Staff Outsourcing: Screening and Selection of Service Provider

The need to Outsource becomes an option when businesses require expertise or skills that they don't have within their organization to solve the problems and challenges the company might be facing. Outsourcing is the contracting out of a business process to a third-party. It is contracting with another company or person to carry out a particular function. Basically, the function being outsourced is considered non-core to the business or back office roles. The outside firms that are providing the outsourcing services are third-party providers, or as they are more commonly called, service providers.

The processes involved in outsourcing contract, generally encompasses five stages starting with the identification of outsourcing opportunity in the organization, assessing business case of the company, evaluation of vendors’ proposals and selecting the best fit for the service to be outsourced, contract agreement and engagement of the service provider and finally renewal of contract if service is rendered satisfactorily or exit if otherwise.

Steps to Screening and Selecting a Successful Vendor:-

1. Analyze the business requirements: In analyzing the business requirement, the first task that the vendor selection team needs accomplish is to define, in writing, the product, material or service that the company is searching a vendor for. The technical and business requirements should be explicitly defined and also the vendor requirements.

2. Vendor Search: The next step after analyzing the business requirement is to search for possible vendors that will be able to deliver the material, product or service. Of course, not all vendors will meet minimum requirements and so the company will have to decide which vendors you will seek more information from. Thereafter a Request for Information (RFI) should be written and sent to the selected vendors. Finally, evaluate the vendors’ responses and select a small number of vendors that will make the "Short List" and move on to the next stage.

3. Request for Proposal or Quotation: The third step is to develop the RFP (Request for Proposal) and RFQ (Request for quotation) to be sent to the short-listed suppliers.

The RFP outlines the engagement’s requirements — relevant skill sets, language skills, intellectual property protection, infrastructure, and quality certifications — and gives prospective vendors the information necessary to prepare a bid. 

4. Due Diligence/ Proposal Evaluation: Due diligence supports or validates the information the vendor supplied on processes, financials, experience, and performance. It helps to determine vendor’s project management, the level of success achieved, the quality and standards of work delivered, adherence to contract terms, and the communication process. Reliable, ongoing communications, especially in offshore outsourcing is very important; potential pitfalls can result from infrequent or vague communications.

5. Test Project (Optional): The test project is to ensure a good fit between the company and the vendor. These tests allow companies to review the vendor’s project management process for efficiency and effectiveness. Specifically, they look at whether project execution is completed within guidelines, whether deliverables are timely, and whether the vendor has adhered to defined quality standards. Tests serve as a good method for companies to check and review the facts before making a final vendor decision.

6. Vendor Selection:  The biggest step in the process of selection is picking a service provider to manage business processes and applications. Making the final decision means signing a contract that clearly defines the performance measures, team size, team members, pricing policies, business continuity plans, and overall quality of work standards.

StreSERT Services Limited, recognizing the intrinsic value of outsourcing in that it removes the burden of having to manage back-office functions so HR executives and departments can focus their attention on business processes and strategic initiatives provides outsourcing services to various corporate organizations in different capacities. To this end when you choose StreSERT Services, you get more than a provider; you get a partner who will add value and help you achieve high performance by deploying and managing personnel in various positions/departments.