Keep Track on Outsourced Services with This KPI Scorecard
Service outsourcing companies provide quality service to other businesses in the fields like technology, knowledge, logistics, security, etc. Effective evaluation of these companies would be crucial to improve their performance.
KPIs can prove to be a useful tool to strategically analyze the service outsourcing companies from different aspects.KPIs in this context can be categorized in 4 major perspectives-financial perspective, customer perspective, operations and education and growth perspective.
Financial perspective includes KPIs like percentage increase in operating costs, percentage increase in revenues, accounts receivables and percentage increase in employee-s remuneration.
This provides a financial overview of the operations of the service outsourcing company.Customer perspective helps in specifying the perception of the customers about the outsourcing company.
It can be judged through KPIs such as number of clients, privacy issues, number of outsourcing activities handled and integration capabilities.Operations perspective provides an overview of outsourcing operations and includes measures to judge the efficiency of different operations.
It consists of KPIs like average team size, percentage of projects completed in time, accuracy of operations and percentage of time allocated for Q.A.Education and growth perspective takes into consideration the initiatives taken by the company to improve the efficiency of its employees.
It comprises of KPIs like project related training programs, motivational programs, brainstorming sessions and number of group and team building activities.
Why do business professionals choose ready-to-use KPIs?
Read Why do business professionals choose ready-to-use KPIs? to find out the answers to these questions:
- Can a business professional research KPIs on his own?
- How do I avoid typical problems with KPIs?
- Is ready-to-use KPI applicable in my niche?
- Is KPIs' price affordable?
- Can KPIs can be easily integrated in any business environment?
- How can KPIs make the difference to the business?
What are the benefits of Service Outsourcing metric:
- Adoption of these metrics will make it possible to evaluate such kpis as increase in operational costs, increase in revenue etc.
- This is a part of the financial perspective in the Balanced Scorecards which is the most important one.
- Efficiency of outsourcing is measured with percentage of timely completed projects and tasks as well.
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More ideas on using Service Outsourcing KPI
Services being intangible in nature ask for an effortful approach to be adopted to understand the principles that govern their 'revenue generating power'. Consequently, the field of service outsourcing is a highly qualitative field that compels the outsourcers to go for a similar study of operations involved. Only after detailed studies have been into the field that one should opt for the organization to which work has to be outsourced.
Further, the issue encountered is about evaluation of the 'outsourced task'. One can achieve this by using BSC (Balanced Scorecard) for this aim. This strategy was formulated in1990s by Norton and Kaplan when the 'incapability' of financial metrics got surfaced. This made it compelling enough to bring 'non-financial indicators' into the scenario, 'outsourcing service' in the present case.
By using the useful metrics for this objective, one can tread the 'calculative path' of outsourcing services carefully and beneficially.
To figure out the set of relevant and useful indicators, it is needed that one studies in detail the basics operating in the concerned field and area; 'service off-shoring' in this case. This will make it possible to come up with related set of KPIs (Key Performance Indicators) and put them under related categories to analyze 'off-shoring of services'.
More useful information for Outsourcing Evaluation
Service Outsourcing Evaluation Balanced Scoreboard Screenshots
Metrics for Outsourcing Evaluation
This is the actual scorecard with Service Outsourcing Measures and performance indicators.
The performance indicators include: financial perspective, % increase in operating costs, accounts receivable, % increase in revenues, % increase in employee's remuneration, customer perspective, number of clients, privacy issues, number of outsourcing activities handled, integration capabilities, operations, average team size, % of projects completed in time, accuracy of operations, % of time allocated for q.a., education and growth perspective, project related training programs, motivational programs, brainstorming sessions, number of group and team building activities
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