Can Slow Growth Boost Outsourcing?

It is no secret that more and more companies are moving their projects outside of the company walls by using outsourcing and freelance services to complete the projects. This move has made it possible for companies the world over to remain profitable in the face of economic downturns. This speaks directly to the benefits to be had when outsourcing projects to freelance professionals from all over the world. So many people are skilled in certain areas that they hardly ever use, mostly because they took a job in the world that was outside of their qualifications in order to survive in the failing economy that is plaguing the world. This is not uncommon. Those with degrees in electronics and their inner-workings are especially prone to this because of the cut throat market that reigns. Upon graduating, these people will most often take a job that has little to do with the education they have received. This is a huge waste of resources as many companies will not hire such persons because they have little or no skills in the real world. Barring a complete and total makeover of the way that companies hire professionals, the only chance these people have is to take on freelance jobs that have been outsourced by a company in need of such services. This is becoming common place in this world as freelancing takes a hold and makes it mark on the professional world. Outsourcing is rapidly becoming the best way for companies to save money in light of the downturn that the economy has taken. Little can be gained by these companies when they attempt to keep the projects in house. Moreover, they stand to lose substantial amounts of money by attempting to hire and train someone for the project when you take into consideration all the benefits and salary that must be paid to persons that work inside the company. Outsourcing does away with the need for such benefits by hiring professionals from outside the company walls to make certain that the project is completed in a timely and efficient manner without the large costs involved in training someone for the project. The beauty of outsourcing lies in the simplicity of it all. The freelance professionals that are available for outsourcing the projects are already trained in the inner-workings of the project. This saves the company not only time but money in the long run. The fact remains that hiring a professional for full time work is not productive in most cases when the project is a one time thing that may lead to the possibility of more work but does not guarantee as such. This means that a company may only benefit from a person’s knowledge once and never again. Then if they have already hired such a person then they are required to put into place a full time salary and benefits package that will cost them more than the project is worth in the end. So in essence the company has wasted the valuable resources they have when it comes to a one shot project that is not guaranteed to bring in any long term profits for the company. That is where the outsourcing of projects comes into play. Instead of hiring a full time employee with long term pay and benefits, the company takes part in outsourcing by opening the bidding floor to qualified freelance professionals who will bid for a one time flat fee for the project. Under the outsourcing system, freelance professionals bid and are awarded the project based on their individual merits and the price that they have bid for the project. If they have the skills required then they simply complete the project in exchange for the pay that is agreed upon. That is the only connection that the freelance professional that is hired for outsourcing has to the company and can make no claims to the company for more than the agreed upon pay. This is all done in the comfort of outside locations. This means that the person does not have an office inside the company and is not subject to any benefits that the other employees of the company enjoy. This in itself has saved the company a lot of money. When you take all the factors into consideration you see that outsourcing is the way to go for a lot of things. Many companies are finding that they can run with a surprisingly low number of employees on their payroll as compared to previous years when they use outsourcing as their main method of completing projects especially when it comes to those things that require special training and knowledge that is not taught in the base education of the employees that they regularly hire. There is the possibility that many companies will find improved profit margins in relation to the former bottom lines that they once thought to be too low. In the essence of good business decisions, more and more companies are outsourcing their projects in an effort to streamline their business with an eye to the future. There is much to be gained by outsourcing the projects that a company needs completed. All over the globe there are people who are highly skilled but not using those skills in their normal jobs. This is a tragedy to many who know that these professionals can be tapped to provide valuable services to the companies all over the world that are spending millions of dollars more than they should be to get the work done that is so vital to the company. Most of the knowledge that can be found in the freelance professionals of the world that take part in outsourcing is mandatory for the companies of today. So much is relied upon by these companies and it is of the utmost importance that they work to maintain a higher profit margin in an effort to boost the world out of the recession that it currently is in to provide the best work possible for their customers. In the end if there are no customers than there is no business and they need to find cheaper ways in which to maintain an airtight business without harming that which is important to them. Outsourcing is the only solution to the problem as more and more companies are struggling and laying off workers in an effort to remain profitable. They will notice a 50% decrease in costs when outsourcing takes place on the projects that can be completed by freelance professionals. If the economy continues on the downward spiral than a great loss of jobs is not far off in the horizon. This speaks directly to the need for outsourcing of the projects that companies need to the freelance professionals of the world who can get the job done at a fraction of the cost and normally within a shorter amount of time than originally conceived. To maintain this type of business most companies will benefit in a short period of time when they outsource the projects to those who do not operate in house. Furthering the cause of outsourcing is of vital importance to all those who need the work completed in a timely manner and with the professional quality that so many can bring to the table.

