Dangers and Risks of Outsourcing to the Wrong Company

Dangers and Risks of Outsourcing to the Wrong Company

December 29, 2021 Off By Deanna Coleman

While outsourcing administration tasks offers several benefits to a company that delegates part or all of their functions to a third-party vendor, it’s also not as promising especially when you have chosen the wrong company that will provide you the service. Therefore, the decision to select the right outsourcing partner is crucial to your enterprise’s success.  

For any serious entrepreneur, especially for newcomers in the industry, the thought of having a long-distance collaboration could be scary since at first glance, such remote working arrangement might be difficult to maintain. Then again, if trust has been earned from both sides, then companies will be able to enjoy the full advantage from outsourcing.

Outsourcing With the Wrong Company

First, you have to understand what this system is all about. Outsourcing is the practice of most businesses of opting to assign mostly their non-core functions typically done by in-house staff to an external service provider. While BPO companies can do the job on-site, in reality, the majority of them work from afar, that is, from a foreign country. And with that comes the various challenges companies looking to outsource will have to face.

Second, there exist diverse risks and dangers when you outsource to the wrong company such as but not limited to:

1. Communication Issues

If companies don’t speak the same language, there’s a problem. True, there are different modes of communication such as telephone calls, video conferencing, emails that are functional but nothing can be more effective than physically talking face-to-face.

Another is the problem of time zones. When your BPO company is located on the other side of the globe, then both of you must make a workable time arrangement so that no task can be hampered because of time. If fast and efficient communication matters to you most, perhaps choosing the external vendor nearest you or within the same district as yours is the better option.

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2. Lack or Total Loss of Control

No matter how you see it, but it’s certainly the outsourcing team that has control over the outsourced project once the deal has been made. This can affect the quality of the final output which may not be according to what you had in mind.

The problem even gets worse if the discussion is based solely on virtual communication just because the BPO partner is in quite a geographical distance. Actual monitoring and collaboration are the real challenges here.

3. Security and Privacy Concerns

Stealing or leaking out valuable information and business secrets is always a big possibility therefore you should thoroughly review the reputation, background and experience of the BPO organisation you’re going to choose.

The wrong outsourcing partner could not really be trusted when it comes to copyrights, trade secrets, privacy, intellectual property and more. And worse, if the third-party provider based abroad has no respect to your own country’s laws on the above-mentioned. That said, before choosing to outsource, learn all the ins and outs of it beforehand.