| IT outsourcing contracts - in which certain IT systems | | | | can't, and which tasks it would be beneficial to |
| and services are handed, or 'outsourced', to a | | | | outsource and which should be kept in-house. |
| third-party specialist to handle - can be tricky beasts. | | | | The key components of this decision framework are:o |
| Managed well, they can be highly beneficial in terms of | | | | Describe in visionary terms what value outsourcing will |
| cost savings and efficiency gains. But without due | | | | create for the organisation;o Define the objectives of |
| diligence, they can end in disaster. | | | | the outsourcing decision in measurable components;o |
| It's no surprise, then, that they are frequently compared | | | | Define the scope of the services to be outsourced, full |
| to marriage partnerships: both take hard work; both | | | | or partial;o Decide if there is to be one or more |
| demand commitment and compromise, and both can | | | | suppliers;o Fully understand the impact on all |
| easily be sabotaged by misunderstanding and mistrust. | | | | employees, including those that may be transferred to |
| But above all, both are exercises in managing | | | | the service provider and those that will stay with the |
| expectations. | | | | client, as both groups will be affected;o Fully |
| In fact, a clear set of expectations, laid out in advance, | | | | understand how the client's staff will work and |
| is a determining factor in an outsourcing contract's | | | | communicate with the service provider's staff, from |
| success or failure, says Piers Harrison, a managed | | | | the board, through all levels of management right down |
| services specialist at Logicalis. | | | | to the end-users;o Fully define the starting position in |
| "When outsourcing contracts go wrong, it's often | | | | numerical terms: costs, staff, assets, and |
| because an organisation isn't exactly sure what it's | | | | accommodation utilised to a fair degree of accuracy;o |
| looking to achieve by passing certain tasks or | | | | Define how the new regime will be managed and |
| processes to a third party. In other words, its | | | | monitored;o Define an effective change and cost |
| expectations are unclear - both to itself and to the | | | | control management process;o Fully define the |
| provider," he says. | | | | management structure and associated responsibilities |
| That, he adds, makes it impossible for either side to | | | | between all parties.o Fully define the crisis |
| agree on what they're aiming for and as to whether | | | | management and escalation process;o Fully document |
| service levels are being met. | | | | all the above aspects and record in a formal contract, |
| What's needed upfront is a meticulous process of | | | | a service level agreement(s), and relate to all other |
| information- and data-gathering, to gain a full | | | | dependant sub-contracts. |
| understanding of what can be achieved and what | | | | |