Category: Outsourcing

Small businesses often find themselves trapped in complex technological needs. They usually have limited in-house IT capabilities. Many businesses fail to implement a right strategy for technology operations, while those who are confident to implement, are unable to devote sufficient time to organize them.  The end result is that businesses incur a high cost to manage their information technology and cloud requirements. This alleviates business productivity and in some cases creates chaos in the organization. Managed Service Providers Managed Service Providers (MSPs) have the expertise to manage a particular business operation. Businesses subscribe to managed services in order to improve their operations and cut cost. MSPs often charge their customers a monthly subscription fee under outcome-based models like Service Level Agreement and by providing proactive management of services. Customers are free to choose what they want MSP to manage and pay accordingly. This helps the customers to keep a control on their IT costs and in return ensure that all their IT needs are met as per their demand. Role of managed service providers MSPs may not be service providers themselves; however, they may act as middlemen between customers and service providers. They design a customized solution for every organization depending upon the contractual agreement. Customers have an equal say in the decision-making process. The whole process of management is quite transparent in managed services, unlike traditional outsourcing service providers who bill the customers outright for the entire project and function independently. Customers can’t control the quality of service being delivered. However, in managed services, quality plays a significant role. Cost control and efficiency are vital parameters in managed services. Therefore, MSPs employ remote monitoring and management software to monitor customers’ IT functions. RMM software lets them remotely troubleshoot and resolve issues with services and endpoint devices. Apart from that, they are capable of managing various customers’ IT systems altogether. Managed services are focused on the desired outcome The focus in managed services is over how effectively and efficiently a particular business outcome is met rather than on what combination of deployment technology is being used by MSP.  MSPs can deliver the service remotely, through service provider’s data center or through hybrid cloud deployment. For instance, a small-scale business owner may find it difficult to implement or move to cloud technology due to lack of knowledge and expertise. Some others may face a challenge to implement shipping and transportation technology or probably supply chain management, and hiring of IT staff.  Managed Service Providers play a crucial role under such circumstances. They intervene to manage all such technology-related challenges taking a prescient and cost-effective approach. Conclusion With cut-throat competition existing in the market, there is hardly any time to spare in processes that are demanding. Over the last few years, various Managed Service Providers have cropped up in the market and for good reason. In 2016, businesses need this kind of services more than ever. MSPs can remotely fix most of your issues and have a bird-eye view of all your processes. MSPs bring their vast experience to manage different technology-related challenges so that you are easy-off.

If you have been watching the industry closely, you surely must have heard about the concept of dedicated hiring. Dedicated hiring is an arrangement through which you hire individual professionals or teams who dedicatedly work on your project, but are not employed by you. The contractual arrangement exists between you (or your company) and the staffing agency which employs those professionals. In other words, it is a business deal in which you agree to pay a certain sum of money to an agency in order to use their manpower for certain projects or a certain number of hours. You could use dedicated teams and workers in a number of domains. Most commonly, dedicated teams work in IT or HR related projects. However, it is not uncommon to hire dedicated financial, accounts and research teams as well. In fact, the sky is the limit when it comes to dedicated teams. Things are changing very quickly in the realm of hiring because most companies cannot afford to have full time employees working for them. In order to offset the financial lacunae, they hire dedicated teams who work based on what is stated in the contractual agreement. There are several advantages to hiring a dedicated team. Some of them are: You do not have to shell out a lot of money on your employees No one is employed full time. You only pay for the services received or for the projects     completed. They work for you as if you have employed them, but they are not employed by you. You do not pay any employee benefits to them. You only pay the agreed amount to the staffing agency which hires the teams. You can access superior talent and professionals even when you can’t afford to hire them full time. Some challenges that you may encounter while hiring dedicated teams While everything looks good when we discuss dedicated teams, there are a few things you need to bear in mind. A dedicated team is not your employed team. Thus, you cannot give them tasks that are not mentioned in the contract. Also, you need to sign service level agreements so that there is no confusion about what is expected from your dedicated teams. Another aspect to bear in mind is that you may have to communicate with them through teleconferencing if you are located in a different country. This may seem like a hindrance but if you hire good teams, it is never a problem. There may also be issues with respect to time zones, culture, accent and working style. Yet, the benefits of dedicated teams far outweigh their lacunae. As discussed above, dedicated teams come with more benefits than disadvantages. Most importantly, they reduce your working costs and help you to focus on what is really important: growing your business and innovation. It may take you a little while to understand the concept of dedicated hiring but it certainly is the future of hiring industry. Know your requirements beforehand The success of hiring a dedicated team depends on what you are really looking for. Ensure that you have a clear idea of what you want and what you expect from your distant teams. This will help you to foresee results and also plan accordingly. Last but not the least, have a conversation with your vendor agency before making hiring decisions.