Continuous Improvement of Business Audits

An effective audit process will mean that audit teams will be taking a systematic approach to gathering and interpreting data and information. In order to maximise the value of the outcomes of the audits the management should: Accept that the audit activity needs appropriate resourcing, including training of auditors, education of operational and management staff, and physical and financial funding. If any of these are inadequate, then the quality of outcomes will suffer. Accept that there will be limitations to the data gathered and the outcomes produced, not least because of the influence of the quality and quantity of resources allocated to the audit activity, but also because of the varying standards of judgement and interpretation that may be applied to the outcomes; Focus on trends, take appropriate corrective action on specific issues, but look for trends and patterns that indicate underlying, hidden, problems that need addressing; Ensure that the auditing activity is flexible and adaptable, in order to make it compatible with the culture and structure of the organisation, rather than adopt a rigid, unchanging process which is likely to be inappropriate and producing inaccurate results; Challenge the findings, the audit process will not be infallible, and should be challenged continuously to ensure that it is, itself, performing effectively; Apply the highest possible standards to the interpretation of results and judgement on what action to take, this requires training, experience, expertise, awareness of the internal and external environment, and an awareness of the impact of proposed changes on the motivation and morale levels of staff and managers, and an ability to forecast the impact on the operational and strategic objectives.

However, there are some dangers that must be avoided in order to maximise the effect of the audits. These include: Overload of data and information, the result either or too many audits being scheduled in general and-or the unnecessary auditing of areas of activity that are obviously performing well. This can be avoided by targeting the audits and schedules more thoughtfully; Overload of improvement recommendations, not in itself a danger, but the organisation can find it impossible to resource, in terms of budget, time, or human resources - all the improvements identified. The answer is to prioritise, focusing on those improvements that will bring greatest value to the achieving of the organisation’s objectives; Complacency, where results are apparently positive in most areas, there is a danger that management will become complacent. By adopting the kaizen continuous improvement approach to auditing, this should be avoided; Over-reliance on the auditing process, by leaving the identification and correction of poor performance to the audit process, rather than the audit process at least in part confirming that positive, continuous improvement activity is taking place; Managers ignoring the relevance of audit findings the most damaging response. If managers do not take the audit results and recommendations seriously and refuse to implement, or only half-heartedly implement the required changes, then the value of the audit process is wasted.

Although the auditing should be scheduled to examine all processes and activity on a regular basis, there is a need for additional emphasis to be given to auditing poor performers. These are activities, processes, functions, systems, where problems are visible of suspected, but the causes are not certain and need further investigation. In these cases management should arrange for ad hoc audits, and-or for these areas to be given priority in current or imminent auditing activity. It is not acceptable to rely on a generic auditing approach. Not dealing with visible or suspected poor performers immediately will allow poor performance to cause immediate and possibly long term damage. Inevitably, the longer the problems remain unaddressed, the more difficult it will be to take corrective action.

There is a danger that management will see only the audit results and concentrate on the decision making as to what improvements to make, and how to implement these. However, management must remember that the audit results are drawn from the activities of people. This means employees, operational staff, managers, specialists, suppliers, customers, stakeholders. Feedback, shaped and delivered in an appropriate manner, depending on the target group, must be seen as an essential element of effective auditing and successful implementation of changes. Not informing people of the rationale, the purpose, the results, and the positive contribution made by auditing, will lead to low morale and motivation, dissatisfaction, and possibly conflict.

It is essential that the improvements generated by the audits strengthen the organisation’s capability to compete. In order to ensure this happens, management will need to be aware that: It will often be necessary for improvement action to be prioritised. Where this is the case, then those improvements that will contribute the most value to the organisation’s competitiveness should be given higher priority. This is a responsibility of management, who will need to be appropriately skilled in this task; The business sector and general external environment is changing rapidly, and even relatively recent outcomes and improvement recommendations may no longer be appropriate due to significant external changes. This requires management to be alert to such changes and to have the ability to interpret how their organisation should best respond; After improvement changes have been implemented these will have, by default, altered the nature of activities and processes, and will need monitoring, auditing, to ensure that the effect is positive. It is highly likely that most changes made will need adjustment, especially in the early stages after implementation. This must be an integral, high profile, element of the change process.

Business Performance Audits are critical to the success of the organisation. The specific functional, process, and activity improvements generated by the Performance Audits are important and must be visible supported by the management. However, strategic and operational priorities will be constantly changing. Senior management must also ensure that the audit activity contributes positively and supports the strategic direction that the organisation is taking. It is the responsibility of senior management to continuously monitor the effectiveness of the auditing activity in the light of this requirement, and make appropriate changes if necessary.

