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Require a smarter approach to outsourcing?

Buyer beware! What you need to consider when choosing an outsourcing partner.

The eternal debate continues: when it comes time for your next product or service, is it better to insource or to outsource?The answer to whether it is ‘core’ or ‘not core’ becomes a delicate balancing act of people, processes, tools, technology and profit. But, with the rise of smart, connected devices and services, coupled with devices moving towards the home and increasingly complex security requirements you’ve just added a degree of complexity to the situation that is unprecedented.


Looking to outsource? Make sure you have the right partner – leverage our checklist of questions to ask a potential vendor.


Outsourcing 2.0. What you need to know.

These fluctuations in today’s landscape require companies to assess the support of their complete product lifecycle: What is the appropriate business model for your requirements? How do we identify, assess and develop for new and different users and decision makers? To get the right information, what are the appropriate connected/IoT technologies and cloud services? How do we connect it together and tie it to our business management applications? These are just a few of the questions that are knocking at your door and keeping you up at night.

The reality of trying to have expertise in every stage of the product lifecycle will be almost impossible. As a result, outsourcing your product lifecycle requirements is a viable alternative to trying to bring all the expertise in-house. But with business, design and product development consulting groups, contract manufacturers and myriad of cloud and Internet of Things companies today, how do you know who can help? And how do you decide what stays in-house and what is outsourced?

In our opinion, there are a few key criteria and questions to ask to help you manage the decision process to build a successful partnership to get to the solution you will need to compete in the next generation of devices. The fact of the matter is that connected devices don’t just provide you with efficiencies but can dramatically increase value to your audience, differentiate you in the marketplace and improve your ROI. To compete you must first figure out how this is different and what you need to consider.

  1. Business innovation is mandatory, technical innovation is secondary.

Remember, this is intensely different than a traditional product. Simply adding new features to next generation products and connecting to the cloud is not enough. The industry requires new value propositions for your users as well as alternative business strategies for growth. You must transform your business to reach and develop customer relationships and gain insight for increased revenue opportunities. By exploring new ways of meeting present and future customer needs via smart product features and data, you will be able to fuel a sustainable competitive advantage and growth for your firm.

But how will your approach support a new audience and how might you evolve your business with a digital product strategy? To compete you must continue to improve your relationship with new users and decision makers but first you need to figure out how to go through the process of understanding your business opportunity. And while traditional product management expertise is important to have, there are experts and guides that can take you through the new process of determining your digital product strategy and connected product development process: See our digital product strategy article, “A Digital Product Strategy is a Must to Compete in the New Digital Economy”. Find experts that KNOW the difference and guide you in the right direction. We’ve provided key questions to ask vendors at the end of this document. If they don’t know these questions then move on.

  1. Systems integration of your criteria

First, build the criteria for what you want and need in a product lifecycle partner including quality, experience, culture, location and skill set considerations. And determine where in the product lifecycle, as you move from each stage within the process of roadmapping, development and portfolio management, you will need help. Examine what expertise you already have in-house and what expertise you need to supplement your team. Remember a smart, connected product has much different requirements: consider not only the connected device but the network, portals, multi-tenant segregation, API portals, data storage, analytics and presentation with the services required in device management, applications, system monitoring, financial and customer services. And integrating all these pieces at a systems level and under one quality management system, will create additional complexity to the desired outcome. Assessing exactly what you need upfront will help you narrow down your list of potential partners.

  1. Agile time management

From concept and definition to development, validation and commercialization through end of life, each step takes time. Managing multiple partners throughout the lifecycle that require transitions and ramp-ups can eat into your timeline. Weigh the benefit of multiple specialty firms against those with closed-loop support. Consider vendors that offer transparency and transition processes to ensure the product moves through the total product lifecycle without losing valuable time, quality or increasing cost. And remember, you will need to manage the vendors and the transitions.

The changing dynamics of your industry require more companies to evolve their approach to users, their business, as well as speed time to market with new technology. As a result, outsourcing will play an increasingly larger role to keep up with constant changes. As a product manager or someone with responsibility in the product lifecycle, you know very well the difficulty of getting a product to market. Now, with these added layers of complexity, you must incorporate these factors into your systems approach and make sure you understand what questions to ask in your decision making process. Adopting a plan for outsourcing includes thinking through your total product lifecycle and how you will keep up with the changing financial and globalization requirements to compete in the new digital world. Ask the hard questions or risk failure in today’s digital world.

How do you make sure you have the right partner? Leverage our checklist of questions to ask a potential vendor:

  1. Can you assist us in designing for optimized information value, applying digital design principles to our products, our business model, and our go-to-market strategy?
  2. Can you help us improve our odds of successful launch by expanding our design thinking to determine what types of information value our customers will want and will actually be able to use, given the state of their own operations in moving toward the Digital Age?
  3. Can you help us anticipate the difficulties our customers will face when they attempt to integrate and deploy the smart connected devices we bring to market?
  4. Can you assist us in applying digital design principles to identify innovative solutions for helping our customers deploy our digital products for optimum information value?
  5. What are the common barriers to successful digital product launches?
  6. Can you help us understand the full range of options available to us, for including digital functions in our products?
  7. How do we determine which digital functions are worth including, and which are not?
  8. Will your approach help us defend against fast followers and copycat counterfeiters?
  9. Do you have a systematic method for helping us keep our products fresh in the coming years, using digital design principles?
  10. What are the new challenges we will face, and what can we do to address these challenges while embracing new Digital Age opportunities?
  11. What new channels of value delivery are available to us when we take the plunge and go digital with our product lines?
  12. How does this impact our own business model, and the models used by our customers?
  13. Can you help us understand how digital products expand the business model beyond product-focused sales per se, tapping information value channels as sources of additional revenue, profit, and customers?
  14. Can you help us work through the details in designing and launching a digital product, from concept to prototype to monetization and go-to-market strategy?



Contact Logic PD and get started today.

We help deliver innovative solutions that conquer today’s complex and connected product challenges and optimize your market potential.