You're navigating the IT Outsourcing industry. How crucial is feedback for sparking innovation?

The feedback loop is instrumental in making or breaking an outsourcing project/ relationship. The most successful sprint based outsourcing projects are simply those that have a very transparent and nearly constant feedback loop in place. No feedback and the project will fail. In waterfall models, where it is still being applied, feedback is still critical but it need not be constant as long as the exit criteria is written clearly and understood equally by both sides. Feedback is also critical wrt the non-deliverable aspects of the project such as schedule, budgets and acceptable quality. There are and need to be, multiple stakeholders involved in the successful execution of any outsourcing project where the TPM is just one of them.

The feedback meetings should be properly planned and scheduled on regular intervals e.g. 1-Month or 3-Months. To make feedback constructive, there both the party needs to set the parameters on which they should respond to each other, for example: Speed, Quality, Communication, Updates, Satisfaction etc. - they need to be given ratings along-with comments for changes and improvements. Feedbacks doesn't just bring improvement in work but it also helps strenghten relationships as well - and plays crucial role in maintaining long-term relationship.

Innovation in outsourcing is a double edged sword. Speaking from experience, there are instances where when innovation is being driven by the vendor, is not accepted. This could be due to a variety of reasons. Some are related to product roadmap that the client may know more of but the vendor, not so much. As such innovation may not be in line with the roadmap. In a multi vendor model where different aspects of the project are executed by different vendors, innovation can be stymied due to competition between vendors. Then you also have issues related to job security where the client may not approve of changes that could show him/her in poor light. Innovation works great when the relationships and expectations are clearly defined.

Everybody's dream is to be innovative at work, but when it comes to the investment of money and time - then both the parties focus in mainly on achieving the deadline and finishing what is on the tray first. So, between two outsourcing partner - such discussions and plans rarely takes place, however, being in outsourcing industry, each individual definitely can make efforts to bring innovating solutions for more better productivity at low costs, especially with AI. The outsourcing companies therefore needs to have research and development activity going on, side by side - beside their routine business activities.

Many of the vendors believe that the satisfactory and quality outcome is solely the responsibility of the provider in outsourcing. But that's not 100% true. It is both's responsiblity. And, the communication is the key that both the parties have to use maximum in order to get any projects delivered successfully. Feedback is not an add-on of the communication, but its a necessity to get expected outcome. Without constructive feedback - it is rarely possible to expect any satisfactory or out-of-the-box outcome.

In my experience, constructive feedback doesn’t just maintain quality—it actively pushes it forward. By clearly communicating what meets your standards and where improvements can be made, you give your outsourcing partner the opportunity to innovate and adapt their approach. This can lead to the discovery of more efficient processes or new solutions that enhance the overall quality of work. Regular, thoughtful feedback fosters a collaborative atmosphere where both parties can thrive, ultimately leading to sustained improvements and innovation that keep you ahead in the industry.

This couldn’t be closer to the truth. If a relationship becomes transactional, then it will fail. An Outsourcing relationship is a marriage where you have to share the goals transparently and then work collaboratively towards achieving those goals. Most client companies look at this relationship from a purely financial perspective where they try and put one vendor company against the other. Not that it is wrong, all the time. They should do so if they find that their vendor has not been responsive, is averse to quality, is charging exorbitantly and is letting the relationship run on autopilot. It is easier to meet your goals by having an open and trust based relationship with your vendors rather than publishing RFPs repeatedly.