Outsourcing Insights

The future is not what it used to be... & Outsourcing is, increasingly being used as a tool for gaining a competitive edge. Understanding of where, when and how to successfully outsource, is proving to be one of the most difficult and important business skills needed for your company's future.

Outsourcing today covers a range from HR, real estate management, inventory control and most commonly, the information systems (MIS) and related communications network management.

You MAY be an outsourcing candidate IF you are asking yourself:

· Are my resources being utilized effectively?
· Do the department's objectives support the corporate direction?
· Can my IT department enhance our corporate financial goals?
· Are the current resources capable of supporting new technology?
· Is there a quicker, more effective method to handle these issues?
· Should we consider an offshore solution?
· Are 40% savings for real; what are the after-shock effects?
· Will employees have a basis for litigation? What are their options?
· If I make the wrong decision, what are the consequences?

Outsourcing used to be a tactic to improve operations and financial performance of troubled organizations. Today's outsourcing has evolved to be a preferred method of doing business by companies for numerous positive reasons. As outsourcing fulfills a need that transcends virtually all businesses, outsourcing has also caught the eye of the investment community. Any business that helps other businesses perform better are well positioned to prosper far beyond the millennium change.

Some of today's common reasons to outsource would be to:

· Reduce and/or control operating costs
· Improve company focus
· Access to additional resources and redeployment of internal resources
· Free up resources for other purposes
· Accelerate reengineering efforts
· Accelerate migration to new technology
· Share risks
· Enable quicker response to business drivers
· Transform capital expenses and fixed assets to more flexible monthly expenses

An outsourcing vendor cannot be selected based upon the lowest price. Both short term and long term goals must be realized to prevent outsourcing from becoming your worst nightmare. For vendor selection, serious consideration must be given to:

· Cultural match
· Commitment to quality
· References and reputation
· Flexible contract terms
· Additional, experienced and available resources
· Price