How to Make Outsourcing Work
Shared goals and good management are key.
Computerworld - Everyone knows of a horror story related to outsourcing. As a result, many IT people seem to think of outsourcers as an axis of evil that should be eliminated or at least squeezed for every penny. But outsourcing, like any business relationship, is more nuanced than that.
Companies engaging in outsourcing relationships frequently make mistakes. They document processes poorly, ignore training, rush to implementation or focus only on savings. These errors result in a your mess for less approach in which the outsourcer moves your people, process and systems in whole or in part across to its company while figuring out a way to cut staff and provide the same service.
But theres a better way.
The first thing to understand is that an outsourcer, just like your company, is in business to make money. Therefore, its priority is the same as yours. This isnt a bad thing; on the contrary, its good. A profitable outsourcer is a healthy partner, and as a customer, you want a solid company to work with. Second, outsourcing can work out well or badly, depending on how well you manage it.

Sean Barker
1 Maintain your control. Dont make the mistake of ceding complete control of your infrastructure, applications or both to an outsourcer. Companies that do this mistakenly assume that the outsourcer knows more than they do and therefore should be able to serve all of their needs better, faster and cheaper. Instead, keep or hire key people in each area to maintain control and guide and govern the outsourcer.
2 Measure, measure, measure. Implement metrics that are important to your business, such as performance level, number of incidents, development cycle times or speed to market. Assign staffers who understand the metrics to collect and benchmark them and then combine them to create context. Take, for example, number of incidents: The raw data doesnt tell you how those incidents affected production or whether a project was slowed because people who were needed to code an application were redirected to solve problems resulting from the incident.
3 Marry the partner. An outsourcing relationship requires give and take. Even the best contracts include gray areas that can be interpreted in various ways. The deal must work for both companies, so mutual benefit is the goal. For example, look for ways to increase the outsourcers revenue within its core competencies. If you can reasonably redirect dollars youre already spending toward the outsourcer, youll likely get a better deal while helping to grow its business a win for both sides.



- Excel 2010 Cheat Sheet
- Register for this Computerworld Insider Cheat Sheet and gain access to hundreds of premium content articles, guides, product reviews and more.
- Overcome Top 7 Admin Challenges of Active Directory
- As Active Directory's role in the enterprise has drastically increased, so has the need to secure the data. Gain insight on creating repeatable,...
- Insiders Can Ruin Your Company. Take Action.
- Did you know that 80 percent of threats to an organization come from the inside? The threat from insiders is often overlooked in...
- Smarter Commerce is redefining value chain visibility
- Smarter Commerce is redefining the value chain in the age of the customer. It starts with putting the customer at the center of...
- Identity Governance: The Business Imperatives
- This white paper describes the business challenges and opportunities that are driving interest in Identity Governance while discussing considerations your organization should make...
- The Executive Buyer's Guide to Project Portfolio Management
- The Innotas Executive Buyer's Guide provides you with a concise overview of Project Portfolio Management (PPM) and delivers important buying criteria to help... All Management and Careers White Papers
- Live Webcast
Integrated IT Operations Management in the Cloud - Join award-winning technology editor Stan Gibson and Andrew White, CMO at Numara Software, to learn how asset management and service management are converging...
- Integrated IT Operations Management in the Cloud
- Join award-winning technology editor Stan Gibson and Andrew White, CMO at Numara Software, to learn how asset management and service management are converging...
- Optimizing Networks for the Cloud
- Join guest speaker, Rohit Mehra, IDC Director of Enterprise Communications Infrastructure, to explore current trends, discuss best practices for optimizing Data Center and...
- Apps QuickStart Series Part 2: Designing and Deploying SQL Server on VMware vSphere
- Download this webcast to learn about the design considerations for virtualizing SQL workloads, performance and scalability information and high-availability options, as well as...
- Apps QuickStart Series Part 1: Designing and Deploying Exchange 2010 on VMware vSphere
- Download this webcast to learn the virtual hardware design considerations for Exchange 2010, deployment using the building block approach, options for high-availability and...
- Customer Spotlight: How IPC The Hospitalist Company Implemented Oracle on VMware
- Have you been looking to hear about customer's experiences with the new VMware vCenter Site Recovery Manager product? View this webcast to learn... All Management and Careers Webcasts