Most small and medium sized businesses face problems related to human resource. They find it difficult to hire and pay full time employees, especially if it is a onetime project. This is one of the reasons why companies are more open towards hiring temporary contract workers based on projects. This type of hiring is called project based hiring. It indeed comes with a number of advantages which we will discuss in this article. We will also discuss ways in which project based hiring is helping companies to grow in size and stature. In fact, recent studies indicate that project based hiring alone is fueling a SME growth to a point where many companies are actively looking for temporary employees to work on individual projects. This has of course helped companies to meet their targets, reduce costs and focus their resources on innovating and growing their own companies. Why project based workers are better? There are obvious differences between full time employees and contract workers who are given certain projects. Full time employees are on your company’s payroll and they will work as long as they wish to, subject to labor laws. On the other hand, project based workers are with you only till the length of the project and after which, the contract stands nullified. They work according to your rules and you will not have to trouble yourself with many tax and workplace rules. Full time employees on the other hand will require you to pay taxes, follow many labor laws that are cumbersome and also end up spending a lot of money than your company can actually afford. Thus, independent contractors and project based hiring solutions help you to remain independent, as they are not entitled to benefits that employees usually get. You can also avoid a number of legal mistakes when you do not hire full time employees and instead choose to work with contract workers temporarily. This will give you peace of mind and allow you to grow your business, rather than worrying about labor laws and taxes. How does a project based hiring contract work? A project based worker signs a contract in which he or she agrees to work on just one or more aspects of your business, as you might mutually agree upon. For example, you may have a company that deals with construction business. However, you realize that your construction business also requires setting up an ERP in order to automate certain aspects of your business. You probably do not have an IT department who can do it for you. So, you sign a contract with your ERP vendor to allow the professional on your premises, train your employees, install the software and also do a test run. When the ERP is all set and ready to be used, the contract comes to an end and you will no longer have anything to do with this particular individual. In other words, he is not your employee. He is only performing certain previously agreed duties for remuneration, after the completion of which, he is no longer obliged to you contractually. One of the downsides of this is, you will not be able to instruct your project worker to do things that were not mentioned in the contract. For example, you cannot ask this particular professional to also design a logo for you, while he is installing the ERP. The costs will be additional and you may need to revise the contract, should you feel you need his services in other areas that were not primarily discussed. While all this may seem quite clear to you, you might wonder how project based hiring is actually fueling SME growth. The answer to this question is quite varied, depending on whom you ask. In this section, let us take a look at some of the ways in which project based hiring is fueling SME growth. 1.      Reduced costs It goes without saying that project based hiring helps you to cut expenditure. It helps you to cut costs due to lack of overheads and the lack of actual costs with respect to buying hardware or software. You just pay the individual for the work that he or she does and when the project is completed, you will no longer have to worry about anything. Also, by choosing not to hire full time employees, you will save a lot of money than you probably realize. 2.      Allocation of resources The time and resources that you save by hiring a project based worker can be allocated to something more important. Most companies choose to invest the money they save in something that is more important, such as marketing. Marketing investment will help you to reach a wider target audience and bring about an increase in overall revenue to the company. This is more important than hiring someone full time as that will unnecessarily cost you money. 3.      Access to technology Most of the times, small and medium sized businesses do not have access to technology. It is a well known fact that superior technology is a privilege that only the largest of companies can afford. This also means, only large companies are able to afford the kind of employees who are good at what they do. If you are a small company, you may not be able to hire a professional who is very experienced. When you opt for project based hiring, you will gain access to the best in the field. That certainly helps your SME to grow. 4.      Confidence When you know you have access to the best technology and manpower, your confidence grows. It is well known that when CEOs are confident, their employees to feel the same confidence and end up working better. Thus, your own confidence acts as a productivity barometer of your company. By hiring project based workers, you can assure that you are saving money, time and also gaining access to the best that your money can afford. That alone boosts

