The North American market for outsourced customer service operations is expected to continue along a steady growth path, according to recent research by Frost & Sullivan Inc.
The San Antonio-based research and consulting firm states that the market reached $19.5 billion in revenues in 2005 and is likely to reach $20.1 billion by 2012. Call center agent attrition, companies' continuing to adjust to the Do Not Call legislation, and greater specialization by North American outsourcers are driving the market, according to Michael DeSalles, Frost & Sullivan's industry analyst for the communications practice.
"Call centers are the tip of spear. In a lot of places, it's the only place [the] customer touches the company," DeSalles said. "For some companies, they find that's not their core competency, that's for someone else. An outsourcer can do it cheaper or better. If you're not doing a good job or at least on par with companies with good contact centers, you're at a competitive disadvantage."
Also, the backlash by North American consumers over jobs sent overseas is helping to bolster the on-shore and near-shore outsourcing markets.
The market for North American customer service outsourcing is a fragmented one, with literally thousands of providers. According to Frost & Sullivan, however, it is dominated by fewer than a dozen major, global outsourcers.
The market is growing, but outsourcers are also under increasing pressure to do more than just increase efficiencies. Clients expect outsourced call centers to improve retention, and loyalty as well.
"The way to measure that is not by handle time, which was the prevailing metric," DeSalles said. "Now we're looking at first-call resolution."
Outsourcers are also conducting post-call surveys, measuring the number of transfer calls and up-selling and cross-selling.
Consolidation in the market has also provided companies with the ability to mix and match their outsourced call center needs, using some offshore, some near-shore and some internal resources. The growth of work-at-home agents, who can access CRM systems through Web-based interfaces and phone systems through Voice over Internet Protocol, is also providing outsourcers with a greater talent pool, while reducing facility costs.
Friday, September 25, 2009
Friday, September 11, 2009
Offshore Outsourcing Driving Contact Center Growth in Asia Pacific
Despite the negative press that the term off shoring tends to generate, the reality is that we are a global economy and many companies can maximize customer service operations by considering facilities in another country. One such country that is enjoying considerable contact center growth is that of the Asia Pacific.
Growth consulting firm Frost & Sullivan has produced new analysis that points to low labor cost, increasing competition, globalization, increased IP (Internet Protocol) adoption and improved network infrastructure as driving the contact center outsourcing market in Asia Pacific.
While high growth in both domestic and offshore outsourcing is expected in the coming years, offshore outsourcing is anticipated to drive a majority of that growth. Customer service and technical support services in the banking, telecommunications and technology sectors are on the rise and will likely fuel this growth.
According to the report from Frost & Sullivan, the Asia Pacific industry, which covers 13 major Asia Pacific economies, produced revenues of US $7.2 billion in 2005 and estimates indicate that the industry will be worth US $25.1 billion by the end 2012.
Frost & Sullivan industry analyst Shivanu Shukla, offered that offshore outsourcing is a global phenomenon that has driven growth in the contact center outsourcing market in Asia-Pacific and expects to continue to be the key driver for growth. Proximity to the West, cultural similarities within Asia Pacific and increased focus on outsourcing and offshoring by the governments in Asia Pacific are all expected to boost growth.
US companies using India as a back-office hub for their administrative functions has led the offshore outsourcing trend. Many enterprises today from not only the US, but also the UK have outsourced significant portions of their customer care functions to countries such as the Philippines and India. Contact center outsourcing contacts serviced out of the Asia Pacific region from these two countries has represented more than US $2.17 billion in 2005.
Shukla noted that as the contact center market in Asia Pacific continues to return strong growth, the demand for skilled agents increases in tandem. Since employment as a contact center agent is not perceived as a great career option in most parts of the region, available talent pools are lacking. In addition, inadequate compensation and incentives are leading to higher attrition and agents tend to move fast within the industry.
