There are a number of misleading notions that are being circulated regarding outsourcing. This article explains why each outsourcing myth is not true and the reason why it is a myth.
1. Myth: Outsourcing will solve all your problems.
The first outsourcing myth is the biggest. If you have problems in your business, outsourcing does not magically make them go away. For example, I had a client that was considering outsourcing customer service because their employees were not able to keep up with the call volume. Instead of hiring additional employees they were considering outsourcing. Upon analyzing the call logs, it was discovered that a majority of calls pertained to the software interface for the product (it was confusing and poorly designed). The problem was a poorly designed interface that was causing a large amount of support calls. Outsourcing would not have solved that problem. It would just move the problem from one place to another.2. Myth: Outsourcing companies will do it better than you can.
There is a perception that any company that performs outsourcing will do it better than you because they specialize in it. True, they are motivated to deliver quality service. But, after the contract is signed (i.e. their price is fixed for the next 2 to 5 years) their motivation is to reduce costs in order to maximize profits. Their shareholders are not your shareholders. It is possible that the extra money you spend on that back-office service is what gives you the edge over your competitors.3. Myth: Outsourcing will save you money.
The other perception is that any outsourcing company can also do it cheaper than you. A majority of this depends upon how well your company negotiated the contract. If the contract contains limitations or maximum levels, penalties may start to be assessed. Suddenly, that “fixed price” contract turns into an outrageous financial obligation of the company.
