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Mitigating Risk in Document Outsourcing: How to Transition Services Smoothly

Whether you are a company that is testing the outsourcing waters for the first time, or moving away from a long-term partner – the transition phase of any outsourcing agreement can be a difficult time for stakeholders on all sides of the partnership.

When a relationship between an outsourcing provider and their client sours, it is often because of problems that developed during the initial transition phase of the relationship. In fact, a 2012 Global Outsourcing and Insourcing Survey, conducted by Deloitte Consulting LLP, states, “66% of executives who responded to the survey stated that their outsourcing arrangement had been ineffective, cited issues during the transition as a main reason why desired results were not produced.”

But the potential pain points that can pop up during the transition phase of a document outsourcing agreement should not stop any company from considering this type of solution, because they are highly addressable.


To avoid these transitional risks, they must be pinpointed, evaluated, prioritized, and addressed with effective mitigation strategies. As a company that has executed outsourcing transitions, across dozens of industries for hundreds of clients – Novitex has compiled this outsourcing transition-focused article, detailing three effective strategies companies can use to mitigate the risks associated with the onset of this particular type of business relationship.

Risk #1: Ineffectual Data & Knowledge Capture or Transfer

The knowledge transfer process can be complex, and the level of information gathering required for a successful transition is often underestimated. Even if the directive to outsource is to improve various business processes, the current workflows and business processes in place should be documented by both the client company and incoming outsourcer, and carefully analyzed by the outsourcer before recommending or implementing any changes.

Mitigation Strategy:

There are any number of reasons why knowledge capture and transfer can fall through the cracks during a transition phase – lack of documentation, or legacy workers who may now be unsure of their job status, as a pair of examples – but there are ways to keep the focus firmly on the capture and transfer of knowledge during this phase. Some of these include:

  • Work with a provider who takes the time to conduct due diligence during a formal discovery period
  •  Implement a knowledge transfer program that includes all stakeholders with process-specific knowledge
  • Make sure this process starts on schedule
  • Create buy-in by recognizing that a purposeful knowledge transfer will affect the success of the entirety of the outsourcing agreement

Risk #2: Lack of a Formal Transition Plan

Albeit a temporary one, transitioning any number of business processes off of your own docket and onto that of an outsourcing partner is a project that needs management like any other one. A well-thought-out plan can help prevent many of the organizational or operational differences that can derail an outsourcing transition. Showing senior management a solid road map to overcoming any differences between client and provider can help address fears that can slow the processes themselves, while also streamlining the actual workflow. Some tips:

Mitigation Strategy:

  • Map out how the outsourced process will look post-transition
  • How oversight will look, and who will own what responsibilities
  • Demonstrate that potential issues have been identified, and effectively planned for

Risk #3: Lack of Key Point Indicators or Other Performance Measures

If the markers of success are not well defined, it is unlikely that it will ever be reached. From the outset of the outsourcing agreement, goals for performance improvements, cost savings, or other benchmarks should be set and measured accordingly.

Outsourcing represents a very straightforward link between operations, and cost savings. Any worthwhile outsourcing partner will take the lead on these areas, including reporting, and handling their assigned operational areas in a best-class manner. But, taking a completely hands-off approach to oversight, especially during a transition phase, is not the right approach. Working together to identify and set benchmarks, develop SLAs, and then measuring and comparing those results against former ones is a straightforward way that both sides can use to help ensure desired results are provided.

Mitigation Strategy:

  • Put a solid benchmarking framework in place where your organization and your outsourcing partner will identify all KPIs for all functions, and identify which ones support your key goals
  • Use these KPIs to drive growing, sustainable value out of the outsourcing agreement – using them to measure effectiveness and to become more efficient overtime
  • Hone in on the strategic business goals that will benefit your business the most from business process outsourcing experts

Outsourcing is a well-proven, straightforward approach to create cost savings for your enterprise. It is also a way to gain access to best-class equipment, and expert thought-leadership to better handle areas of your business that fall outside of core, revenue-generating work. And while any outsourcer worth working with will take the reins on driving process improvement, conducting the work, and measuring their performance – the best outsourcing agreements start on the most solid foundations. Take the steps above to mitigate the risks during your outsourcing transition, and enjoy the benefits of that well-established foundation for years to come.

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