printed in the April 1999 issue of Bio/Pharmaceutical
A new benchmarking tool promises to help outsourced service
providers establish milestones for their company’s performance
– and let them know where they stand against others in the
outsourcing industry. The upside for their clients; unprecedented
and improving service from their outsourcing relationships.
Developed by Michael Corbett, president of NY based
Michael Corbett & Associates, The Global Outsourcing Report
serves as a cross industry benchmarking tool on performance management.
“We’re really focusing on the way relationships between
firms are managed and conducted,” said Corbett. “Because
of that, the questions are independent of the industry involved.
The report includes results of client interviews on
10 categories of performance management and feedback on how the
provider’s performance compares with others in the outsourcing
industry. Proprietary information is shared with each organization,
and a compilation of results, stripped of identifying names and
information, is distributed to all participants.
Conducted as a pilot program last year, the report already is paying
dividends. Haas Corporation, a PA-based chemical management organization,
used the results of the survey to dramatically reshape the way it
does business with its clients. Here’s what happened at Haas:
Prior to participating in the report, Haas conducted
several internal surveys of customer satisfaction. But President
Thad Fortin felt that an outside organization would be more successful
in persuading clients to share the unvarnished truth about what
they really thought of Hass’ performance. “Besides,
we’re a chemical management company, not a quality survey
company,” he adds.
The report showed that Haas must have been doing something
right: 100 percent of its clients expressed overall satisfaction
with the services they were receiving. Clients were particularly
pleased with the accessibility of top management. Since Haas has
six via presidents, each with account responsibility, clients rarely
need to wade through red tape to get answers.
But, Haas found out, there was definitely room for
improvement. Like other organizations who participated in the report,
Haas found that its lowest scores were in the area of communications
and innovation. Lack of consistency in communications was a common
theme, according to Corbett. For example, different members on the
outsourcing team might be providing the client with different information,
or be communication effectively to different degrees. Has’
experience backed up these findings.
“We’re growing rather quickly, and we’re
still in the entrepreneurial role,” explains Fortin. “Communication
is one thing that slips through the cracks.”
As for the lower scores in innovation, Fortin sees
this as part of the communication issue. “For us, the score
in innovation may be a perception. We may not have been documenting
what we do well enough,” he says.
Fortin wasn’t surprised by the results of the report. Some
of the findings already had been confirmed by the organizations
internal studies. “What we thought we were doing well, the
report showed we were,” he says. But having clients’
honest feedback in “black and white” became a powerful
tool for change, Fortin says. So, after receiving the report, Haas
Fortin’s first step was to share the report
with company executives to discuss ways in which the organization
could improve. The report then was disseminated among the rest of
the reporting structure. And the company prepared a summary of results
to share with customers.
Haas then moved to standardize communication procedures.
The report found that communication was erratic, with some clients
receiving regular reports and others left out of the loop. Now,
all clients receive regular communications via reports and meetings.
Haas also expanded its definition of “client.”
Haas often is hired by a firm’s headquarters to perform work
for a plant located halfway around the globe. Haas used to send
reports to either headquarters or the plant, but not both. Now,
Haas makes sure both entities receive the same information.
Based on the study, the company also revamped the
technology used to generate reports for clients. Haas shaved several
months off the new software product’s development time, sending
a clear message to customers that the company “got it”:
Finally, Haas now publishes a quarterly newsletter
that tells clients what’s happening in chemical management,
and how it affects them. It also informs clients about the latest
goings-on at Haas.
For Haas, The Global Outsourcing Quality Report provided invaluable
feedback on how to better satisfy customers. “So much of our
business is not product-related, but service-related,” Fortin
says. Satisfying a customer’s service needs no only differentiates
Haas from the competition, it improves its bottom line, according
to Fortin. “We spend a lot of money trying to get a customer,
and a three year contract (the typical length for a Haas client)
just isn’t a big enough payback,” says Fortin. So Haas
wants to make sure customers are so satisfied that they won’t
even look at another provider when their three-year contract is
up. “Anything we can do to keep customers happy is a more
economical investment than attracting new ones,” Fortin says.