Frost & Sullivan recommends that outsources offer structured career paths and better incentives to reduce attrition. The firm also highlighted the need to train and coach agents and leaders in order to build a strong middle management team as a necessity to retain employees.
Data security and customer information issues have been a key area of concern for customers and companies alike and as a result, outsourcers in India and other offshore destinations are implementing stringent measures to ensure that data security is maintained. ISO and COPC (Customer Operations Performance Center) certifications, along with Six Sigma processes are gradually being adopted by outsourcers to increase the confidence level of customers and enterprises that outsource their customer information to the Asia Pacific region.
Growth consulting firm Frost & Sullivan has produced new analysis that points to low labor cost, increasing competition, globalization, increased IP (Internet Protocol) adoption and improved network infrastructure as driving the contact center outsourcing market in Asia Pacific.
While high growth in both domestic and offshore outsourcing is expected in the coming years, offshore outsourcing is anticipated to drive a majority of that growth. Customer service and technical support services in the banking, telecommunications and technology sectors are on the rise and will likely fuel this growth.
According to the report from Frost & Sullivan, the Asia Pacific industry, which covers 13 major Asia Pacific economies, produced revenues of US $7.2 billion in 2005 and estimates indicate that the industry will be worth US $25.1 billion by the end 2012.
Frost & Sullivan industry analyst Shivanu Shukla, offered that offshore outsourcing is a global phenomenon that has driven growth in the contact center outsourcing market in Asia-Pacific and expects to continue to be the key driver for growth. Proximity to the West, cultural similarities within Asia Pacific and increased focus on outsourcing and offshoring by the governments in Asia Pacific are all expected to boost growth.
US companies using India as a back-office hub for their administrative functions has led the offshore outsourcing trend. Many enterprises today from not only the US, but also the UK have outsourced significant portions of their customer care functions to countries such as the Philippines and India. Contact center outsourcing contacts serviced out of the Asia Pacific region from these two countries has represented more than US $2.17 billion in 2005.
Shukla noted that as the contact center market in Asia Pacific continues to return strong growth, the demand for skilled agents increases in tandem. Since employment as a contact center agent is not perceived as a great career option in most parts of the region, available talent pools are lacking. In addition, inadequate compensation and incentives are leading to higher attrition and agents tend to move fast within the industry.
Frost & Sullivan recommends that outsources offer structured career paths and better incentives to reduce attrition. The firm also highlighted the need to train and coach agents and leaders in order to build a strong middle management team as a necessity to retain employees.
Data security and customer information issues have been a key area of concern for customers and companies alike and as a result, outsourcers in India and other offshore destinations are implementing stringent measures to ensure that data security is maintained. ISO and COPC (Customer Operations Performance Center) certifications, along with Six Sigma processes are gradually being adopted by outsourcers to increase the confidence level of customers and enterprises that outsource their customer information to the Asia Pacific region.
Wednesday, September 2, 2009
Contact Center Outsourcing Services
Customer Care Support balances improved customer satisfaction with reduced operation costs in handling various post-sale interactions including complex product and service inquiries, data privacy and security breaches, fraud management, crisis management, billing and credit issues, and product returns and reverse logistics.
People – Our people are the most important component of our approach. Our contact centers around the world are staffed with experienced, results-oriented teams that drive agent productivity and operational innovation. You will find a highly skilled global technology staff who ensure that daily operations remain stable and reliable. We also have recruiting processes that select, train, and retain the best customer service professionals to maintain and improve customer satisfaction. Our agents are further supported through focused training and retention programs that increase agent effectiveness.
Process – Around the world, our contact centers combine our globally consistent, customer operations performance center (COPC) compliant delivery processes with our standard technology infrastructure expertise to help you achieve your customer-focused goals. By clearly measuring the effectiveness of our processes both quantitatively and qualitatively, we provide the operational discipline to effectively manage operations within an individual contact center, across multiple sites or multiple geographies.
