Management Of Operations

With the initial evaluation of service providers limited largely to proposals, the site visit is an opportunity to interact with the actual management team who will—if selected—ensure the success of your deliverables. Take a look at the organizational structure. Understand who is in charge of the delivery center and where they are in the overall organization. How does your account manager influence operations and accountability within the delivery team? You should also understand the history of the offshore center (how long it’s been a delivery center, its overall maturity, etc.)

Assess the quality of the service provider’s onsite management team. What are their professional backgrounds? Does the management team understand the needs and risks of your organization?

Ask about the transitions they’ve led and probe for deals that are similar to yours. Ideally, you should go into the site visit knowing what you want the offshore operation to look like, and then use the day to determine whether the environment and the performance measure up. New processes obviously require new environments, so you can’t envision a replica of your domestic workplace, lest you merely “outsource your mess for less.” But it is your responsibility to ensure the offshore management team can deliver.

How well does the service provider manage language issues and potential cultural barriers? Again, we all may speak English, but the frame of reference can differ from one country to the next. Conversational idioms like “we’ll cross that bridge when we come to it” might send a Chinese call-center agent looking for a map. Of course, the sales proposal will tout Web-based glossaries and “accent neutralization” to mitigate communication challenges, but how well do those tools really work? Are the agents aware of the target audience’s culture? Do they have empathy and good judgment?

It’s extremely important to ask for permission from one or more of the center’s clients to sit in on some of their customer calls. Why? One U.S.-based company initially set up an offshore call center in India, but because the sourcing manager didn’t visit the site in advance or listen in on any calls, the company encountered unexpected accent problems that disrupted customer service. After two years of customer complaints and frustration, the company ended up launching a pilot project with another provider and ultimately transferred most of the customer-facing processes to the Philippines.

Most sales presentations also include overall rates of employee attrition, but ask the management team to break them down so they’re relevant to your company processes. For example, if you’re outsourcing transactional work such as script-based call-center operations, you can accept a certain level of churn. But if you’re outsourcing more complex work such as R&D or interactive problem-solving, the retention of experienced employees is critical.

In short, make sure the provider’s management team focuses on recruiting and retaining the right people for your processes. One company that was concerned about customer service at an offshore call center visited the site to find that seven percent of the agents were disgruntled PhDs. The company relocated the operation to another country, where agents at the appropriate skill level were excited about serving customers.

Workplace Culture

The genesis of an outsourcing relationship is “formin’, stormin’, and normin’”—that is, forming the relationship, storming ahead with the complexities of the transition and, most important, establishing the norm, which is likely to be the business reality for the life of the relationship. The site visit is an opportunity to get a realistic picture of your company’s long-term norm with this service provider. Do you feel a connection to the delivery team? Do you think your company could work with this team for a long time?

Find out by watching what the delivery team does now, not what they say they’ll do in the future. Observe the work culture; understand the provider’s priorities. For example, is the team more client-focused or process-focused? How responsive, for instance, is the service provider to a client who needs to sideline one project in order to push another one through? Does the service provider accept criticism? During the site visit, pose these kinds of scenarios to determine whether the service provider’s culture jibes with yours.

After conducting a site visit to an India-based facility operated by a well-known offshore provider, one financial-services company ended up questioning whether its U.S. group could work with an offshore group 10,000 miles and 12 time zones away. So, the U.S. company opted to initiate a pilot project to test whether the partnership could work on a larger scale. After all, your domestic team may be accustomed to staying up all night if necessary, but it doesn’t matter if your delivery team doesn’t abide by the same work culture. Workers’ comfort zones will influence the long-term relationship. While the site visit was a good tool for understanding how the offshore company worked with other clients, the pilot project gave the offshore group an understanding of what it could expect within its own culture, as well as insight into the actual benefits. In my experience, the pilot project is an extremely important tool for helping some companies evaluate if offshoring will be successful with their culture.

Another part of the work culture is quality assurance. Certifications and metrics are important, but what matters more to attaining and maintaining success is a culture that fosters an ever-improving relationship between clients and the work teams. If the service provider is operating in a quality-improvement environment, such as Six Sigma, that looks great on paper, how would that translate into working relationships between teams on both sides of the ocean? Will your retained organization work within that structure? Important questions to keep in mind include: How are problems addressed? What type of transformation would be needed for the provider’s QA processes to be successful within your organization? In my experience, the provider’s organization can have the best QA processes in the world, but unless it’s compatible with your culture, it is of little use, and vice-versa.

Final Thoughts

The successful transition of a business process to a service provider is already a formidable task. Throw in a few international time zones, divergent work styles and communications with different cultures, and you’ve got your hands more than full. That’s why a structured site visit—during the evaluation phase—is essential. Your firsthand experience of the offshore delivery capabilities, management of operations, and workplace culture will provide the most realistic picture of a potential provider...and inhibit you from making a potentially costly, and sometimes devastating, mistake, either in provider or location selection.

Cliff Justice is Multishore Practice Lead at EquaTerra, an insourcing and outsourcing advisory firm. He can be reached at Cliff.justice@equaterra.com.