Flexi hiring refers to the process of hiring employees who work on a flexible structure. Usually, flexi hiring refers to hiring teams from agencies who are not really your employees but work for you as a team, while being on the payroll of another company. This works well because while they are paid full time by their employers, you only pay for the number of hours or projects that they work for you. You will not have to worry about hiring full time employees who will become a burden to your payroll eventually. More often than not, we realize that we do not need full time employees. What companies really need are efficient employees or teams who will work for a specified number of hours or simply, in other words, on specific projects. Once a project is completed, you will no longer have to deal with those teams again, unless you choose to hire them again for a different project. There are a number of advantages to the flexi hiring model. Cost reduction, access to professional skills that you may otherwise not find, flexibility in working style and many other advantages have attracted companies towards the flexi hiring model. What’s more, flexi hiring also helps you increase your ROI. In this article, let us take a look at some of the reasons why flexi hiring ultimately helps you to increase your ROI and profits. Affordability and accessibility are hallmarks of flexi hiring Flexi hiring allows you to hire the best employees your pockets can allow. You will have access to JAVA, Python or just about any expert that you might want, without having to pay a full time salary. The professional’s parent company does that. All that you need to do is, pay the agency charges on an hourly basis or per project. What you choose really depends on you and your vendor. The size of your team can also be increased or decreased depending on your needs. Most importantly, you will not spend money on overheads. You will not have to spend money on hardware or software, something that your flexi-employee brings to the table at no additional cost. All of that will be included in the hourly charges that you pay, usually of course. Choose how you supervise and monitor your virtual teams Also, you can manage your team remotely, without having to supervise them personally. What this really means is, you can rely on good old Skype to stay in touch with your flexi employees and focus on what is really important: building your own products and services without spending extra time or money on what is not very important. You will have complete control over your projects and the way you choose to plan them. Another advantage of flexi hiring is that you can cross boundaries, rhetorically speaking. Do not feel restrained by boundaries You will not be subjected to different labor laws in different countries. You will only have to ensure that you give clear instructions to your flexi teams, who will work on your project as is required by your project. There are obvious tax, legal and other benefits to an arrangement like this. As there are time differences between different countries, flexi teams often work at a time that is convenient for you to contact them. Or, you can request them to be available at designated times so that you can supervise them or ask them to join teleconferences. All this ensures that there is a constant communication between you and your flexi team. Your flexi team may not be working for you but they are certainly accountable to their own employers, who in turn are answerable to you. So, you really do not have to worry about accountability. HR and security related worries are a thing of the past You also do not have to worry about common HR related problems such as attrition, exit interviews, retention and raises. You just have to focus on building and growing your company, while a flexi team ensures that all that is required to fuel your growth is done quickly and efficiently. If you like the work that they do, which is usually the case, you can also prolong the contracts and work on a long term basis. Some companies offer discounts if you choose to work with them on a long term basis. When you hire a flexi team, you are not only saving money but you are also saving a lot of time. This is very important especially if you are looking at research and development and opportunities to innovate your existing products and services. All your data will also be stored carefully and in secure cloud locations, so you do not have to worry about security. Communication takes place over encrypted networks so that you do not have to worry about information that you send or receive. You can also choose to store all your information on your own cloud-based servers, so that flexi-employees have no control over it, unless you choose to give them. Looking forward If we look at the reasons above, it becomes clear that flexi hiring indeed reduces costs and boosts efficiency and innovation. In other words, this helps you to increase your ROI to a level that you didn’t know was possible. After all, flexi hiring comes with many advantages that are usually not within the reach of a company. Access to talent, software and hardware are enough to give a boost to a company that is struggling to make ends meet. If these three areas are taken care of by the flexi teams that a company hires, projects will be completed smoothly and quickly. Added to this, the investment that you make on flexi teams is far less than the benefits that you reap out in the end. Even this helps to increase the ROI and profits of a company at the end of a financial year. As we can see, more and more companies

