Uncommon Strategies for a Successful BPO Partnership

This is the second article in a series on outsourcing. You can find the first article here: When is the right time to outsource?

Over the years, I've developed strategies that may be uncommon for managing outsource partnerships alongside an in-house team. Crafting a successful outsourcing strategy isn't just about finding the right partner. It's also about shaping the relationship in a way that aligns to the goals of both organizations.

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Strategies for a successful partnership:

1. How to Treat the Relationship: Creating Alignment

It's important to give your BPO partner the information, support, access to leaders / peers, and training needed to be successful.

In the past, I had a partnership that was kept separate and not discussed widely. They weren’t included in important communications and didn’t have direct access to our internal team. This approach led to the BPO missing key information and created mistrust between teams.

Now, we think of our BPO partner as an extension of our team. They are included in chat channels with our team, they have access to the same Knowledge Base articles, and they are included in the same necessary communications that our internal team members receive. ?

Many make the mistake of treating the relationship as a zero-sum game where the client always wins and the BPO partner always loses. Then they wonder why the relationship falls apart. Fostering a relationship built on mutual success, rather than one-sided gains, are better for everyone long term.

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2. How to Position the Partnership: Transparency is Key

?The word “outsource” is scary to your team. It’s important to communicate openly with your team about the role your BPO partner will play. Make it clear that they complement, rather than threaten, existing jobs.

In attempts to address these concerns, we created a knowledge base article that discusses the relationship and clearly states they are not a threat. We try to consistently reiterate this idea, communicate when things are changing, and why.

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3. Start Small, Grow Thoughtfully: Test the Waters

I’ve seen things turn sour when a partnership grows too quickly. I prefer to start with a smaller / simpler task that adds sufficient value. This helps avoid overwhelming situations that could jeopardize the relationship and erode internal confidence in the partnership.

Years ago, I grew a BPO partner too quickly. Initially, it brought needed relief to a difficult situation. However, we quickly learned we weren’t prepared to provide the necessary support to a large team that was still learning complex subject matter. As the volume of mistakes grew, our internal team quickly lost faith in the partnership. Trust me, this is a situation worth avoiding.

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4. Not Outsourcing 100% of Anything: Mitigating Risk

I learned the hard way not to put all my eggs in one basket. Outsourcing 100% of any task / channel / product carries risks. Your internal team can lose expertise with that part of your business and you become vulnerable if the relationship fails. Building a partnership on trust doesn’t mean you shouldn’t safeguard against risk.

Let’s say your partner manages 100% of your chat channel and your internal team handles 100% of voice. If things with that partner go south, you are in trouble. You don’t hire for written communication skills, you may not understand the nuance of that channel, etc. Insourcing while trying to rebuild expertise at the same time is a difficult position to be in.

An exception I’m willing to make to this is allowing my partner to manage 100% of the “overnight” shifts. If we have a problem, we can temporarily adjust our hours of operations, so it’s not nearly as consequential as the previous example.

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5. Rules Around Terming the Relationship: More Risk Mitigation

Even when we set the relationship up for success, things can change. When establishing the relationship, it’s important that you set clear rules around terming the relationship that protect your business.

While you may not hear about it often, sometimes a BPO fires a client. I once had a partner that shifted 100% of their business to collections. The contract only required them to provide us 30 days’ notice which left us scrambling to onboard 100 employees in a matter of weeks.

On the flip side, you want the ability to change or end the relationship with reasonable terms. People often focus on language around term for cause, e.g., poor performance. I would also recommend a “term for convenience” clause and/or the ability to change headcount without restriction. A “term for convenience” often requires you to pay a penalty on top of regularly billable fees.

In 2020 when COVID was decimating businesses, we had a massive drop in workload and needed to manage our costs. Luckily, our contract terms required no minimum headcount, and we were able to reduce our partner to 0 heads temporarily.

A successful outsourcing strategy involves careful consideration of the relationship dynamics. By treating your BPO partner as an extension of your team, being transparent with internal stakeholders, and mitigating risks, you pave the way for a partnership that not only meets current needs but also adapts to future challenges.

I hope you enjoyed this article! You can find more content like this from me and other members of the Vistio Knowledge Collective here: Vistio.io/Knowledge