When is outsourcing NOT the answer?

When it’s a knee-jerk reaction to a current crisis, driven by dogma rather than analysis or when it takes insufficient account of reality.

Data from the outsourcing research specialist Everest Research Institute, suggests that nearly a quarter of outsourcing projects fail because clients have unclear expectations at the start of outsourcing contracts.

In my experience, the initial phases of any consideration of outsourcing as an option are the critical ones. There needs to be clarity over issues such as:

• The results the organisation is trying to achieve
• The drivers that have led to outsourcing being considered
• The scope of the services under consideration
• The status and maturity of the market for those services
• The alternative approaches that might yield better results (such as in-house transformation or shares services).

All of these need to be answered in order to arrive at a Sourcing Strategy (the option) underpinned by a business case (the justification for the change) and stakeholder engagement (the mandate for the chosen approach). Taking a little time at the early stages can avoid substantial costs later; in the words of the old maxim - measure twice, cut once.

We can help you make the right decision about how best to achieve your objectives (for example to save money and improve services). That may mean outsourcing – but the decision should be made objectively, based on the evidence.

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