Technology – The technology component is a key enabler of the people and process components. Our global leveraged technology platform is built using products from key alliance partners and provides your business with superior functionality, reliability, scalability and security. Its advanced routing capability ensures customers are segmented by value and connected to the appropriate resource the first time, regardless of the interaction channel chosen by the customer.
Quality- All three of these components are strengthened by a Quality System that we have developed over the last decade and continues to enhance globally. Our Quality System is our set of management practices to ensure that our services, products, and solutions are reliably designed, delivered and supported at the claimed quality levels and continuously improved to meet changing customer and business requirements. To support the Quality System, we provide a comprehensive integrated framework comprised of dozens of market recognized best practices, regulation and standards. These Quality components are woven into the fabric of our global common processes to enable consistent delivery of services while complying with international standards for quality, security, privacy, and service management that protect the interests of our clients and their customers.
People – Our people are the most important component of our approach. Our contact centers around the world are staffed with experienced, results-oriented teams that drive agent productivity and operational innovation. You will find a highly skilled global technology staff who ensure that daily operations remain stable and reliable. We also have recruiting processes that select, train, and retain the best customer service professionals to maintain and improve customer satisfaction. Our agents are further supported through focused training and retention programs that increase agent effectiveness.
Process – Around the world, our contact centers combine our globally consistent, customer operations performance center (COPC) compliant delivery processes with our standard technology infrastructure expertise to help you achieve your customer-focused goals. By clearly measuring the effectiveness of our processes both quantitatively and qualitatively, we provide the operational discipline to effectively manage operations within an individual contact center, across multiple sites or multiple geographies.
Technology – The technology component is a key enabler of the people and process components. Our global leveraged technology platform is built using products from key alliance partners and provides your business with superior functionality, reliability, scalability and security. Its advanced routing capability ensures customers are segmented by value and connected to the appropriate resource the first time, regardless of the interaction channel chosen by the customer.
Quality- All three of these components are strengthened by a Quality System that we have developed over the last decade and continues to enhance globally. Our Quality System is our set of management practices to ensure that our services, products, and solutions are reliably designed, delivered and supported at the claimed quality levels and continuously improved to meet changing customer and business requirements. To support the Quality System, we provide a comprehensive integrated framework comprised of dozens of market recognized best practices, regulation and standards. These Quality components are woven into the fabric of our global common processes to enable consistent delivery of services while complying with international standards for quality, security, privacy, and service management that protect the interests of our clients and their customers.
Thursday, August 27, 2009
Offshoring by US companies surges: Survey
WASHINGTON: US companies are increasingly turning to off shoring their functions to achieve cost savings, and few plan to bring those jobs back to
IT
Top Indian outsourcing cos
Nine trends for IT in 2009
Cities that are IT hubs
the United States, the Conference Board said Monday.
The number of US companies with a corporate off shoring strategy in place more than doubled in the past three years, according to the fifth annual report on off shoring trends, published by Duke University in collaboration with the Conference Board.
Of the companies surveyed, 53 per cent had a corporate off shoring strategy in place, up from 22 per cent in 2005, said the Conference Board, a nonprofit business research organization.
"Sixty per cent of companies that had already offshore say they have aggressive plans to expand existing activities, and very few plan to relocate activities back to the United States," it said.
IT
Top Indian outsourcing cos
Nine trends for IT in 2009
Cities that are IT hubs
the United States, the Conference Board said Monday.
The number of US companies with a corporate off shoring strategy in place more than doubled in the past three years, according to the fifth annual report on off shoring trends, published by Duke University in collaboration with the Conference Board.
Of the companies surveyed, 53 per cent had a corporate off shoring strategy in place, up from 22 per cent in 2005, said the Conference Board, a nonprofit business research organization.
"Sixty per cent of companies that had already offshore say they have aggressive plans to expand existing activities, and very few plan to relocate activities back to the United States," it said.
Wednesday, August 26, 2009
Does Outsourcing Really Add Jobs To The US Economy ?
