The secrets bundle of success in outsourcing
Outsourcing is no small task; planning, communication and follow-up are essential in any outsourcing endeavor. Companies that have effectively implemented outsourcing in their organizations point out different reasons for their success:
1. Planning and Preparation: set realistic objectives and expectations for the process and the transition.
2. Effective Change Management: includes obtaining stakeholder buy-in, communicating early and often and planning for the work that will stay and for the people whose work will go away.
3. Manage the Relationship: design and execute a robust governance structure, promote teamwork and evaluate progress by measuring the right things
4. Contract Negotiations: be thorough in understanding and documenting requirements
5. Vendor Selection: select the appropriate provider
The Motivations to outsource are varied because the companies pursuing the solution and most organizations who decide to outsource are doing so with the objective to achieve a combination of many associated benefits. Some of the main driving factors prompting organizations to outsource include cost savings, a focus on core competencies, access to leading–edge technological advances, access to specialized expertise, improvement in the delivery and quality of services, and/or a solution to resolving organizational politics.
The decision to outsource a function should start with a sound business plan and successful outsourcing process starts with a good contract. In order to achieve success, the business relationship between the client and the vendor should be clear to all parties prior to the completion of the agreement. Addressing the key change management issues for employees impacted by the decision is necessary to achieve long term outsourcing success.
It is clear that the role of outsourcing should not only include cost saving objectives but should look to address other benefits such as improved service, focus on core competencies, access to leading-edge technology and specialized expertise.
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