Risks Outsourcing and Mitigation Strategies

Amy Pattinson
August 17, 2022
 Mins Read

Outsourcing is the common practice of assigning corporate processes and functions to third-party providers. The advantages of Business Process Outsourcing are numerous, ranging from efficiency to cost savings, from providing a competitive advantage to making strategic decisions to making the entire firm more efficient. Both startups and well-established companies can benefit from outsourcing. However, a key change in the business process and entrusting the organization's information to a third party pose a potential business risk. We cannot neglect and underestimate the risk. Invensis is a reputed leader in empowering numerous global businesses and organizations through high-quality back office BPO services that promote enhanced business efficiency and improved bottom line. If you contemplate outsourcing your business processes, this article will provide a comprehensive guide on risks outsourcing & mitigation strategies.

What is Risks Outsourcing & Mitigation Strategies?

Outsourcing projects are not easy to manage, and many projects fail even though much research exists within the area. However, with solid preparation and planning, many risks of outsourcing software development can be mitigated. Still, nothing helps more than understanding the potential pitfalls and how they might be avoided. We've compiled a list of the most common worries people have about outsourcing IT and outlined how to manage its dangers. Hopefully, these suggestions will help you overcome your reservations.

Let us understand the several Risks Outsourcing & Mitigation Strategies types and their solutions

Risk 1: The Long-Run Problem of Having Trust

If you're debating whether or not outsourcing company procedures is a good idea, the question of how you can trust someone thousands of miles away is likely on your mind. The degree of this trust is determined by how many points an outsourcing business may earn through risk analysis and whether or not these risks can be mitigated. Verifying these with an outsourcing company you'd like to work with in the future will help you make near-perfect predictions about the success of your project.

Solution: Pick the outsourcing company depending on the following:

  • The number of their clients and success rate
  • The company website: Whether it's attractive or not
  • The maturity of their company
  • Their social media activities

Risk 2: Domain Expertise

Because outsourcing organizations are always dependent on the availability of highly competent expert individuals, they sometimes protect themselves by dividing their workforce into different parts. This can ensure that local/outsourced employees do not have access to sensitive knowledge about your firm or its technology, as this would be a security risk.

Solution: Determine the technologies where the proficiency of the selected vendor lies in. Please take a look at their implemented projects while knowing their accomplishments.

Risk 3: No Expertise With Remote Teams

Clients often say they are not ready to outsource or hire remote teams or need to have all staff based locally. This is most likely to occur if its founders have no prior experience outsourcing and managing remote IT operations. If you hire an inexperienced service provider, the scenario could become disastrous. Furthermore, you don't want vendors working with you to be their first time working remotely.

Solution: Look for a company with a well-established model for integrating remote teams. This approach demonstrates that a provider has the necessary experience and skills to collaborate successfully. Furthermore, you will be guided on all elements of remote work by your prospective partner.

Risk 4: Knowledge Transfer

Knowledge transfer is the most important aspect impacting the success of an IT outsourcing relationship. There are two types of information transfer in the most basic form of outsourcing. The first is from the corporation requesting that the outsourcer produce something. The second is that the consumer does not "own" the "know-how" and fluency in the generated product. Although the code is "owned," the know-how and experience are not. As a result, a successful outsourcing project is a two-way street requiring a continuous flow of information.


  • When it comes to technology, seek outsourcers who have progressed past manual data entry and now use cutting-edge software to capture business operations
  • It's also crucial to choose outsourcers who are constantly on the lookout for new knowledge transfer methods
  • Finally, as part of the knowledge transfer process, search for an outsourcer who can establish an innovation roadmap

Let us understand the last type & solution for Risks Outsourcing & Mitigation Strategies.

Risk 5: Confidentiality and Intellectual property

You entrust part of your IT infrastructure to another company when you outsource. As a result, you're giving the outsourcer sensitive information, including processes, employee information, and other vital data. As a result, it's understandable if you're concerned about the outsourcing provider handling your resources' security.

Solution: Choosing an IT firm that adheres to international security standards might alleviate your security concerns. Try using (CAN) to discover a dependable outsourcing company:

  • Check to see if the company is willing to sign an NDA (Non-Disclosure Agreement)
  • Inquire about the company's previous expertise with sensitive data

If you want to know more about risk outsourcing you can have a look at our previous blog "8 Key Steps to Minimize the Risk of Outsourcing".


Fortunately, the above outsourcing risks can be easily averted when thoroughly planned team selection and development outsourcing. Although preparations can be time-consuming, the result should satisfy your expectations, especially when delegating work to agile teams. With the proper plan in place, you'll be able to address even the most serious software development risks, ensuring that your customer-vendor interactions are fruitful and your outsourcing experience is profitable. Invensis’ deep industry-specific expertise helps us to tailor customized back office BPO services that match your business needs. Also, we provide services including IT Services, Call Center Services, e-Commerce Support Services, Finance & Accounting, and many more to reach your organization's peak.

About Invensis

Invensis Technologies is a leading global provider of IT-BPO services with a reputation for excellence. Our carrier-grade infrastructure and commitment to empowering clients around the world to achieve business transformation and growth through our services sets us apart from the competition. With over 5,000 staff and more than 22 years of experience, our company has been providing quality services since 2000 from our Wilmington, DE office, with delivery centers in India.

Invensis delivers intelligent contact center and back-office functions for businesses. Invensis is an ISO 9001 and 27001 certified organization and has achieved HIPAA compliance to provide high-quality and secured end-to-end outsourcing services. We have a strong base in the USA, Canada, Australia, UK, Ireland, Germany, and other countries serving over 200 clients. Invensis provides innovative processes and technology solutions. It also provides holistic automation from design to implementation and continuous development—along with data security. To tailor to help achieve your business's strategic goals, our solutions will help you. In addition, help them become industry leaders.

Article by
Amy Pattinson

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