How to Finalize an Outsourcing Contract

You have identified the tasks that need to be outsourced, interviewed outsourcing prospects and have narrowed down your choice to the most suitable for the job. What steps can you take to effectively finalize the outsourcing contract?

Step #1: Create a Contract

First, you need to draw up a contract that will spell out the task, expectations, deadlines and pay rate. You need to ensure that the agreement is well detailed and clearly spelt out, so that there will be no room for assumption and misinterpretation.

This is particularly necessary when it comes to expectations in terms of the quality/quantity as well as deadline. Also, don’t forget to integrate elements for recourse as well as remedies as a measure to take care of unforeseen circumstances.

Another feature you should include in the contract is a clause that takes care of possible revisions to the outsourcing agreement. Generally, you should speak with an attorney regarding these forms of legal steps in the contract.

It is important that both parties (you and the outsourcing partner) go through the contract agreement carefully and understand its contents before appending your signatures. The whole essence is to address any concerns and questions adequately prior to finalizing the outsourcing contract.

Step #2: Stay in Touch with Your Outsource Partner

Drawing up a contract and signing it off is not the end. You need to stay in constant and clear communication with the vendor. Request for status report on a weekly basis. That’s not all, you should embark on conference call or video chat to hold meetings, so that you can furnish each other with vital information about the outsourcing relationship and task.

For offshore outsourcing that involves substantial time zone difference, look for a way to maximize the time-zone difference. Typical example is having the vendor work on tasks that are time-sensitive.

Step #3: Give Room and Time for Adjustment

Don’t be stern and so strict from the very start in terms of the work progress. You should give the outsourcing provider some time to adjust and progress with the task. Even the most professional and experienced outsourcing provider will take a bit of time to adjust and carry on with the outsourced task.

Bear in mind that the employees working for the outsourcing companies also need a bit of time to learn your business practices and study the scope and specific requirements of the task. So, give room for that transition to take place successfully. Don’t be in a rush and do not rush the contractor, so that you don’t end up with a rushed outcome.

Finally, resist the urge to micromanage the outsourced tasks, so that you are not distracted from the core tasks you should be focusing on. As long as you’ve performed due diligence in choosing the right outsourcing provider, you should be rest assured that things will work out as expected.

Daven Michaels is a New York Times Best Selling Author and CEO of premiere global outsourcing company, 123Employee. The company employs hundreds of young bright individuals on three continents. His International event, Beyond Marketing Live! inspires entrepreneurs to build & grow their business with revolutionary new theories and systems allowing them to design the business and personal lifestyle of their dreams.

3 comments on “How to Finalize an Outsourcing Contract

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