Most companies still have investments in internal document print and mail
facilities but the tide is rapidly changing. Why is document outsourcing growing so rapidly?
The most obvious reason companies consider document and statement outsourcing is to reduce capital investment and on-going expenses for laser printers, mail machines, software, and personnel -- all of which are utilized on a part-time basis. Strong outsourcing
partners offer state-of-the-art production facilities allowing
you to pay only for your company's usage.
Concentrate on Core Competencies:
In a very competitive world, successful companies have become
more focused and specialized than ever before. Sales and revenue
growth are imperative - building fixed overhead is not. Today, many organizations recognize there is no competitive advantage in building and managing print and mail operations, especially when print and mail will diminish over time with the future transition to electronic documents.
Lack of Internal Expertise:
Few companies can afford to hire a full time staff to research
and stay abreast of technology changes in laser printing,
mail production software and equipment and postal regulations.
Evaluating, purchasing and implementing electronic document
technology raise the bar significantly. Thriving document statement and invoice outsourcing companies have that specialized expertise -- that's why they are successful. Continued technology advances, increasing
wages for the best people and decreasing talent pool insure
outsourcing will grow dramatically.
If the primary goal of outsourcing is to reduce costs then why do most companies fail to accurately assess their internal costs? Certainly capital equipment investments in printers,
mail machines, servers, supplies, maintenance contracts and
operator salaries are easy numbers to obtain - in fact, most
studies stop right there. What's wrong with this comparison?
The outsourcing company, if properly managed, has the same
hidden "soft" costs of running any production operation. Therefore, an accurate comparison to a quotation for outsourcing check printing or statement production, for example, should include true in-house costs, not just hard dollar line items in budgets. An example of soft costs rarely addressed is indirect
labor cost, such as accounting, budgeting, interviewing, training,
recruiting, payroll, benefits administration, mailroom management,
temporary labor, IT support, building facilities management,
vendor contract management, shipping and receiving, purchasing,
and mail delivery. What about hidden expenses that are buried
in larger line items - warehouse storage space, delivery vehicle
usage for mail delivery, various types of insurance, real
estate and utility costs, and so on. All of these costs are
included in outsource pricing. If the objective is a true,
accurate comparison of in-house versus outsourcing, then be
prepared to spend some time analyzing real internal costs.
What selection criteria should you use when all your outsourcing
candidates appear equally qualified to perform your work and
the pricing is close? How many times have you heard "they
are all about the same so I went with my gut feeling"? Basically
that means the vendors did a poor job of educating the customer
or the customer didn't put enough effort into understanding
the differences in the vendors. Either way, the decision becomes
a gamble on future satisfaction.
There should be two major considerations in selecting a
document outsourcing company. First, the usual outsourcing price quotation
is based on what your company is doing currently. A great
outsourcing company will ask questions, understanding if you
have requirements that are not being met and what you would
like to improve. A great outsourcing company will produce
two quotes - one that compares apples to apples and one with
recommendations for improvements and related costs, demonstrating
how to reduce production costs.
Secondly, understand the values of the outsourcing company
by listening to how they represent their company. Is the sales
presentation based on the number of laser printers and mail
machines or do they focus more on satisfied customers, quality,
and solving your business problems. Is the outsourcing company
flexible, willing to make changes as the customers' needs
change or do you get the feeling you have to conform to them.
Do their customers really speak highly about the relationship
and provide strong recommendations? Has the outsourcing company
honored all commitments on service and turnaround with their
customers or does support drop after contracts are signed?
The extra investment in looking beyond pricing and capabilities
will pay off handsomely insuring a mutually successful outsourcing
relationship. Rest assured, all outsourcing companies are
not created equal.
lanvera.com - Outsourcing
P: 972.488.6400 | Dallas, Texas | email@example.com