22 Nov Outsourcing: Partnerships VS. Service Providers
Outsourcing: Partnerships VS. Service Providers
Outsourcing marketing procurement, production, strategy, or execution can be daunting. It is a pivotal element of any business and as a result many organisations are keen to keep it wholly in-house, often to extreme extents.
The keys to a successful outsourcing project are partnership, collaboration, transparency, and continual improvement. Whilst these factors sound great, to deliver them requires identification of the right partner, trust, and a common set of processes.
This article will look at some of the areas and techniques to yield the best results and add the most value to outsourcing partnerships. Indeed, with the current macroeconomic circumstances, partnerships with suppliers are more valuable now than ever to many firms.
Service providers vs. partner
An important distinction to make is between a service provider and a partner. Webmart, for example, acts as both for different customers depending on their requirements. But we much prefer to work in partnership with our customers. Why? Because it allows us to add more value, leading to a greater return on investment for our customers.
To provide an example from our world of print and marketing services, an interaction with a service provider may start with a question like this:
‘We would like 50,000 double sided A5 flyers on 150gsm silk stock delivered next week, please.’
The service provider then quotes the job, produces it, delivers it, invoices it, and job done.
By contrast, a partner-based relationship starts with questions like:
‘We are planning on inserting something into our dispatch boxes to help cross sell complementary product lines as we’re having a hard time getting the relevant lines in front of the right people, do you have any suggestions?’
In this instance, the partner is then able to add value based on their specialisms and experience. For us, we would then be able to look how the other channels would work in conjunction with these inserts, help advise on format, creative, calls to actions, A/B testing, marketing attribution and so on. While the initial output and the financial cost to the customer might be the same or similar, the value gained from the partner is significantly greater than that of the service provider.
Even just framing questions in this way to your key suppliers will help in building up a more valuable relationship for your business.
As part of a partnership relationship, collaborating on projects is key. Ensuring effective collaborative relationships starts with choosing the right partner. Many procurement activities conducted to identify suitable suppliers/partners will focus very heavily on cost. Whilst this can make sense for the procurement of more homogeneous products with limited scope for value add, it usually doesn’t make sense for things like marketing and creative services.
Instead of focusing heavily on cost, look for cultural fit. A partnership with an organisation who shares the same values as your own, and operates in a similar fashion, is often the catalyst for successful and effective collaboration.
Once selected, involving the partner as early as possible in the relationship is an easy step to take to allow them to add value. Instead of going to them at the end of the project for execution, allow them to be involved earlier so they can add more value throughout the development phase of the project.
Repeating this process across a few projects will enable you to quickly assess the true value the partner can provide. If they’re really good, they’ll even show you how to measure that value.
Trust is obviously pivotal to building a long standing and productive partnership. To facilitate trust, transparency is a very easy way of proving value and fostering trust between customer and supplier. Often, transparency is requested of the supplier during a procurement exercise, but not offered in return. Not allowing two-way transparency in the relationship mitigates the value the supplier can add to your business.
Of course, both sides may have commercially sensitive information which needs to remain confidential, but scoping out what is and isn’t included in that will help to set expectations and ensure both parties have access to the information they require.
Two-way transparency also allows the supplier to become an extension of your existing marketing/procurement function, adding team members who are not on payroll and are experts in their specialisms. This is a powerful tool for adding skills to your business without extensive financial outlay – all facilitated through transparency.
Maximise the human
Once you have selected a suitable partner and worked with them on several projects, the next stage is maximising the human elements of your internal and outsourced marketing procurement function.
We generally achieve this through technology; using systems, processes, and platforms to augment the service we provide to customers. These processes remove tasks which humans do not add any value to (think reporting, invoicing, general paperwork etc). Automating these tasks free up time for your employees and your partner’s employees to spend more time doing the things they uniquely add value to. In turn, this drives performance and return on investment for both parties.
Try framing your enquiries to suppliers differently and earlier in the process and see what happens. This is the first step in moving away from dealing with service providers and towards working with partners who add extraordinary value to your business without additional cost.
At times like these, it really is a must have.