SI Review: April 2012

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Expert’s Corner

Operation Offshore

How to make the initiative a success

By Brian Cotter

While outsourcing has been around for decades, staffing companies have only recently begun to embrace the trend. As a result, off shore recruiting is still a pretty new concept, and most of what we know about it we probably learned from speaking with our peers in the staffing industry. Companies that make the headlines are driving clear and quantifiable results from their outsourcing efforts, such as 15 percent EBITDA improvements.

While that’s exciting news for staffing executives looking to combat shrinking margins, it’s going to take some careful planning to achieve.

As co-founder of PSG Global Solutions, a large provider of off shore support to the U.S. staffing industry, I have developed a detailed set of guidelines for making an off shore engagement successful. The points in this article highlight the key themes from those guidelines.

Achieving the benefits of a new initiative requires significant upfront planning, and ongoing oversight to make sure it fits into your business appropriately and that your team is using it correctly.

If you are careful to think through where to best utilize off shore support, how to best implement and manage it, and how to get your team to embrace the new project, the results will be night and day from what you will get if you take the “fi re and forget” approach.

Start with Success

A core principle of outsourcing is to figure out how to effectively run a process internally, and then transition it to an outsourced partner. There are two key reasons for this:

You need established performance benchmarks. If you try to off shore work that you haven’t successfully done before, you’ll have no way to benchmark performance. If you get great results, you won’t know whether you have a terrific offshore team, or the job orders just happen to be easy to fi ll. Likewise, if results lag, it’ll be tough to tell if it’s a difficult client situation or subpar personnel. With internal experience, however, it’s easy to calculate the progress and success of an off shore effort.

You need to be able to explain the work. Starting an off shore project is like bringing on a new team of employees. You need to invest to train the team on your processes, coach them on their results, etc. If you assign them to work you haven’t successfully done before, it will be much more difficult to do those things.

Part of the Team

If you just opened up a new office or hired a new team, you’d give them feedback, coaching, training and access to the same tools you provide the rest of your staff . Do the same with your outsourced team and you will see significantly better results.

Decision-Maker Engagement

Having a decision-maker engaged in the effort is critical to success. He or she should be in the loop of what’s happening, participate in regular updates and serve as a champion of the effort. As with any change in an organization, it’s important that people know the senior team is committed to the project. If the broader team knows that an initiative is important to the company’s executives, it will be important to them as well. Additionally, the decision maker may have goals that aren’t as relevant to folks who may not have P+L responsibility. If the decision maker stays engaged, they can ensure that the project is progressing appropriately toward those goals.

More and more staffing companies are enjoying the margin and flexibility benefits of a well-run off shore support program. You can too. But a word of warning: Don’t assume that great results can be achieved by simply signing up and waiting for your margins to grow; the reality is that it requires careful planning and execution.

Brian Cotter is president and co-founder of PSG Global Solutions. He can be reached at bcotter@psgglobal.com.

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