We've all seen the headlines: Outsourcing America; John Kerry Says He'll Put an End to "Off-shoring" US Jobs. Are Too Many US Jobs Going Overseas? But have we really stopped to look at the benefits of working with offshore companies?
In just over one year since Tele-Sales Force, Inc. began operations and subsequently launched TSF Call Center, Tele-Sales Force, Inc. has signed up over 25 customers including Sun Micro systems and People Soft, added more than a dozen US jobs (Executive Team, Controller, Legal Counsel, Sales Professionals, etc.) and perhaps most importantly, helped other US companies increase sales dramatically. According to Stephen Polinski of Genuine, "Tele-Sales Force, Inc. helped us understand our target market better, developed a value- based sales message, and then executed the telesales campaign. In just a few weeks, we closed a transaction worth $86,000 to our company."
Chad Burmeister, Co-Founder and CEO of Tele-SalesForce, Inc. said, "Just like enterprise software helped companies throughout the 1990's to reduce costs by millions, improve efficiencies, and help companies compete, Business Process Outsourcing (BPO) will become the next buzzword for the remainder of this decade. In our first year of operations, our company has proven that by taking a socially responsible approach to outsourcing, and focusing on jobs that US workers typically don't do as effectively, or do not want to do at all, we can add new jobs to the US Economy, not take them away." Mr. Burmeister also said, "We hired one local Account Executive that made about 100 telesales calls in the 10 months he worked with us. Our offshore telesales agents make more than 100 outbound telesales calls every day."
Additional value created by TSF includes: Identified and scheduled conference calls with decision makers at thousands of auto dealers which led to more than $800,000 in sales; provided 24 hour instant message support for a bank in Arizona to help them compete with B of A and other large banks; enabled at least three US companies to start a business using TSF call center as the backbone of their telesales operations; partnered with one US based call center in the past 60 days and already sold 2 seats for them.
The Scoreboard: Net US jobs lost: 0. Net US jobs gained
About TSF Call Center - TSF Call Center , world class call center, world class results, helps companies build a successful marketing campaign, monitor the campaign, and insure the best possible results. Additional services include complete outbound telesales campaigns, inbound call center support, and other back office services such as instant messaging, email support, and claims processing. The company is based in Southern California, has a sales office in Scottsdale, Arizona, a call center in Philadelphia, PA and a 350+ seat call center in Calcutta, India.
In just over one year since Tele-Sales Force, Inc. began operations and subsequently launched TSF Call Center, Tele-Sales Force, Inc. has signed up over 25 customers including Sun Micro systems and People Soft, added more than a dozen US jobs (Executive Team, Controller, Legal Counsel, Sales Professionals, etc.) and perhaps most importantly, helped other US companies increase sales dramatically. According to Stephen Polinski of Genuine, "Tele-Sales Force, Inc. helped us understand our target market better, developed a value- based sales message, and then executed the telesales campaign. In just a few weeks, we closed a transaction worth $86,000 to our company."
Chad Burmeister, Co-Founder and CEO of Tele-SalesForce, Inc. said, "Just like enterprise software helped companies throughout the 1990's to reduce costs by millions, improve efficiencies, and help companies compete, Business Process Outsourcing (BPO) will become the next buzzword for the remainder of this decade. In our first year of operations, our company has proven that by taking a socially responsible approach to outsourcing, and focusing on jobs that US workers typically don't do as effectively, or do not want to do at all, we can add new jobs to the US Economy, not take them away." Mr. Burmeister also said, "We hired one local Account Executive that made about 100 telesales calls in the 10 months he worked with us. Our offshore telesales agents make more than 100 outbound telesales calls every day."
Additional value created by TSF includes: Identified and scheduled conference calls with decision makers at thousands of auto dealers which led to more than $800,000 in sales; provided 24 hour instant message support for a bank in Arizona to help them compete with B of A and other large banks; enabled at least three US companies to start a business using TSF call center as the backbone of their telesales operations; partnered with one US based call center in the past 60 days and already sold 2 seats for them.
