Tips for IT Outsourcing
Our local small business owners here in Los Angeles are always on the lookout for innovative ways to get more done with less cash. IT outsourcing is one strategy that will help save time, money and disappointment. At GeekTek we’ve talked to hundreds of entrepreneurs who have learned how to effectively manage their vendors. These helpful tips will help you effectively leverage your relationship with external service providers.[checklist]
- Be clear about your project’s scope and timeline. Maybe this is obvious, all successfully outsourced projects begin with clear statements of work. Outline your project’s requirements at the beginning so your vendor has accurate and comprehensive guidelines. That way they can present reasonable proposals, pricing and schedules.
- Start off small. It makes sense to begin with small projects that are relatively simple in scope, so you can evaluate the vendor’s approach and skill sets before you trust them with a truly important project.
- Connect clearly-defined milestones with payment. Every good journey starts with a map. Create regular checkpoints to review the project’s status as it nears the end, so that your project comes in on time and on budget. A good rule of thumb is to pay no more than 20 to 30 percent of the total price of the project up front, and then the rest of the payments over time based on meeting three or four milestones.
- Interview your vendor just like you would a full-time employee. Don’t be afraid to ask questions — hiring a IT services firm is a completely subjective task. Call their references, getting feedback from their other clients. If you’ve got concerns, voice them. Simply hoping for the best is a dangerous way to run your business.
- Price shouldn’t be the only factor. Instead seek out true value; experienced business owners often throw out the highest and lowest priced bids. Then look for a balance of quality and value.
- Seek out a good fit. Hopefully the IT consulting company you choose will have experience with similar projects. Beware of being someone’s “guinea pig.” This is especially important for complex technical projects like cloud computing or VOIP setup.
- Study their portfolios and sample projects. Review examples of the vendor’s previous work to ensure it meets your needs and expectations. Ask them if they’ve worked in your industry — i.e. retail, manufacturing or the service industry.
- Don’t forget post-project support. Consider writing a warranty or support clause into the project contract so that you’ll have some ongoing support after the project’s completion. It’s better to negotiate this before the work begins, rather than after the the project’s deadline has come and gone. Specify how much free (or rather, included) support or discounts you’ll need ahead of time to save you headaches in the future.
Hiring an outside vendor can be the best way to have access to first-class expertise without the overhead of hiring full-time employees. Los Angeles small business owners can stay focused on their business, allowing them to compete with the big dogs while still maintaining their independence, while true professionals get the job done.