(250) 516-6432 rob@robertscooke.com

Fixing the outsourcing blame game

We hear a lot from customers who are unhappy with the services they are receiving from their outsourcing service providers; and most customers place the blame squarely on the shoulders of their service providers. When we get in behind the common customer complaints, we almost always find that the fix involves customers and service providers working effectively together to reposition expectations and manage the contract.

Whenever the finger pointing starts it’s in the best interests of both parties to move quickly and find the fix. Here’s what we’ve found to help with the most common complaints we hear.

1. “It was never as good as it was when we did it ourselves”

Customers, especially those new to outsourcing, are often shocked at the initial implementation challenges and then find that ongoing costs and service quality are not what they anticipated. The problem is that there is rarely a credible baseline of service costs and performance that can be used to compare the before and after experience. So it becomes the customers perception of the outsourcers service performance versus when services were in-house. Even when SLA’s are being met or exceeded, customers identify areas where performance compares unfavourably to when services were provided in-house. Service providers have difficulty challenging these perceptions, because they don’t have the historical memory and their point of reference is the current SLA’s.  What results is a lingering air of dissatisfaction hanging over the relationship.

The Fix

The current contract has to be the common point of reference for both parties. Customers need to directly communicate where their current experience is not meeting their expectations (even if it isn’t in the contract).

Service providers need to understand the customer issue and accommodate where reasonable. In some cases adjustments to the contract may be needed.

2. “They don’t act like we would”

Organizations are rightly proud of their culture and brand in the marketplace.  The culture of an organization reflects its value system, what is, and is not important, and establishes norms of behaviour.   The culture and brand of any outsourcer will be different than their customers resulting in behaviours and responses to situation that will be different to that of their customers.  They are not wrong or inappropriate behaviours, they are just different.

The Fix

It is important that both the customer and service provider identify when they trip over a behaviour and/or value that surfaces a difference between their cultures.  Understanding and exploring these differences helps each party to understand these differences and agree on how they will manage them.  

3. “They haven’t put their best people on our account”

When customers first meet potential service providers they meet their ‘best’ people who are polished, experienced and who radiate excellence.  Then when the contract is signed the service customers meet the delivery team and they are often disappointed.

The Fix

Customers need to appreciate that those who will be doing the work and delivering services are not the sales team and recognize that the delivery team members bring different skills, knowledge and style.  Service providers need to be up front about who is the account team versus the delivery team and ensure there is a smooth and visible transition. If there is a performance issue with the delivery team that needs to be identified and addressed quickly.

4. “They are not doing it the right way”

When services are outsourced customers are turning over the management and delivery of services to another organization.  For members of the stay back team who were previously involved in the internal delivery of these services they will see services being delivered differently and be critical of the service provider performance.

The Fix

It is important for customers to make the shift from the “how” of delivering services to focus their attention on ensuring they are achieving their desired outcomes and that service outputs meet their contractual expectations.  That said, service providers need to provide sufficient level of assurance that appropriate risk management is in place to ensure service continuity.

4. “We never get the best practices we were promised”

Over and over we hear that service providers are not delivering on promised innovation.  When we probe into what is meant by innovation and how is this expectation defined in the contract, in most cases references to innovation expectations are vague at best, and open to various interpretation on both sides.   During the sales process service providers do a great job of highlighting their organizations best practices, research capability and development of new innovative technologies and solutions.  Unfortunately, when it comes down to the contract, most customers do not buy best practices or access to research or new innovation – they buy transactional service delivery.

The Fix

Both customers and service providers need to be clear on what is meant by innovation and what the expectations are for it during the period of the contract. Whatever the expectation is it must be clearly defined and documented in the contract.

About the Author: Rob Cooke is a leadership advisor, strategist and coach.  Drawing on a strong background in business and organizational development, Rob utilizes his extensive consulting experience to help leaders address emerging challenges, seize opportunities and execute approaches to achieve personal, leadership and business goals.

 

 Contact Rob Cooke for a free consultation  

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