The Scoreboard: Net US jobs lost: 0. Net US jobs gained
About TSF Call Center - TSF Call Center , world class call center, world class results, helps companies build a successful marketing campaign, monitor the campaign, and insure the best possible results. Additional services include complete outbound telesales campaigns, inbound call center support, and other back office services such as instant messaging, email support, and claims processing. The company is based in Southern California, has a sales office in Scottsdale, Arizona, a call center in Philadelphia, PA and a 350+ seat call center in Calcutta, India.
Tuesday, July 28, 2009
Call Centers - Generate Revenue by Satisfying Customers
A call center is a physical place where customers are dealt by customer care experts, normally with the help of computer automation. Characteristically, a call center has the power to manage a high volume of incoming calls at the same time, to separate out calls and send on them to someone specified to address their concerns also to log calls.
These call centers are largely used by companies which are deals on telemarketing, product help desk, on line marketing, service providers, travel industries, and every large business organization that uses the phone to sell products or provide services.
A great call center is mainly depends upon some factors like efficiency, customer satisfactions and revenue generation. The efficiency or the ability to handle customers with effectiveness without wasting time, effort and expense can make any call center bonafide and adequate.
Every customers looks for quick and efficient answers to their questions and that is known as customer satisfaction services.
Customer satisfaction takes place when a call delivered the exact answer to the question placed by a customer, whenever they want it. Highly skilled customer care representatives can easily understand the fact that the customer does not perpetually enunciate what they want, sometimes one need to comprehend and should act effectively.
Now a days, the scripts are being provided to every calling agent for the purpose of saving time and also giving exact information’s to their customers. However, sometimes one need to understand or determine the reason of being contacted in first place to help him/her right way.
If customer representative can understand the exact concern of the customer, they can easily help them justly and this will produce a satisfied customer for any call centers.
To get revenue upon your investment you must have to satisfy your every customers in today’s World because customers are main asset of any successfully organization. As the revenue generation is the one and only bottom line of any organization and begetting revenues is impossible without satisfied customers and the more effective the call center, the more time is usable for the same.
To intact the bottom line you must find ways to satisfy your customers to grow your business. If you are unable to provide solutions for customer satisfaction services then the wise idea is to outsource call center services from quality call centers.
Tina Hope is writing articles for Call Centers India Inc. (CCI), a globally recognized call center services provider produce quality agents that serves quality service with little waste of time and energy. Inspired and impelled to satisfy customers’ needs effectively, ensuing to additional and continuous revenue for clients.
These call centers are largely used by companies which are deals on telemarketing, product help desk, on line marketing, service providers, travel industries, and every large business organization that uses the phone to sell products or provide services.
A great call center is mainly depends upon some factors like efficiency, customer satisfactions and revenue generation. The efficiency or the ability to handle customers with effectiveness without wasting time, effort and expense can make any call center bonafide and adequate.
Every customers looks for quick and efficient answers to their questions and that is known as customer satisfaction services.
Customer satisfaction takes place when a call delivered the exact answer to the question placed by a customer, whenever they want it. Highly skilled customer care representatives can easily understand the fact that the customer does not perpetually enunciate what they want, sometimes one need to comprehend and should act effectively.
Now a days, the scripts are being provided to every calling agent for the purpose of saving time and also giving exact information’s to their customers. However, sometimes one need to understand or determine the reason of being contacted in first place to help him/her right way.
If customer representative can understand the exact concern of the customer, they can easily help them justly and this will produce a satisfied customer for any call centers.
To get revenue upon your investment you must have to satisfy your every customers in today’s World because customers are main asset of any successfully organization. As the revenue generation is the one and only bottom line of any organization and begetting revenues is impossible without satisfied customers and the more effective the call center, the more time is usable for the same.
To intact the bottom line you must find ways to satisfy your customers to grow your business. If you are unable to provide solutions for customer satisfaction services then the wise idea is to outsource call center services from quality call centers.
