Wednesday, January 23, 2008

Not Quite Ready

Read this excellent summary of signs that an organization is not ready for outsourcing. Almost every consulting engagement that I have been a part of, has suffered from a multitude of the malaises listed. But that did not dampen their zeal for outsourcing whatever was in sight - from back-office operations to core business processes and critical applications. While the results were far from pretty, never was it attributed to the organization's lack of preparedness.

Vendor SLAs are scrutinized, operational metrics are sought where none exist and blame is divvied up as convenient. Major unforeseen costs and inconveniences are attributed to the newness factor. It is generally believed once that wore off and everyone in the equation reached stable equilibrium all will be well.

Interestingly enough the clamor of the initial days subsides to a low din and just stays that way for the length of the outsourcing relationship. It is deemed an acceptable level of chaos because eliminating it is too expensive and therefore impractical. That it may be a significant contributor to lost business opportunity and impact customer retention does not appear to bother management unduly. You are exhorted to work around the challenges and seek out "opportunities" for improvement which is management-speak for a five-slide deck.

While I have often borne the brunt of trying to baseline metrics and monitor vendor performance and the like (a largely thankless and pointless exercise in gathering numbers just to have some digits on the ready to throw around as needed - not intended for driving meaningful change), I have yet to participate in a "
true cost" of outsourcing assessment specially over a 5-6 year window. Maybe it is for a good reason that some histories are best left buried.

1 comment:

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