Outsourcing contracts tend to be taken casually by many businesses since client is not directly involved in delivering a service. A mere contract and a service level agreement do not ensure that you will get the best of the service. A wrong outsourcing service partner can be devastating for your business as it directly affects your customers. For instance, Boeing committed a series of outsourcing mistakes due to which the company had to incur huge additional expenses. In their bid to save cost, their outsourcing model was full of flaws. Some of the mistakes include subcontracting of on-site vendor monitoring, poor co-ordination among vendors as assembled parts did not fit together, lack of expertise as some vendors didn’t have the expertise to design certain sections of the aircraft etc. It is clearly evident from Boeing’s outsourcing project debacle that choosing a right outsourcing model and a right partner is crucial for your business. Higher the stakes, higher is the risk involved. What problems do you face if you enter a wrong partnership? 1.    Reduced levels of customer satisfaction Every business survives because of its customers. And if customers are unhappy, business would not last for long. By partnering with an incompatible service provider, you will frequently notice that your customers are disgruntled for some or the other reason. You will start losing customers and your sales team will be under pressure to acquire more customers. Loss of key accounts will be a big blow to your business. Since the customers are less likely to be loyal due to poor service, your customer acquisition cost will rise abruptly. There will be a steep increase in the number of inbound calls. Though the reasons for customer dissatisfaction can be many, presence of an unsuitable service provider will unusually hike their woes. 2.    Quality of work suffers The quality of service delivery depends on the priorities of a business. Some businesses believe in quantity while others believe in quality. If your service partner is servicing too many accounts, it is likely to affect the service quality delivered to your customers. A disinterested partner will not care to service the customers the way you want it. He will also not be able to maintain minimum service levels. Quality of service delivered also depends on many other factors like infrastructure and technology available with the service provider, service policy, track-record, labor policy, and expertise. As an outsourcer, you must analyze all the factors in detail before choosing the partner. 3.    No growth in partnership Partnership is not limited to signing a contract and working together. In true sense, partnership involves sharing a common vision and aiming for a long-term association. There can’t be any growth in partnership at strategic level if the service provider lacks intent to add value to your service. Many companies fail to recognize opportunities in outsourcing and are stuck in the rut. These are not good signs for a growing and innovating company.  A partner should be such that his initiatives help you climb up the value chain and who looks for betterment of stakeholders across the supply chain. A good partner will always introduce best practices and ideas to improve customer satisfaction. 4.    Frequent contractual constraints A contract is formed to deliver justice to both the parties. But association with a wrong partner can often lead to misuse of the contract. Irrespective of the terms and conditions quoted, clauses can be misinterpreted to get one’s way out. A crafty partner will make excuses during service delivery and frequently cite contractual terms. On the other hand, a trouble free partnership is the one where contract just serves as a formal agreement while the spirit of working together defines the strength of partnership. 5.    Poor communication and co-ordination When the intent is lacking, service provider will not bother to communicate with you on various important issues. The result is ultimately reflected upon quality of service delivery. Lack of communication creates obfuscation. In many cases, in-house employees have to work in tandem with the offshore team. Incompatible partner will not take steps to improve co-ordination between the teams which will lead to downfall in productivity of your in-house employees. In-house employees will be burdened with extra work as they’ll experience lack of support from the service provider. 