Tina Hope is writing articles for Call Centers India Inc. (CCI), a globally recognized call center services provider produce quality agents that serves quality service with little waste of time and energy. Inspired and impelled to satisfy customers’ needs effectively, ensuing to additional and continuous revenue for clients.
Tuesday, July 21, 2009
Successful Offshore Outsourcing
1. Clearly define the scope and schedule of your project.
This might seem obvious, but any successful outsourced project always starts with a clear statement of what you are hoping to accomplish. Define your project requirements up front. Service providers need accurate, complete information to present you with realistic proposals and to quote you a reasonable price. Be specific about the deliverable you expect the vendor provide. Give vendors as much information as you can about what you need delivered and the way in which you need the work done. Also, be clear and realistic about your schedule requirements - project schedules can have a huge impact on project costs.
2. Evaluate a service provider like you'd hire a full-time employee
When you're evaluating proposals from service providers, don't be afraid to ask questions. Just like hiring a full-time employee, selecting a vendor is a very subjective experience. Check their references and ask for feedback from other clients who have used their services. Engage in a dialog - if you have any concerns about a vendor's specific capabilities, voice your concerns. Don't just stew about it and hope for the best.
3. Look for specific experience fit
Ideally, the service provider you select will have specific experience with the type of project that you're undertaking. You don't want to be somebody's "guinea pig." This is especially crucial when outsourcing complex technical projects such as software development. For example, if you're looking for someone to develop an application for the Palm PDA, make sure they've actually completed commercial projects on that platform for other satisfied customers. This advice holds true for other types of projects as well. If you need a business plan for opening a retail store, you'll get best results if the consultant you hire has verifiable experience in the retail sector.
4. Don't choose a vendor based solely on price
Though it might be tempting, never select a vendor based solely on price. Experienced buyers who have outsourced many projects and evaluated hundreds of proposals almost always recommend discarding the highest-priced and lowest-priced bid. Buyers report that their most successful projects are the ones where they felt the vendor offered a balance of good value and quality results.
5. Review portfolios and samples
Examine the vendor's previous work (their "portfolio") and make sure that their previous work meets your expectations for quality and style. If you've evaluated a vendor's portfolio, references and previous experience and are still unsure of their capabilities, consider asking them to do a quick mock-up or provide a basic outline of a work plan. A service provider who really wants to win your business might be able to give you a rough concept so you can better understand their approach to solving your problem. But never cross the line between asking for a mock-up and insisting that a vendor provide you with finished work "on spec." No qualified professional expects to work for free.
6. Start small
When engaging with a service provider for the first time, start with a project that is relatively small and simple in scope. This will give you a better idea of the provider's style and capabilities before you entrust a "mission critical" project to them.
7. Tie payment to clearly defined project milestones
Just as you should be clear about project scope, make sure that you define a work plan for your outsourced project with clearly defined milestones. Having scheduled checkpoints where you review the status of the project as it works toward completion-is an easy way to ensure that you meet your final deadline and that the final product meets your standards. Tie the vendor's payment to these milestones. A good guideline for IT and software development projects is to pay no more than 20% to 30% of the total project price up front, with the rest of the payments awarded based on the completion of 3 or 4 milestones.
8. Negotiate ownership of work up front
For any type of outsourced project, make sure that you are clear about who owns the resulting work product and any important components of that product. Make sure the service provider understands how you intend to use the deliverables that they are agreeing to provide. For example, the development of a custom software application for your personal use would be substantially different from the development an application that you intend to package and re-sell.
9. Don't forget about support after the project is complete
For technology projects, it's a good idea to specify a warranty or support clause so that you are assured of some amount of continuing support from the vendor after the project is complete. It's much easer to negotiate a support clause before the service provider begins work, rather than after the completion of the project. Even creative or business services can benefit from a support clause. Suppose you need some changes to a business plan based on feedback that you get from potential investors. Or maybe you find that you need that snazzy new logo delivered in a new type of file format. Specifying some amount of free support or negotiating discounted prices for future modifications can save you time, money and headaches later on.
