19/01/22

Do something different: Outsourcing for growth in 2022 and beyond

Neil Anderson

With uncertainty still hanging over the global economy, rapid and widespread economic growth looks unlikely in the near future. Businesses looking to succeed in 2022 and beyond will have to become the engines of their own growth.

Let’s face it – the much-heralded ‘return to normal’ (whatever that may have been) looks increasingly unlikely. The Covid-19 crisis is still causing both demand and supply-side chaos in economies around the world. And even as the pandemic ebbs and flows across different regions, it is clear that new business challenges are lining up to take its place – supply chain disruption, ongoing Brexit factors such as regulatory environments, fuel prices, wider inflationary pressures (including wages), and more.

So it’s clear that business growth isn’t going to be handed to any of us on a plate. Instead, the onus will be on companies to innovate – to do some thing (or things) differently to make their own growth happen.

And, as we are already seeing throughout the technology sector, that need to do something different is increasingly putting the spotlight on business restructuring and business process outsourcing.

 

Drive growth in 2022 (and beyond)

What will you do differently to drive growth in 2022 (and beyond)?

Driving growth with outsourcing

Outsourcing is a powerful tool for change at any time, but perhaps all the more so during times of economic turbulence and uncertainty. For technology companies, outsourcing technical service and support functions provides four powerful drivers of business improvement and growth for 2022 and beyond.

01 Reduce costs

An in-house technical service team represents a significant cost. As well as the salary costs you need to consider the costs of recruitment and training, a vehicle fleet, administrative support, specialist service systems, tools and more. As a fixed cost these can be a significant and unyielding drag on a manufacturing business. Once outsourced they become a variable cost that can be adjusted and managed as part of the gross margin.

02 Increase flexibility

The ability to adjust resourcing up and down has perhaps never been as important than now. With the pandemic creating so many unknowns, no one can really know with any confidence what the economic future might bring. Outsourcing technical service and support allows technology firms to constantly adjust their resourcing throughout this uncertainty to meet fluctuations in demand, service level requirements and budgets.

03 Focus resources

Technical resources often become stretched during downturns as manufacturers develop new products, seek and open new markets, improve manufacturing efficiency and more. Outsourcing allows technology firms to release their best in-house people to focus on these projects, safe in the knowledge that existing products and customers are in safe hands.

04 Improve service

Economic uncertainty does little to change the ever-growing demands of customers. In 2022 and beyond, technology customers will continue to look beyond product features and benefits to identify those products which are backed by first class support from initial dialogue to after-market warranty. Outsourcing service to a specialist team can transform service outcomes, providing immediate sales advantage and building a platform for long-term brand advantage.

 

Outsourcing technical services & support

So, assuming you do identify technical services outsourcing as a potential driver for growth and business improvement in 2022 and beyond, what factors do you need to consider in planning for effective change? Of course these can be complex decisions, but we would typically identify four key areas.
Qcom’s whole-of-life technology service & support model

A. Decide what to outsource

The first step will be to establish which part(s) of your technical services mix you could outsource. Whether you decide to outsource all (total outsourcing) or some (selective / targeted outsourcing) of these functions will depend on which and how many of the benefits above you are trying to achieve.

Then you will need to make sure that the services you are considering are clearly defined, with all workflow steps within them identified and properly understood. This will help you produce an accurate cost analysis, an effective brief, and confidence that the services proposed by the outsource provider match your business outcome expectations.

B. Decide how much to outsource

The next question is whether to outsource all of the functions you have selected, or whether to retain some existing in-house capacity for delivery and/or management?

An experienced specialist provider like Qcom will already have the management and reporting systems you need to outsource whole services with compete peace of mind.

But equally there is a big trend in outsourcing towards ‘borderless collaboration’, referring to relationships where an experienced member of the core staff is retained at the host company to manage the outsourcing relationship on an ongoing basis.

C. Put people first

Never forget that restructuring and outsourcing have real world impacts not only on the people whose roles are being outsourced but also on those who will remain within your business. So make sure a people strategy is a top priority.

Map out clearly how you are going to retain the people you need, how you are going to manage the transition to a new outsource relationship, where staff might be TUPE’d across (you can read more here on successful outsourcing with TUPE), and where redundancies might be unavoidable. Take specialist advice and consult as early as possible to make sure you get both the legal and reputational issues in hand.

D. Find the right outsource partner

There have never been more outsource service providers than now, so finding options shouldn’t be too hard. Do bear in mind however that a high proportion of these providers are generalists; business process outsourcers who will turn their hand to just about anything they contracted to deliver.

As I have argued plenty of times before though, technical service and aftermarket support is an essential component in your overall customer proposition – and one which is far too important to be left to generalist providers.

By choosing a specialist technical service and support provider like Qcom you can be confident that they will already have established processes and resources for frictionless implementation, engineering and technical expertise and high-quality customer service, as well as the reporting and review processes you will continue to need for effective management and continuous improvement.

Qcom has more than four decades of experience in this field, providing the technical, operational and service excellence required to help technology manufacturers achieve their restructuring objectives.

To discuss your own business restructuring and outsourcing requirements, please contact me at neil.anderson@qcom.co.uk or telephone +44(0)1905 827650 to arrange an initial conversation in complete confidence.

Or for more on the way outsourcing can help rapidly restructure a business for future growth, read how this global technology manufacturer outsourced its technical services and support to Qcom in response to changing product and market requirements.

 

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