To obtain the maximum benefit from Business Performance Audits the management must view them as a critically important element of the business. Appropriate resources must be allocated to the activity itself, to the interpretation of results, and to the implementation of improvements generated. Auditing must be integrated into the continuous improvement approach of the organisation. In addition, the objectives of the auditing process must be to generate improvements that contribute positively to operational and strategic objectives. If this approach is taken by management, then the organisation will benefit greatly from the continuous improvements that an effective auditing process can deliver, enabling it to continue to perform to the best of its ability.

Aim Your Sights at Your Customers' Downstream Success

Copyright 2006 Adele Sommers

Do you strive to ensure that your customers enjoy downstream success? Are you mostly concerned with your own financial gain, or do you also express a desire to see that your customers will succeed? If it's the latter, are you consciously considering the success of your customers' customers, or even of your customers' customers' customers?

Without a plan for ensuring an ongoing chain of satisfaction, you can run the risk of developing products, services, or customized solutions that might fill your coffers but not provide any significant or lasting benefits to others.

The way we approach our projects can influence our customers' success. Too often, we myopically limit ourselves to deliver only the "first-line" requirements. In so doing, we think primarily about what our customers or clients asked for, even if it's not the most suitable fit for their own -- or their customers' -- intended needs.

And although it's commendable to listen to what our customers want, and to try hard to fulfill their stated desires to a "T," it's also possible to generate an incomplete or incompatible result based on superficial information. This article offers three ways to adjust our project vision from "20:20 hindsight" to "20:20 foresight" in this regard.

1. Consult Your Client's or Customer's "Crystal Ball"

This method involves more types of questions than you might normally ask about the downstream benefits your product, service, or solution will deliver. It entails querying your clients or customers about the results they envision from the product, service, system, training program, or whatever your project will produce for them, as follows:

* "Imagine the project results six months to a year after completion. What payoffs do you see for people in your organization? Describe the benefits in detail, and any limitations they may still be experiencing after everything is delivered."

* "Now imagine how your customers or clients will benefit in the same period. What improvements in your products and services do you believe you will pass along to them from this project? Will those improvements significantly enhance your clients' or customers' situations? If not, where are the gaps in the picture?"

2. Conduct Interviews at Your Customer's or Even Their Customers' Sites

In some situations, a customer or client may agree to have you interview people at their site or possibly at one of their customers' sites. This process can be considered part of an initial needs assessment. If you are providing an estimate for the project, you might even want to separate information-gathering into its own distinct phase.

When the possibility of onsite interviewing presents itself, the purpose would be to learn from as many different sources as possible how people perceive the situation that has led to the request for a solution.

Using the information gathered in this phase, you might acquire insights that will reshape the initial set of requirements the client had requested. This could be the case if you and your client ultimately determine that the requirements do not seem to address the client's -- or the client's customers' -- needs in the best possible way.

3. Use the "Persona Interview" Approach

This method is especially useful if your project entails developing offerings for mass consumption -- where there is no specific client or customer to please. It can also, however, work extremely well when you are working with a client, to help pinpoint specific kinds of concerns and options that would not have been readily apparent.

With this technique, you begin by identifying a few imaginary characters known as "personas." These characters embody typical customers of your products or services. Regardless of what you'll be creating, you'll want to make your personas as realistic as possible. Give them names, ages, genders, professional or personal roles, families and friends, hobbies, educational backgrounds, and major challenges, for example.

If the project involves creating a financial planning Web site, for instance, you might conclude that one representative visitor is a retired electrician with limited computer skills. In contrast, another frequent visitor is a computer specialist who likes access to "power user" shortcuts. The solution you design will need to satisfy each persona's preferred way of using the Web site, without complicating life for the others.

After I've identified two or three personas, I like to "interview" each one about how they are using my offerings, as well as the benefits they are receiving. (Note that I do this before doing any development.) I let them tell an entire story about their circumstances, company situation, personal concerns, or whatever else "comes up."

These "interviews" often reveal new ideas and angles to consider. Once, I used this technique to "find out" how people might respond to a new information product I was planning to create. To my astonishment, one of my personas disclosed that she was taking advantage of the licensing program I had developed to allow others to teach the material. Up until that point, licensing had not even once crossed my mind -- but you can be sure that I added it to my requirements list after that! This is a great example of how a downstream customer benefit can emerge in a persona interview.

Yes, these exercises do take some imagination. Once you start the process, however, you'll be surprised at how much you can learn about the benefits -- and any potential shortcomings -- of a product, service, or made-to-order solution as defined by your initial assumptions.

The point is that by using a variety of techniques to expose more of your clients' and customers' needs, you can pinpoint more completely the project, product, or service requirements. And by consistently emphasizing the downstream "chain of successes" that your customers and their customers will enjoy, you'll create perpetual value for all who use your offerings or your final project results.