Guess what? Not every job succeeds.
Some recent articles cite very low general satisfaction rates with contract relationships:
TransWorldNews cites in their article, Buyer Viewpoint on Information Technology Outsourcing that "45% of the respondents claim that their ITO projects are either unsuccessful or partially successful."
While nobody can ever completely avoid the chance of failure, there are plenty of things you can look for as 'early warning' signs. If you ignore these, chances are that you'll soon be throwing good money after bad. If you heed these warning signs when you see them, you can adapt quickly and increase your chances of successfully course-correcting.
Now, please don't let these issues scare you off from pursuing remote contractors to work on your jobs; these are intended to help reach successful outcomes. And fact is, these warning signs are relevant for in-house jobs as well as outsourced ones.
1 - Slowing response time - in my opinion, it should never take more than 1 business day to respond to email. If it suddenly starts taking longer, all is not well on the other end. Press the issue, find out why the responses are taking longer. Demand a faster response and make sure it's just a temporary blip.
2 - Hesitation to show work - a manager should always be able to see the work in progress. There's no such thing as "it's not ready for you to see yet". You're an understanding manager, ask to see the work in progress and make sure you like where it's going.
3 - Missed milestone - not the end of the world (I've heard some development projects aren't always delivered on time), but if a milestone is missed, make sure you understand why. Probe into the root cause of the missed deadline. Was it too aggressive? Were new issues or requirements discovered? Were the reasons valid? If one is missed, discuss the issue openly with your provider and come to an agreement about why it was missed.
4 - Dramatic increase in hours per day - If the number of hours worked per day increases unexpectedly, it could be a sign of trouble. Maybe it's crunch time and you don't realize how far behind the development is on the job.
5 - Rapid decrease in hours per day - Same goes for rapid unexpected decreases in hours worked. Is there another job or other commitments that your provider has? Inquire. Make sure you know why?
6 - Increases in offline time - Only applies to work done on oDesk: has your provider been logging all of the time online with detailed work memos. Is this changing suddenly? Do you see more requests for offline time or less detailed work memos. As a manager, you should dig in and find out why.
7 - Requests for additional resources - working with an IT firm? Have a team working for months and then unexpectedly get a request from the company to add additional resources or change team members or even the team lead? This is often a bad sign. If it's additional resources, it may be necessary to meet deadlines, but make sure you know why the initial plan isn't working. If it's a change in team members, this could lead to further delays as a result of a new ramp up time.
8 - Growing tensions - the worst possible flag. Are tensions increasing in your communication? Conversations shifting from chat to email to faxed correspondence? Tensions between manager and provider can flare up if a job is danger of failing. It's critical to keep an open line of communication and maintain mutual respect to work together through the issues. If tensions are increasing, course correct immediately.
So, how do you identify these potential problems? Stay active in managing your team. Don't be hands-off. Schedule a regular weekly or even daily meeting thru chat, phone, or web conference. Monitor work, progress, and productivity on a regular schedule. Set expectations from day 1 about how you and your providers will work together.
I have worked with hundreds of IT companies that are outsourcing some or all of their work. They don't hesitate to call me when things are turning sour. I often tell people to "trust their gut". If you have that funny feeling that things aren't going well, investigate and find out what's going on. If you're not happy, make the tough decisions quickly rather than waiting and waiting for things to get worse.