4 Common Real Estate Outsourcing Problems: How to Avoid them

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Make no mistake, outsourcing can go bad, and go horribly bad. Indeed, one of the biggest reasons realtors don’t use outsourcing is they are worried about what can go wrong. They want to keep control.

But you can keep control and enjoy the benefits from outsourcing, while avoiding having it ruin your business. In this blog post we cover some common pitfalls, how they could impact your business, and how to avoid them.

Source: www.deloitte.com

 

Problem 1: Loss of control

Whenever you hire an outsourcing provider, you’re giving up control. You’re not going to be there to give instructions in person. You might even only have a scheduled phone call once a week, and everything that happens outside then is out of your hands.

Worse, if your outsourcing provider makes a mistake, it can take time for you to be notified, and even more time to fix. What would only be a day-long hiccup in your office, could turn into a two-week saga.

The problems caused by loss of control can be solved in two ways:

First, and most obviously, make sure the outsourcing provider is able to do what you ask. At first, only agree to hire them for a month or two, conditionally. If they perform the work flawlessly, hire them again for bigger projects. But start small. Ask them to prove themselves before you have to rely on them.

Second, manage the outsourcing relationship directly. Don’t just leave it to a weekly phone call. Instead, tools like Basecamp can help you have direct contact with the outsourcing provider at all times.

 

Problem 2: Inflexibility

Another way to help solve the control problem is to define exactly what you want done at the start. You have the most control at the contract signing stage.

This creates a second problem: You won’t be able to change the scope of work very quickly. If you negotiate with them for a certain skillset, and the needs change due to changing business or market, do you try to change the scope, or keep going?

The best way to solve this problem is not to encounter it at all. Don’t hire outsourcers for tasks that may change the scope quickly. Instead, hire them for the mundane, rote tasks that always need to be done so you can focus on being flexible. See our previous blog post, Outsourcing for Realtors, for details on which tasks are best suited for outsourcing.

For realtors, the key tasks which require the most flexibility are those which respond directly to client interaction: Sales, inspections, even client phone calls. To save time on these, automation tools are best, not outsourcing. See our white paper, Trigger Mailings, Autotexts and Voicemail Drops, for more information on these alternatives.

 

Problem 3: Quality issues

With outsourcing, you’ll potentially have quality issues. There are a lot of bad outsourcing providers out there, but even if you’ve chosen the provider carefully, mistakes happen. Maybe someone gets sick, and then work gets rushed to catch up. Maybe there’s a miscommunication, and what gets produced isn’t quite what you asked for.

All these things can reduce quality, but you can guard against them.

Aside from choosing the outsourcing provider carefully, set milestones and deliverables, not just final due dates. If you need work done by a certain date, ask to see progress on the task two weeks in advance.

At the same time, make sure you are proactive. Don’t just leave it to the outsourcing company to contact you about issues, but actively engage with them and manage the relationship. This can cost you more time, but will also give you time to fix any problems before they balloon into crises.

Source: www.raconteur.com

Problem 4: Loss of intellectual capital

Doing work in-house will develop the collective skills of the people in your firm – what some like to term “intellectual capital.”  What’s more, you build up a bank of templates, precedents, and guidelines that can be used to build on and improve.

With outsourcing, though, you start from scratch every time. If you stop hiring a provider, all their work goes with them. This is another reason why you shouldn’t outsource a core area like sales where professional skill development is important.

However, this can be a problem even when doing rote work. If you come to rely on your database being managed a certain way, or emails written a certain way, switching providers can result in an uncomfortable adjustment period.

The best way to avoid this is to create templates and style guides. You can even have the outsider work on these guidelines for you.  Not only does this allow you to get future outsourcing providers up to speed quickly, but also gives you more control over how your current outsourcer will perform the work you’ve asked of them. By signing off on how they’re to write emails, you’re more likely to receive emails you actually like.

Despite the problems, don’t be scared by outsourcing. With only so many hours in the day, and employees an expensive investment, outsourcing can prove extremely profitable. However, by taking some common sense safeguards, you will stop it from causing headaches.