases, you may prefer people who are professionals in their markets. They can provide you with helpful guidelines and advice if something bad ever happens. These people are sure not to come cheap, but they’re worth the investment.

2.1.2 How to evaluate

To determine the expertise of any agency, you can make an appointment with an outsourcing provider to discuss this. The conversation makes sure of their true ability. You can evaluate their core competencies via the quality, the review, or the rating of deliverables to all projects that they offered in the past. The responsibility of outsourcing companies is to provide a lot of information, proof, or example of related previous work to affirm their expertise. A list of experts and staffing with highly skilled might also be good proof.

Besides, you can refer to other companies that worked with this provider. Case studies and clients’ references can help determine the ability of the service providers. You can also check out the provider’s rating and clients’ reviews on big and reputation review sites, forums.

2.2 Experiences

2.2.1 The importance

Any agency has large experience in the specific industry, this agency has a big competitive advantage in the market. Choosing and working with this provider allows you to take advantage of the benefits of outsourcing solutions.

The outsourcing providers that offer many high-quality services for a long time will have more experience in many different projects, different technology, different clients, and different countries. This diversity helps the provider to flexibly meet your demands and get the best achievement quickly.

When outsourcing, to avoid risks and slow progress, give priority to providers who have done the relevant project before. Having much experience to put things in the right way and tons of solutions to common problems. It's a good choice.

2.2.2 How to evaluate

Seniority refers to the number of years that the company offers outsourcing services and solutions in one specific industry. You need to answer the question of how long the company has been in business, how many long-term clients it has, and how many projects are released? More information about candidates partly helps you check their experience. You can also check by asking their existing clients, request references, evaluate the efficiencies of sample work, and have a detailed record of their experience and work history to date. High customer satisfaction is necessary to trust with their experience.

2.3 Competitive pricing

2.3.1 The importance

Companies outsource to a third party, the most important advantage is cost-savings. By outsourcing, you can save a lot of money, time, and effort. A competitive cost allows you to minimize the expenses, effectively utilize all resources to get the highest productivity and expectation.

The price will match the quality, so it's not necessary to choose an outsourcing company that offers the lowest price. An outsourcing partner that offers distinguished service at an affordable price will always be the best choice.

2.3.2 How to evaluate

You need to research the outsourcing market in the industry that your business activities in. You will have a general understanding of the services offered, demand, and pricing. The comprehensive picture shows you the opportunities to approach providers with high quality at a reasonable payable. You also need to do surveys to gather information about the pricing and the service quality of potential outsourcing firms that meet your business needs. The result of the survey helps you compare and choose the best candidate.

2.4 Creative and flexible

2.4.1 The importance

Nowadays, every field and industry is growing and changing rapidly. Each day, more and more new technology and knowledge appear that requires any person-related need to update and keep with the trend. To meet the quick change, you need to be sure that the outsourcing services partners are willing to change and go in multiple directions at once if necessary. Put aside outsourcing companies that are still convinced that one side of anything fits everything. It’s so out-of-fashion. Everything needs to be creative and flexible to suit the precise and very exacting needs of each customer.

Projects must be developed and adapted to changing market demands. It’s important to choose an outsourcing partner that can support your company’s short-term and long-term plans.

2.4.2 How to evaluate

If you want to evaluate the creativity and flexibility of outsourcing vendors, the best way is to check the development process, progress, and the result of the previous projects. Any project always meets some problems and difficulties. The most important thing is how the outsourcing company resolves the problem, how long it takes, and after that what the achievement is. The creative and suitable ways performed by providers allow you to check their real ability in any case, especially difficult cases that require a lot of effort.

You can also give hypothetical situations and ask your candidate to suggest solutions. Require to answer some questions about new outsourcing trends and evaluate their competitors in recent times. From there, you evaluate their scalability and suitability to make the outsourcing decisions.

2.5 Reliability

2.5.1 The importance

Choosing an agency is like choosing a partner. And “partner” means they understand that you’ve been working, and are reliable. Even if they’re considering outsourcing, they’re still an important part of your project. So it’s essential to have a good harmony between you and your outsourcing partner to make sure that the workflow runs smoothly and achieves business goals.

2.5.2 How to evaluate

When contracting an outsourcing firm, you need to focus on detailed contracts and the firm’s policies and regulations. Understanding the overview of the company’s policies helps you reject the risk of unsuitable services and solutions. You can confirm the reliability of your candidates via reference checks about customer experience. The high trust from past partners, especially big well-known partners, and seniority in particular fields offer higher reliability.

Besides that, you need to build a close outsourcing relationship by organizing more and more outsourcing activities and setting a proper management vendor plan. Through virtual assistants such as management plans, you easily ensure and maintain confidentiality to increase your competitive edge and business value.

Conclusion

There are sure to be more things to define which outsource partner should you choose but these qualifications above are to remember to step on the successful road.

At Mobytelab, we understand that outsourcing is now not only intended to save you time and effort but also to contribute to the success and growth of your business. So it’s worth taking time and care when selecting the right candidates or agencies and building a strategic outsourcing plan that will be responsible for the achievement of your business.