Outsourcing Red Flags

Industry News
A hand holding up a red flag

Outsourcing has been around for quite some time now. In fact, it is more normal for organizations to outsource now, rather than not.

Moreover, the global outsourcing industry is so big that in 2019, it has already amounted to $92.5 billion. The reason? There are a lot of benefits a company can get from outsourcing. 

According to Deloitte, businesses mainly outsource to save money and to focus on their core business.  Also, aside from those driving factors, there are other benefits such as access to technology, work productivity, efficiency, etcetera. 

Because the industry is so big, organizations have the privilege to choose which outsourcing services or firms work best for them. Also, if they want to save money, there are a lot to choose from. However, not all outsourcing firms are the same, and it pays to do your research before striking a deal with an outsourcing firm.

Moreover, to help you choose, here are some red flags you should watch out for in an outsourcing firm.

Poor communication in a conference room

Poor Communication 

Communication is a crucial factor in different types of relationships, be it personal or professional. Moreover, an effective outsourcing company has an efficient communication system. In fact, communication is a crucial factor in making your projects a success. 

If from the beginning, the outsourcing company already shows that it does not have an efficient communication system, then maybe it’s not a good decision to work with them.

A lying businessman making a deal

Lack of Transparency

Successful outsourcing relationship also runs on trust, and one can only trust someone if they show enough transparency on what they do. When a company is too secretive and won’t give you much information on what they do, or how they plan to execute the tasks you need, it may already be a red flag for you.  

Remember, you must also be part of your service provider’s plans when doing the tasks and projects you outsource.

A businessman avoiding giving a testimonial

Lack of Testimonial 

When reviewing an outsourcing firm, it is also a necessity to know what former clients say about them. 

A lack of testimonies can already be a sign that many companies won’t do business with some firms. 

A lack of testimony is more telling if a business has already been around the industry for quite a long time.