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Last year was indeed a turbulent year for Indian service providers. First the World Bank banned Satyam Computer Services from providing it software services for eight years alleging malpractices, including bribery, and and then, beginning this year, an avalanche of troubles fell on the beleaguered company, when the promoter Ramalingam Raju “confessed” to having siphoned off millions from the listed to two unlisted companies floated by his sons.
Earlier, three generic drug manufacturers, Ranbaxy, Sun Pharmaceuticals and Lupin got ticked off by the FDA, the apex drug regulatory authority in the US for alleged manufacturing deficiencies at their respective plants.
All this and more beg following questions:
Is there a pattern in these events?
Do norms tighten in a recession-hit market, when it’s hard for vendors to attract fresh business?
Could this be a tactic at re-negotiating contracts to drive down now unaffordable pricing?
Whatever be the implicit or the non-implicit cause of this malice, the more important issue to address here is, even if there is a pattern in these events, what can vendors and outsourcers do to prevent such skirmishes, when they are both battling hard to retain their market shares. Some of the possibilities include:
Take One Step at a Time
Not all vendors force clients into “all or nothing” engagements. Many indeed offer flexible engagement models that allow clients to start with one to two contractors. This is a smart thing to do even in established client-vendor relationships, especially during a time of flux.
Vendors at this point are eager to demonstrate that they have the means and resources to provide real benefits to their clients. They would readily agree to breaking big contracts into small manageable chunks that can easily be monitored for quality.
With New vendors Pilot Before Going Full Steam Ahead
It may be a good idea to initially kick off the partnership with a pilot project, something that gives you a clear, defined outline of the client expectations and deliverables see how it goes before launching into something bigger. It is always easier to set time and quality boundaries into smaller projects. Devise Scope Statements
Seems obvious? You will be amazed at how many offshore projects get kicked-off without a review and comment on the scope of the project.
Devising scope statements mainly involves:
Doing all this and more can easily save a lot of heartburn and hardship later.