Offshore Outsourcing RFPs: Are They Encouraging Copy and Paste?

Anthony — Tue, 17 Nov 2009 03:13:09 +0000

Are your offshore vendors' proposals original?

Recent blog articles from TheStrategicSourceror and SpendMatters challenge the need for traditional RFPs the cause suppliers hours and hours of formal proposal development, which, based on discussions we have had with suppliers, are enormous copy and paste exercises from other proposals. The gigantic responses can fill hundreds of pages, putting even the most astute evaluated into deep sleep. Are they worth the effort for offshore outsourcing projects? For vendor managers, the short answer is…

…yes. Yet, the outsourcing leader and vendor management team must focus the vendors’ efforts on essential elements that can be written.

A proper RFP should:

Clearly State Requirements – The vendors need to understand the work they are bidding on, including volumes, process, technology, integration requirements, performance specifications, training, quality efforts, and any other specific requirements.
Define the Pricing Model – Avoid apples-to-oranges pricing comparisons by clearly defining the pricing and pricing assumptions. Include a response grid to make it simple.
Include the Contract – Vendor pricing should be based on your contract template. Negotiated outcomes can lower the pricing, but should never increase the price. However, ask the vendor to identify areas requiring negotiation and their starting position.
Ask the Supplier for a Solution – Require the vendor to describe the solution they will provide, including transition planning, transition efforts, technologies, and business process characteristics. Business process flows are great ways of making the vendor process clear. Ask, “How?”, not “Do you?”
Allow Suppliers to Ask Questions – Despite your best intentions, offshore vendors will have questions. Give them an opportunity to ask them.

That’s it.

Then you need to conduct supplier presentations and, most importantly, visit the suppliers’ offshore locations and see how they perform the work today – while asking them how they would do it differently for you. If you omit the travel, you’re buying shoes without first testing them. Sure, you should pilot services, but pilots are expensive and difficult to reverse after you’ve given notice to existing employees or the incumbent vendor.

These face-to-face meetings with the actual offshore outsourcing team members your organization will work with (NOT the sales people) and real life viewing are similar to behavior and case interviews. You should evaluate every resource you meet and rarely assume the resources will improve. What you see is what you will get… use our site visit agenda to drive the meetings to create consistency among vendor presentations.

…and that’s entirely comforting compared to lengthy written (or copy and pasted) proposals.

Vendor Evaluations – Understand an Outsourcing Vendor’s Operations

Anthony — Mon, 10 Dec 2007 07:42:40 +0000

Outsourcing vendors’ sales executives make well more than $200k per year. Needless to say, if you have made the right choice to run a RFP despite the vendors’ sales team’s best efforts (sales teams never want objectivity, they want to sell based on their relationship with your executives), you can pretty much ignore much of the vendors’ written responses. Behind the scenes, a well-paid group of junior salespeople are busy copy and pasting responses given to other companies into your proposal format. Of course, a well-written RFP prevents much of this, and we’ll soon be publishing more on that topic, but needless to say, it’s fairly impressive how much sales jargon, three letter acronyms, and cryptic diagrams a vendor can jam into a proposal.

This is why site visits are essential. You have to see the actual operations management team that will process your work. The trick, however, is to have absolute control over the agenda, otherwise the vendors’ sales team will copy and paste their same lame material into a PowerPoint.

Here’s the agenda we suggest you follow, assuming you begin at 8am:
8:00-8:15am – Introductions and review the agenda (to be sure nothing has changed)

8:15-8:45am - Vendor corporate review, to ensure your team understands the vendor’s business and corporate structure.

8:45-10am – Vendor solution presentation, where the vendor walks through the solution they propose to provide you. They present the solution at the entry point of transaction processing to the end of the process.

10:00-10:15 - Break

10:15-10:45am - Interview the operations management team, the specific team members that will manage the flow and reporting of your transaction processing or call center. The key areas to focus on is the management team’s skills. Do they know what reports and metrics to watch? How often do they watch the metrics? What do they do if something goes wrong? Ask for specific examples of how they handle peak volumes, inventory backlogs and system outages. Understand how they build staffing schedules and ensure sufficient quantities of trained agents are available.

10:45-11:15am - Interview the recruiting team, the specific members that handle advertising, marketing, and interviews. Where do they source talent from and how does marketing and the vendor’s brand recognition compare to other vendors you talk to? Do they use any techniques or automated skill testing? Get a sense for the type of labor they employ: % of full-time, % of college graduates, location of most of the agents’ homes. What role do operations leaders play in interviewing? Do agents have the opportunity to see what day-to-day life is like? How do they source managers and specialty skills (e.g., workforce management)

11:15am-12pm - Interview the quality team. Do they understand statistical sampling? How do they track quality errors? How do they identify root causes? How do they ensure identified problems are permanently resolved? In many cases, you should be look for evidence of Six Sigma processes…and not just the mention of them. How many black belts do they have? Green belts? Ask them to see case studies of actual examples of six sigma projects in process or completed. Do the people giving the explanations understand what they are discussing?

12-12:30pm - Break and lunch.

12:30-1pm - Meet with the training staff. Seek to understand the content and length of the proposed training program. What components do the vendors add to the content (e.g., accent neutralization, industry introductions)? Are there sufficient numbers of training rooms? What level of accountability will training teams take toward developing and maintaining training materials? Ask about supervisory, management, and specialty role training programs.

1pm-1:30pm – Question and answer time.

Note that we excluded technology from the agenda. If you have an IT team member traveling with you, which you should, you should break them off during the middle of the presentations and have them meet with the technology team. They should seek to understand infrastructure, telecommunications, applications, and support. What is the vendor’s 2 or 3 year technology strategy plan? How often will they update desktops and other infrastructure elements?

Lastly, do a site walk through and understand how the vendor secures your area and how they support their agents.

What do you think of our sample agenda? Let us know!