Developing and maintaining an effective

global relationship model—keeping in mind what it is and what it isn’t intended to do—is a major contributor to offshoring success.

Best Practices For Global Sourcing Managers

Once the company designs and builds an offshore relationship model tailored to its particular needs, it is faced with the daily operational challenges of a distributed “organization.” Through experience, we have identified a variety of best practices that I’d like to share. Recently, I had a conversation with a client who indicated they were continuing to transition more customer care work to their provider in the Philippines. Since we are accustomed to hearing offshoring “war stories,” I was anxious to hear details on what appeared to be an in-progress offshoring success story, and to discover which best practices supported this positive outcome.

Best Practice #1: Communicate in a context understandable to a different culture. When your provider’s delivery team is based in your country, it tends to easily grasp the “context” behind established performance goals, like improved customer service, faster response times and better efficiency metrics. But this seemingly innate understanding is often absent when your delivery team is from a culture in which priorities, communications practices, and reference points are considerably different.

In order to achieve mutually beneficial results from the offshoring agreement, you must help offshore providers understand the context and the “why” of your needs and requirements so they will be better equipped to serve you. This can be a considerable challenge, but it can be accomplished by learning about the culture of the delivery team and perhaps using examples, analogies, or metaphors that resonate with individuals from that culture when explaining the issues.

Best Practice #2: Set clear, mutually agreed-upon goals and timelines. When you identify an area that requires improvement, you must set clear, achievable, mutually agreed-upon goals and well-defined timelines. The emphasis must be on performance and the human elements required for achieving the goals. For example, I had a client who needed to drop e-mail handle times by three to four minutes to meet its company’s goals and stay within the budget of the agreement. The global-sourcing manager recognized that to achieve this goal, he had to manage a balance between human performance factors and the contractual service-level metrics. Thus, they got together as a team, set clear goals around the e-mail handle times that all parties agreed were achievable, and created action plans to meet them. By doing so, they met their goal within their timeline and without increasing the service provider’s costs. And, by creating an environment in which the service provider was allowed to continuously improve, they were able to drop e-mail handle times to its current performance of a minute lower than the original goal and maintain that performance trend over the long term.

Best Practice #3: Work together as partners. You hear this time and again, but when your delivery team is 12 time zones away, it can be a challenge. But constant daily communication to discuss points and action plans in order to reach your goals is critical to success. In outsourcing, you must work through issues—such as improving customer satisfaction, or implementing a new corporate strategy—together. While SLAs are the foundation of client expectations, they alone cannot drive real performance or customer satisfaction. The most successful offshoring relationships approach each challenge as a unified team, not in an “us vs. them” manner. When working with different cultures over long distances, developing this mentality requires much more effort than in an onshore engagement. This approach makes the offshore group a trusted, integral part of the team, and enables its success.

Best Practice #4: Give recognition to a job well done. In an offshore setting, as in any outsourcing arrangement, the service provider team needs to understand when it has done a good job. This not only breeds the right behavior, but motivates the team to work harder. Understanding this, our client had its CEO present a recognition award to the provider team that met, and then exceeded, the e-mail handle-time expectations.

Best Practice #5: Face-to-face is worth its weight in gold. Frequent trips to your offshore providers’ site are requisite. These are not occasional social visits. Rather, they are a normal part of the sourcing manager’s routine. The delivery team needs to see the client and understand that the client is attentive and appreciative of the details. Solving day-to-day problems, and working through new strategies and plans together is paramount to getting the best out of the relationship. Remember, success results from teamwork and a consistently maintained relationship with your provider, and that cannot be accomplished via phone and e-mail alone.

The principles of an effective relationship management and operating organization will usually encompass the elements of strategic, tactical, and day-to-day operational management. This doesn’t change in an offshore model.

The more successful global-sourcing managers understand that the relationship with both the business units and the offshore delivery teams must be balanced with best practices. Constantly pushing for performance and jointly designing solutions with offshore teams will drive better results and establish motivated teams that go the extra mile. Conversely, global-sourcing managers who just manage the metrics and wait for end-user problems will usually find themselves frustrated with mediocre performance of a team likely capable of far better results.

Cliff Justice is multishore practice leader at EquaTerra, an offshore advisory service. He is reachable at Cliff.justice@equaterra.com.