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Three Important Steps before Outsourcing of IT Service & Work

 > Business Laws  > Three Important Steps before Outsourcing of IT Service & Work

Three Important Steps before Outsourcing of IT Service & Work

A lot of IT related work is outsourced from the developed countries like US, UK, Australia etc to different developing countries and India ranks first in this. This entire outsourcing of IT work is done primarily for the two reasons i.e. easy availability of the skilled workforce in the developing countries and secondly due to the cost effectiveness. However, outsourcing of work sometimes creates more perils than benefits and thus both the parties i.e. the Service Provider and the Service Recipient should follow certain steps in order to enable smooth functioning of the entire process and reducing chances of friction.

Thus, there important steps before Outsourcing of IT Services & Work are
Step No. 1: Exchange of Proposals & Allied Documents

The first and the foremost step is to exchange a proper Proposals which shall carry in detail the exact scope of work and the commercials involved thereto. This shall be duly accompanied with supporting documents including proper references who can vouch for the particular Agency or Corporation. This stage is the first stage and thus has to be fulfilled with utmost diligence.

Step No. 2: Executing an Outsourcing Agreement
The second step is to execute a legally binding and legally enforceable agreement i.e. the Outsourcing Agreement which shall be duly executed between both the Service Provider and the Service Recipient respectively. This Outsourcing Agreement shall carry in detail all the clauses which shall be decided by both the parties and shall govern the entire business and transaction between the parties. The same shall carry clauses with respect to Jurisdiction, Arbitration, Indemnity, Termination etc and both the parties shall be bound by the same. This Outsourcing Agreement shall give a defined legit structure to the entire transaction.

Step No. 3: Executing a Non-Disclosure Agreement (NDA)
The third and final step is to execute a Non-Disclosure Agreement 9NDA) between both the Service Provider and the Service Recipient. This is a legally binding document and shall act as a shield to protect the Data, Processes and the Intellectual Properties respectively.

All the above mentioned steps are inevitable and needs to be necessarily accomplished before commencing the outsourcing of work as well as before accepting the outsourced work respectively. These steps are duly recognised as per the legal system and as per the industry standards and all the documents mentioned hereinabove are legally binding upon the parties executing the same and are legally enforceable documents before the Court of law.
Authored By: Adv. Anant Sharma

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