6.    Time waste When your partner decides not to devote sufficient time to cater to your customers, there is nothing that can change this attitude. Ultimately, you start missing project deadlines. Missing deadlines becomes like a chain reaction, difficult to stop. You are always behind schedule and your performance is sharply affected in the bid to finish the project hastily. When there is no progression in the partnership, a moment comes when you realize that you have lost a couple of months and in worst cases, years too. This downward spiral stops only when you take a firm decision and step out of the partnership. 7.    Money going down the drain An unplanned decision hurts badly in future. When your outsourcing decisions are taken in the spur of the moment, your financial performance is bound to get affected.  The purpose of outsourcing is to free up your resources to concentrate on your core business activities. But what happens, when your secondary activities are not taken care of? You end up spending more money, deploying more resources and human capital to carry out the same task. In the time where profit margins are shrinking due to competition, a wrong outsourcing decision can be fatal to your business. Many service providers overbill their clients when the client is ignorant of the details. 8.    Company image is tarnished When your customers don’t get good service from your service provider, they will only blame you. It is your responsibility to make sure that they get the best service. If your outsourcing provider is someone who shrugs his shoulders at your customers, it is your company image which is being tarnished. Customers feel neglected and you lose them. It takes

Outsourcing already has a negative image today. This is because a number of companies tried to get rid of their duties by handing over projects to third-parties, who in-turn handed them over to low-cost freelancers in order to save costs. While this worked for a while, traditional way of outsourcing has become a dubious way of doing business. Thankfully, sense is gradually prevailing and companies are now looking at partnering with consultancies and agencies which have in-house employees and teams that work on your project without outsourcing to freelancers elsewhere. Even if you are a small company looking at getting some coding or designing done, you probably shouldn’t hire freelancers. While there are a number of great freelancers out there, it is difficult to judge the quality of every run-off-the-mill freelancer you might end up chatting with on online marketplaces. It is also difficult to assess their qualifications and experience. It is always better to hire professional agencies that have a team of professionals to do the outsourced job. In this article, let us take a look at some of the reasons why it might be a bad idea to outsource to a freelancer: 1.       Freelancers are not accountable One of the first things that you must realize is, freelancers are not as accountable as a professional agency is. A professional agency knows how to get things done and they always follow certain protocols to maintain standards and quality. A freelancer is on his or her own, and that makes it difficult to hold them accountable. When something goes wrong, you will be left wondering how you could bring the person to task. In case of an agency, this is not the case. 2.       Lack of access to infrastructure A freelancer probably works from home and does not have access to expensive software, hardware and other infrastructural facilities that is required to complete certain projects. A professional agency not only has the entire infrastructure in place but they also regularly update them. This makes it easier for projects to be completed in time without compromising on quality. 3.       Lack of access to team solutions A freelancer is usually a loner. If he works as a team, he probably outsources it to a third party and then gives you the finished project. This means there is a lack of team-focused execution of projects. This leads to a situation where the freelancer does everything without any input from others. There is absolutely no room for criticism or feedback from peers, except from his own clients. 4.       Lack of access to varied experiences A freelancer usually chooses projects based on his or her own interests. This means, they do not have a versatile knowledge or experience. A professional agency on the other hand, chooses a number of projects regardless of their personal interests. This is where the advantage of a team comes in. A team works together and even if one person is not quite good at a certain programming language, the other members of the team will be able to take care of it. In other words At the end of the day, it is better to opt for a full-fledged consultancy instead of a freelancer, who may or may not have the skills and access to knowledge and infrastructure. Moreover, a professional consultancy or agency will help you with many other services than just one area in which the freelancer may specialize in. It is always a good idea to know how to get things done from a full-fledged company before hiring a freelancer, who often comes with certain risks which may not be palatable.

