Small businesses can rarely afford the luxury of a large full time staff, with all the skill sets needed for the functioning of the business. Come to think of it, even if they could, many business owners would not want the burden of managing a large headcount. That is why outsourcing is such a workable option for so many.

No doubt you've outsourced some work before – it is inconceivable that a business can be entirely self sufficient. However, if you've not had a great experience in the past, or are considering outsourcing in a big way in the future, these tips might be of value:

Check them out – an outsourcing vendor is no less critical to your operations than a regular employee, so why should you one with less caution? It is worthwhile to shortlist two or three service providers, on whom you can do a complete background and credentials check before zeroing in on “the one”. It is useful to ask for:

• Examples of previous work

• Client testimonials and references

• A sample as per your specs – if need be, pay for it

Lay down the ground rules – a lot of outsourcing relationships fail because of a lack of clear delineation of responsibilities. Remember that you have relatively less control over an outside service provider, as compared to your own employee. Therefore, before outsourcing any work, be clear about your expectations from the vendor in terms of:

• The nature and scope of the service

• The price to be paid

• The time it will be delivered by

Some more words of wisdom

• Be sure to lay down technical and other specifications as required, as well as performance benchmarks.

• As far as possible, link payment to deliverables. (And never pay too much upfront.)

• Most important – keep everything in writing!

Go slow – the temptation to offload everything the minute you sign up could be your undoing. Besides, it may not be very fair to expect top notch performance right away. Start by outsourcing some part of a project, preferably that which has a lower impact on your business. See how it goes before you take it further.

Don't decide purely on price – a vendor may be cheaper for a very specific reason. You need to find what that is, before hiring the one quoting the least number of dollars. Often, there may be hidden costs that surface much later and inflate your expenses.

The best thing is to ask for a quotation in a standard format, so that you know all bids are comparable. Finally, don't base your decision purely on price.

Keep talking with each other - Establish a review and feedback mechanism that can help everyone understand which way things are headed. Of course, this means that everyone must know what is expected of them.

An outsourcing relationship can succeed only when all parties play their respective parts well. And that includes you too.