Top Ten Reasons for Offshore Outsourcing Project Failures

Most companies don't want to advertise the problems they've encountered. However, most offshore outsourcing projects fail due to ten reasons:

1. Companies have unrealistic expectations on possible cost reductions.
   
   
2. Management outsources activities that should not be outsourced.
   
   
3. The wrong vendor is selected.
   
   
4. The contract is poorly written and interpreted.
   
   
5. Companies use outsourcing in an attempt to get quick fixes on deeper process and management problems.
   
   
6. Businesses lose control over the outsourced activity.
   
   
7. Managers overlook the hidden costs of outsourcing, such as extra coordination.
   
   
8. Companies do not plan an exit strategy (i.e., firing an incompetent vendor or insourcing of an outsourced activity).
   
   
9. Corporations overlook critical personnel hiring, training, and retention issues.
   
   
10. Management fails to measure actual service levels and ensure that they are aligned with the business's objectives.