10. Get it in writing
This might seem obvious, but any successful outsourced project always starts with a clear statement of what you are hoping to accomplish. Define your project requirements up front. Service providers need accurate, complete information to present you with realistic proposals and to quote you a reasonable price. Be specific about the deliverable you expect the vendor provide. Give vendors as much information as you can about what you need delivered and the way in which you need the work done. Also, be clear and realistic about your schedule requirements - project schedules can have a huge impact on project costs.
2. Evaluate a service provider like you'd hire a full-time employee
When you're evaluating proposals from service providers, don't be afraid to ask questions. Just like hiring a full-time employee, selecting a vendor is a very subjective experience. Check their references and ask for feedback from other clients who have used their services. Engage in a dialog - if you have any concerns about a vendor's specific capabilities, voice your concerns. Don't just stew about it and hope for the best.
3. Look for specific experience fit
Ideally, the service provider you select will have specific experience with the type of project that you're undertaking. You don't want to be somebody's "guinea pig." This is especially crucial when outsourcing complex technical projects such as software development. For example, if you're looking for someone to develop an application for the Palm PDA, make sure they've actually completed commercial projects on that platform for other satisfied customers. This advice holds true for other types of projects as well. If you need a business plan for opening a retail store, you'll get best results if the consultant you hire has verifiable experience in the retail sector.
4. Don't choose a vendor based solely on price
Though it might be tempting, never select a vendor based solely on price. Experienced buyers who have outsourced many projects and evaluated hundreds of proposals almost always recommend discarding the highest-priced and lowest-priced bid. Buyers report that their most successful projects are the ones where they felt the vendor offered a balance of good value and quality results.
5. Review portfolios and samples
Examine the vendor's previous work (their "portfolio") and make sure that their previous work meets your expectations for quality and style. If you've evaluated a vendor's portfolio, references and previous experience and are still unsure of their capabilities, consider asking them to do a quick mock-up or provide a basic outline of a work plan. A service provider who really wants to win your business might be able to give you a rough concept so you can better understand their approach to solving your problem. But never cross the line between asking for a mock-up and insisting that a vendor provide you with finished work "on spec." No qualified professional expects to work for free.
6. Start small
When engaging with a service provider for the first time, start with a project that is relatively small and simple in scope. This will give you a better idea of the provider's style and capabilities before you entrust a "mission critical" project to them.
7. Tie payment to clearly defined project milestones
Just as you should be clear about project scope, make sure that you define a work plan for your outsourced project with clearly defined milestones. Having scheduled checkpoints where you review the status of the project as it works toward completion-is an easy way to ensure that you meet your final deadline and that the final product meets your standards. Tie the vendor's payment to these milestones. A good guideline for IT and software development projects is to pay no more than 20% to 30% of the total project price up front, with the rest of the payments awarded based on the completion of 3 or 4 milestones.
8. Negotiate ownership of work up front
For any type of outsourced project, make sure that you are clear about who owns the resulting work product and any important components of that product. Make sure the service provider understands how you intend to use the deliverables that they are agreeing to provide. For example, the development of a custom software application for your personal use would be substantially different from the development an application that you intend to package and re-sell.
9. Don't forget about support after the project is complete
For technology projects, it's a good idea to specify a warranty or support clause so that you are assured of some amount of continuing support from the vendor after the project is complete. It's much easer to negotiate a support clause before the service provider begins work, rather than after the completion of the project. Even creative or business services can benefit from a support clause. Suppose you need some changes to a business plan based on feedback that you get from potential investors. Or maybe you find that you need that snazzy new logo delivered in a new type of file format. Specifying some amount of free support or negotiating discounted prices for future modifications can save you time, money and headaches later on.
10. Get it in writing
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