Mitigating the IT Outsourcing Risks

Outsourcing may be the best thing that may have in the world of technology but one cannot overlook the potential risk factor that is associated with the process. While the benefits of outsourcing are many, there are naturally going to be certain risks with the process. From the loss of control on processes and management to impact on overall quality and other inevitable sudden costs, the list may be stretched to a great extent. The IT outsourcing world is changing rapidly and with more and more providers making their debut into the picture as well as IT companies opting to work with different services providers, the level of risks only seem to increase. But every problem does have an acceptable solution.

Mitigating the IT Outsourcing Risks

There are few ways by which IT companies may mitigate the risk that seems to envelop their process and here are the top four IT risks and their possible solutions to contemplate, execute and complete an IT process successfully:

1. Loss of control over their process and management: On outsourcing, you actually land up losing some control over your process when a service provider starts handling the affairs of the process. In short, project management is in their hands. They are in charge of internal staffing, a greater part of the decision making and other IT functions. The risk factor here is that the business establishment and the key people involved here aren’t really connected and the latter often isn’t active enough when it comes to managing the day-to- day affairs. Potential issues erupt only when businesses and the outsourced IT providers aren’t working on similar lines. Risk factor escalates here and the lack of adequate and clear communication leads to further issues. The risk prevention steps taken here will help determine the future of the project. Firstly, it is necessary to plan the process along with the service provider. Timelines for meetings, updates and any other issues that may crop up in the future, the plan that may be used to tackle the issue, all of these must be communicated perfectly between the business and the service. It solves almost 90 percent of the potential issues that they may have to face due to the lack of a proper communication channel.

2. Quality Matters: No matter how hard you try, nobody can understand a business like the way its owners, key personnel, and other important staffs understand. May be, that’s the reason why most of the IT service providers don’t understand the depth of the entire scenario. When it comes to outsourcing remote IT services, an uneasy sense of skepticism takes over.  The ever intimidating worry as to whether the service provider will be able to understand the depth of what the business expects out of the process lingers. The only way to mitigate this risk is by doing a detailed check of the potential service provider before striking a deal. While negotiating, every service provider is only going to portray an incredible image of themselves but what proof do we have that all that is claimed stands true? It is advisable to connect with at least three or four companies that have been associated with the service provider. Their opinion will help you have a deeper insight about your future associate. If the service provider hesitates to provide you with the details of their past clients, make sure you get cautious at that very point! It’s a red flag.

Related Post: Why You Should Hire a Dedicated IT Development Team and How to Make it Work Remotely?

3. Hidden costs and the risk factor: Cost played and continues to play an important part in the outsourcing process. IT service providers reduce the internal staffing and infrastructure based cost making the process and the idea of outsourcing a viable option. Another reason is to manage the overhead costs involved in maintaining the hardware and IT maintenance costs. Risk assessment is a homework that has no shortcut. Hidden fees for any purpose may also be considered here. Service Level. Agreements or SLA are the only way to insure your business from potential risks. Questions with regard to after work hour’s service, the upgrade costs, the overall consulting cost include new software cost, etc. must all be addressed until satisfactory answers are provided. It decides the quality of the relationship you enjoy with the service provider.

4. The Legal Aspects: Intellectual Property Rights are yet another concern when weighing the risks involved in outsourcing. It is imperative to protect the company from a potential software theft from the service provider. A confidentiality agreement should be signed by both, the business and the service provider to ensure that important, highly delicate information with regard to the project is safeguarded from hackers or any such persons with mala fide intentions. This includes the entire core team involved in the development process. Though a rare incident, it is always beneficial being covered against such issues.

5. On a parting note: Risk assessment is an important part of the outsourcing plan. In fact, a lot more important than the process itself because your process must be developed and implemented safely with the high quality and standards. It must be taken care of at the initial stages to avoid any such issues that may hinder the progress of the development. It is the company’s job to take the initiative in case of risk assessment of the service provider.

Your prudence at the initial stage will shape the future of the process. Mitigate all possible risks with a smart plan. In case you already are in search of an IT service provider who shares a great reputation, you are just an email away from their incredible services! At Your Team In India, we believe in transparency and honest relationships and our satisfied clients would surely vouch for us. Drop us a line at Let’s perfect your tech story together!

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