Does your product outsourcing partner meet your Fit and Trust criteria? Part 3

Does your product outsourcing partner meet your Fit and Trust criteria? Part 3

Continuing the series ‘Choosing The Right Outsourced Product Development Partnerwe bring you the 3rd part of the series –

Does your product outsourcing partner meet your Fit and Trust criteria? 

Outsourced

Fit:

You want a partner who fills the gaps in your business, fulfils your outsourcing objective and easily becomes part of your business philosophies. Determining if the partner will fit can be tricky, because fit cannot be determined only by evaluating your partner. For determining good fit you need to introspect and evaluate yourself, evaluate the partner, and understand the market. To exemplify this point let’s consider a case on evaluating a partner on one critical point – the process used for developing a product.

What will be the best production process for collaborating on developing a product with an outsourced product development partner? Do you wish to go by planned, stringent way of developing a product or you wish to go agile? In a planned methodology of product development the process order of requirement, design, implementation, verification and maintenance is followed in very stringent manner. While agile methodologies embrace iterations. Small teams work together with stakeholders to define quick prototypes, proof of concepts, or other visual means to describe the problem to be solved[i].

1st step here is to determine your own requirement and then to evaluate the partners on the basis of how well prepared they are to implement projects on Agile or Planned methodologies depending on your requirements. For determining requirements consider,

  1. Markets (i.e if you are dealing with stable or highly erratic markets)
  2. Your own clarity on product (i.e you exactly know what product you want vis-à-vis you have a business problem and partner should help you come up with product specification to solve that particular business problem)

Following table provides framework to suggest what will work best in which situation.

 

Market ConditionsStable                                                                                       Erratic
                                       WellSpecified 

 

 

 

Product

 

 

Loosely

Specified

(i.e business problem statement provided)

 

Planned(A) Agile(B)
Agile(C) Extremely Agile(D)

 

  • Situation (A): If product is well defined and markets are stable go for    planned methodology and exercise governance over partners. However, this situation rarely exists in real life business scenarios
  • Situation (B): Even if products are well defined by you but market is highly erratic, Agile makes sense. As market demands adaptability.
  • Situation (C): When product is loosely defined but markets are stable, Agile will make sense. At any point in the product development life cycle, you may get an idea for improving the product, which needs to be incorporated.
  • Situation (D) : When product is loosely defined and market is highly erratic, you need extreme flexibility. So you need to go with partner which incorporates the best agile practices in developing the product.

Once this is done you know what works best for you. If I am a company which is facing situation D, I know that I need to see if my partner will provide the efficient product development through agile practices.

Besides process (agile or planned), fit needs to be evaluated on various aspects like,

  1. If the partner is filling gap in terms of capabilities? What kind of innovations they are capable of making? Will you benefit from the same?
  2.  They should have better know-how and resources in the domains in which you lack expertise.
  3. Are they good problem solvers with specific business problem that you are outsourcing to them? They should be able to act as your consultant and be proactive with solving the business problem.
  4. Do they have same level of passion that you have for a particular project? As a company you have a better clarity of the overall outcome the project. Most of the partners will see the work as a onetime assignment. Few will understand the end-to-end processes and repercussion of the project’s performance.
  5. Does your outsourcing partner understand the positioning of your brand? Your outsourced partner plays as critical role as employees when it comes to delivering the brand promise to the market.
  6. Do they understand the new product impact on the internal aspects of your organization? They should not only be able to develop a product but should also be able to guide you on training your people and adjusting your processes as per the changes that the particular product development project will bring to the organization once it is complete and running.

These are some of the major aspects where you will evaluate the partner’s fit with your business goals. Use a framework to evaluate yourself and market on these various critical aspects and then match the capabilities of the partners to determine the fit.

Trust:

Trust is built overtime. It is difficult to have trust and faith in new partner right away. But trust is critical in this business relationship, as you share critical internal information with your partner. You want to make sure that your business processes, internal knowledge, resources, etc. are safe with this partner. You also want to have trust in them, from the very initial level, on their capability to deliver the project at par with or beyond your expectations.

How can you trust someone with whom you are working with for the very first time? Let’s look a few parameters that will help you decide a right partner.

1. Past projects:

Look into the past projects that the firm you are planning to partner with has delivered. If possible, talk to the organizations with which the firm in question has partnered with on an outsourcing project in the past. Also, look at the market performance of the past projects. This will provide you insights on people, work style, commitment, quality, etc.

2. Product Development Experience:

Most companies in IT outsourcing services space do not possess the end-to-end knowledge and expertise of developing and deploying a product. A product requires high-end design, coding, testing and UI skills. Look for a partner who specializes in building end-to-end products and not plain vanilla IT outsourcing companies. Further, if the partner understands steps that need to be taken to launch a product, it’s a great benefit.

3. People:

If possible meet all the people who will be involved on the project before making the final decision. Not only the decision makers but also the team involved on project is important element of your decision. Make sure that they understand the new product impact on the internal aspects of your organization.

Meeting with people also gives you a fair idea of how passionate your partner is for the project. Passion to deliver and excel can be the best clue for you to have trust in your partner.

If possible, interview developers and employees who will work on your product.

4. Strong communication flow:

How good is the organization with its internal and external communications? They should be efficient with sharing and discussing all the information and know-how, freely and systematically, within and between the organizations.

In the next and final part, you will read a case study of a product built by GoodWorkLabs for ST Dupont.

You can access the complete series here –

Series: Choosing The Right Outsourced Product Development Partner – Part 1

Strategic Advantage of the Outsourcing Partner – Part 2