Training your new employee to understand outsourcing: have you considered this?

Imagine you’ve just recruited a new employee. He or she is new to the outsourcing industry and you need to introduce them to this world. What would you do?

Most firms will do the following: Put together an induction program in which the newcomer is introduced to the organization, followed by more specific training on ‘how we do outsourcing in this firm.’ The ‘outsourcing’ induction will be about the firm’s philosophy and methodologies, and will include some examples from experienced people. On rare occasions, the firm will invite an outsider, like me, to offer exposure to practices carried out at the industry level.

Is there something wrong with this approach? Probably not, but your newcomer still doesn’t know much about outsourcing, having spent 2-3 days in class listening to lectures and from time to time engaging in an academic team exercise to solve a business problem. In other words, your newcomer will still wonder what the ‘real’ outsourcing world looks like. Furthermore, you just invested 2-3 days of very un-memorable training in your new recruits. What does that say about your branding?

You may tell yourself that there’s no reason to worry, your new recruits will gradually learn about outsourcing as they join a project and work with more experienced people. True, but you could do so much better, instead of the rather ‘boring’ induction. Just think about spicing up your induction with a real-life outsourcing exercise that could have enhanced your recruit’s learning and given them a real flavour of the outsourcing reality without them having to leave the building.

We call this exercise: the outsourcing experience.

Many outsourcing practitioners don’t know about micro-sourcing, but there is a thriving marketplace which is growing fast and making outsourcing possible in small scale projects. This marketplace for talent is made of several platforms, where buyers and vendors meet to agree on the conditions upon which a rather small project or task will be accomplished and delivered. The line of tasks carried out in this marketplace varies from programming to transcribing, editing and even art design. Together with Professor Levina, Professor Carmel and Professor Kotlarsky, I have developed a real life outsourcing training exercise that I use with our students to bring the outsourcing experience into class.

In this exercise, I ask students to think about an application they would like to have. I give them a budget to work with (about 40-50 USD per team) and a timeline to complete the project (about a week with the expectation that a team of 5 students will spend about 30 hours on this exercise). The application can be for their smart phone or on their computer, but it has to be an application. Once they have decided on the application, they need to use one of the microsourcing platforms (e.g. vworker or elance) to eventually contract with a programmer who will develop this application for them within the time and budget specified above.

Many projects carried out by my students did not meet their targets and most faced significant difficulties. But such observations are not big news for those of you with experience in the outsourcing industry, and this is exactly the point of this exercise as a training tool.

Not surprisingly, many of the pitfalls my students experience in these small-scale projects are the same challenges that large firms face with their mega outsourcing deals. Just to name a few: poor specification of the application; high expectations regarding the vendor’s ability to understand your specification; skipping critical stages in the preparation for the outsourcing deal; unstructured and chaotic vendor selection process; lack of checks and balances throughout the relationships (reactive rather than proactive mode); and on-going changes in the applications with the hope that the vendor will carry-on applying goodwill. While not all student teams could demonstrate the functionality of their application, all students have learned in one week what it means to manage an outsourcing project, what it means to be a client firm, and how they should have managed their vendor.

All students were thrilled and excited about the experience and recognized the relevance of outsourcing methodologies and practices in their textbook. In one week, they understand the essence of what outsourcing is!

So what could outsourcing vendors, client firms and intermediaries do as part of their induction?

The Professor’s Advice:

Design your induction to include a real life outsourcing experience. Start by asking your newcomers to think about a business application that can benefit the firm and let them do a benchmark exercise to figure out the costs and time it will take to develop it in-house. Then ask them to outsource the development of the application through one of the micro-sourcing marketplaces. Set up cost and time targets to challenge them and ask them to write a blog that describes the outsourcing process. Once the outsourcing experience has been concluded, bring them together and let them share their experiences. Let them reflect on the mistakes done, and ask them to look for in-house or industry outsourcing practices that could have helped them avoid some of these mistakes. Last but not least, give the best performer a nice prize!