"Expectations Management" in IT Outsourcing

Steps to ensure maximum returns in offshore outsourcing

Expectations management has come a long way since the first boom of offshore outsourcing. However, there are still pitfalls and miscalculations in drawing up expectations. These steps will help both outsourcing buyers and providers with some food for thought to ensure effective expectations management and subsequently, higher returns on investments.

IT Outsourcing buyers
It is important to have a clear set of expectations for inside your. The information channels should be established from the beginning. If outsourcing is expected to solve an internal problem, the provider must be told. Specific designations of who will do what and at what time are important.
Ask yourself key questions like:
• What specific work do you want to outsource
• What kind of business relationship/deal do you want?
• What are the outcomes you want to accomplish for your organization?
• How will the relationship benefit the providers(s)?
• What do you see as the matrix of responsibility in relation to yourself and your outsourcing provider?
It is but natural that some issues will change in negotiations but it is best to begin with clarity. This will help prevent misunderstanding in the future.

IT Outsourcing Providers
A study by an independent agency showed that 67% vendors considered managing expectations an important factor in outsourced project success.
Outsourcing service providers should not promise what they cannot deliver. They should proactively determine a client’s requirements and expectations of an outsourcing relationship, provider capabilities and state upfront what is correct. Nothing is more damaging in an outsourcing arrangement than raising expectations which cannot be met. Never make assumptions: sometimes companies and suppliers both make assumptions that cause difficulties in the partnership. Communicating provider’s capabilities is the key to successful outsourcing. Similarly, knowing precisely what are client goals and objectives goes a long way in helping draw effective expectations management points.

Finally, to assure performance will be measured against original expectations, it is important to develop mutually-agreed upon measures early on and put them in writing.