Legal Outsourcing Contract and Common Mistakes
These are the following common mistakes made by the companies while entering into outsourcing arrangements and generally result into failures of the outsourcing arrangements.
- Putting service providers in a box with every change then being out of scope
- Having to make trade-offs between innovation or improved service, and reducing the buyer’s cost or improving the provider’s profits
- Weighing the angles for each party’s self-interests• Having a contract that ends up being used as a legal weapon or a protective device
- Compromising in pricing negotiation such that both parties settle for something less than they hoped for
- Getting stuck with a statement of work that’s too tightly defined and not flexible for unanticipated challenges
- Playing the shell game as the provider shifts costs around in an effort to maintain its target margins
- Ending up with the service provider that is unwilling to take on risk by making large investments to generate larger returns for both parties
- Taking the financially short-sighted approach of shifting risk to the other party and thus adding to the hidden costs