Outsourcing: A Recipe for Success

There is a body of Outsource Structural detailing that suggests that many outsourcing arrangements do not deliver the benefits expected by client organizations.

Common themes center on a mix of unexpected costs and relationship-related problems. However, despite these well-publicized challenges, there remains significant customer investment in outsourcing. In fact, the shift toward outsourcing more core or strategic elements of the business, coupled with the increasing importance of greater collaboration with subcontractors, is seen as a way to achieve greater flexibility and agility.

These challenges of Outsource Structural detailing and developments suggest that outsourcing continues to be widely viewed as important in realizing business goals and strategies, although there are many currently in existing outsourcing arrangements that are not delivering the expected benefits.

We believe that outsourcing can be an effective strategy, however, there are a number of aspects that must be understood and actively managed both from the outset and throughout the term of the contract to obtain the expected benefit for the clients' business.

The right combination of ingredients

Any memorable dining experience with indusdesignworks has behind it an exact mix of quality ingredients and other elements that include skills, experience, preparation, time, tools and monitoring to ensure the delivery of a successful result for the customer.

The goal of this article is not to describe a comprehensive process for outsourcing; after all, there are many articles on it. It seeks to explore, from the customer's perspective, those aspects of the "outsourcing recipe" that we know from experience are often overlooked or underestimated and yet we believe are critical in terms of delivering the required value over the life of the contract.

Examining these aspects in more detail will help those involved in recruiting and managing outsourcing better understand their existing outsourcing challenges and provide insight into how to improve the prospects for success of future outsourcing companies.

Having said that this is not an end-to-end guide to outsourcing, it is important, however, to provide some context. The outsourcing process can be divided into 3 key stages; Development of business cases, bidding and selection and management of the contract.

 

Creating the right conditions

It's important to ensure the right "conditions" are created at first, so it's worth recapping some basic principles of outsourcing.

Understand what your organization hopes to achieve through outsourcing and what services you plan to outsource:

Cost savings is one of the drivers of outsourcing, but many organizations also outsource to gain access to skills, drive innovation, and manage complexity / scalability more effectively.

Outsourcing is often more attractive and less complex for routine / repeatable activities or basic services.

This type of outsourcing requires a higher risk profile to be understood and managed and requires a more mature collaborative approach.

Make sure business requirements and how systems and capabilities can be leveraged are clearly understood as this is essential in defining the service, appropriate service levels, contract clauses, and ultimately the contract price. .