Archive for the ‘Outsourcing’ Category

Embracing a shared services model will ultimately reduce the cost of delivering non-core services; however, it does place a higher degree of emphasis on both the applications to cater to the functional requirements, as well as the supporting and enabling technologies to meet the more complicated security models and privacy considerations along with operational considerations including availability, scalability and manageability.

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Strategy killers

The six silent killers of strategy:

• Top-down or laissez-faire senior management style;
• Unclear strategy and conflicting priorities;
• An ineffective senior management team;
• Poor vertical communication;
• Poor coordination across functions, businesses or borders; and
• Inadequate down-the-line leadership and development.

Actions for organizations intending to outsource :

1. Understand what you want, and why. Define what is needed, determining what is most important and what is least important. Determining why you want something often helps in better understanding what you need (Input, 2000);

2. Set measurable criteria. Ensure that the Service Level Agreement includes clear and measurable criteria and objectives so that both results and progress can be properly evaluated. Corbett (1998) describes a “scorecard” approach to objectively measure and capture the key determinants of success. The scorecard presents six to twelve measures;

3. Make sure there is a clear linkage to business goals. Contract formulations which encourage and reward achievement of the client’s business objectives provide the best foundation for success. Input (2000) states that client’s should make sure that plans and objectives for any outsourcing project have clear and realistic links to business goals;

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Seven outsourcing best practices

1. Objective performance criteria are negotiated, measured, and reviewed;
2. A formal relationship management structure exists;
3. Performance-based pricing;
4. Internal training and communications on business goals and relationship management;
5. Vendor training on customer’s business environment and goals;
6. Cultural normalisation; and
7. Ongoing exchange of knowledge and expertise.

Making offshore outsourcing work :

Wadhwani (1999) describes the key aspects of ensuring a successful offshore outsource as;

1. To bridge the distance, conduct daily online chat sessions about time-sensitive project and use videoconferencing whenever possible;

2. Before a project begins the client should, together with the in-country representative sign off detailed proposal and project definitions;

3. A consultant should be assigned and the use of strict project management tools and protocols should be enforced;

4. In country consultant should be familiar with local business practices;

5. Intangibles such as patience and persistence count too, as do incentives and rewards; and

6. Be sure the consultant is not underestimating timelines or over-promising.