India has a workforce of 47.41 crore, according to a survey conducted by National Sample Survey Office in 2011-12, out of which rural workers amount to 33.69 crore with 35.3 percent of workers employed as casual laborers. India has an average literacy rate of 74% with rural India recording a literacy rate of 68.9 % in 2011 (Census). With 35.6 crore people in the age-group of 10-24 year, India is the youngest country. The statistics clearly show that there is a huge pool of young rural workforce which is potentially employable. Aspiring and educated youths in rural India are migrating to urban areas due to lack of local employment in rural areas. Apart from that, there are social pressures of earning that forces them to shift permanently to urban India. As a result, urban India is facing congestion due to migrant workers that mount load on limited urban infrastructure. The solution to these problems can be found by generating skilled employment opportunities in rural India . BPO is expanding BPO sector is one of the fastest growing sectors of India with a contribution of 8.1% to country’s GDP.  The sector is witnessing both geographical and vertical expansion. Exports contribute around 67% share in revenue with maximum demand coming from US and Europe. India has a pool of skilled workforce in urban areas and $1.6 billion is annually spent on training the workforce. Central government’s focus on Digital India and Make in India is thrusting the sector farther. (Source: NASSCOM) BPO firms are spread across 50 or more cities across India. However, urban BPOs are facing the challenges of high attrition rate, rising cost of labor and escalating margin pressure. This shows there is a clear business opportunity for urban BPOs to expand in rural India. It does not mean that they should shut shops in urban India. By expanding in rural India, the workforce environment will be balanced giving equal opportunities to rural and urban workforce within their respective areas. Moreover, National Optical Fiber Network is being laid down to connect all the 2, 50,000 Gram Panchayats in India. The major challenge to set up BPOs in rural India is to create industry-ready rural workforce. And skilled workforce can be created through training and skill development initiatives. Creating sustainable social enterprises With the opening of BPO firms in rural areas, the large agricultural economy of rural India will venture into service sector providing employment opportunities to rural youth. For-profit BPO firms, thus created, will be sustainable in the long term due to a number of reasons. Low infrastructure cost The administration expenses are significantly lower in rural India. Office set up cost including space and equipments is much lower than urban India. Strategically chosen central village location will help the businesses to avail essential services like electricity, broadband, and other telecom services easily. Not only that, they will have an easy access to workforce.  Even if a remote cluster of villages is chosen for office set up due to availability of workforce there; essential services can be availed by installing solar panels (for electricity) and deploying a combination of optical fiber and last-mile wireless technology for accessing broadband internet cost-effectively. Low delivery cost Since the cost of production is low, businesses can deliver their services at a much lower cost as compared to their urban counterparts. Low cost of production is attributed to low operational expenses like office rent, utility bills, staff salary etc. Thus, rural BPOs have the capacity to pose a challenge to their urban counterparts Low retention cost Unlike their urban counterparts, rural population will be much more stable and settled. Since there is no migration required to work for a rural BPO, locals will feel empowered at their native place. Workers will be committed to the firm for a longer period. Thus, low attrition rate will contribute towards low retention cost. Invest profits in rural development projects If a certain portion of profit is invested in rural development projects every month, the individuals and communities will gradually become self-reliant both economically and socially. The aim of such rural development projects should be to build homes for homeless, provide better health care, hygiene and access to essential services like clean water and electricity. A continued effort will result in social transformation of rural India. Apart from that, it will induce more jobs into the system indirectly. Services rural BPOs can provide Rural BPOs will have tremendous opportunity to grow and can build domain-specific competencies especially in publishing, legal, finance and accounting, and web research verticals. Publishing can include services like eBook creation, digitization, data conversion, XML tagging etc. Legal services may include contract abstraction while financial services may include financial data review and processing, new customer account set up etc. On the other hand, web research/data management may include services like product classification / mapping, retail data extraction, backend support for MIS generation, back-office procurement services and so on. Rural BPOs can ensure high operational efficiencies through process ownership and decentralized structure. Sustainable business model Rural BPOs will operate as hub and spoke model wherein geographically dispersed small delivery centers will be individually managed. Geographically dispersed teams will be connected well through communication technology. Moreover, the technological infrastructure will be at par with the urban centers using appropriate technology The most important aspect for successful operation of rural BPOs is availability of trained workforce. Local businesses must collaborate with local NGOs and agencies for training and hiring purposes. Development of training centers, infrastructure creation and support should be facilitated in collaboration to produce industry-ready rural workforce. Challenges to be faced by rural BPOs Education system in rural India lacks vocational training. Training organizations find it tough to penetrate remote areas and train youth. Lack of resources and infrastructure becomes a challenge for many business owners. However, easy availability of SME bank loan is helping rural business owners to have an easy access to funds. Apart from that, rural youth tends to train in irrelevant skills by