The Black Book of Outsourcing

On the forty-second page of “The Black Book of Outsourcing: How To Manage the Changes, Challenges, and Opportunities” authors Douglas Brown & Scott Wilson, wrote (some emphasis added):

Table 2.1 Outsourcing Development Problems and Solutions Criteria Development
Problems		Solutions
Expectations regarding the outsourcing initiative or assignment are unclear.		At the beginning of the planning process, identify the purpose of the outsourcing project, the organizational resources available for the outsourcing project, and the specific type of outsourcing that would match the project.
A lack of understanding of the outsourcing project makes it difficult to identify and evaluate the costs and benefits of internal and external resources.		Allow enough time to research the project fully, contacting any internal or external experts available to your firm.
Failure to compare the costs and benefits of internal and external resources on an equal basis leads to inaccurate analysis. A comparison of FTE costs to the contract total does not account for the soft costs included in the contract. Costs to the buyer for in-house resources will be higher than a simple FTE count when soft costs are considered. Costs to the buying organization as a whole may also be different from buyer costs, as some operating costs may not be paid by the buyer using the resources (e.g., utilities, floor space).		Evaluate the project on a matrix or weighted average list, providing consistent examination of the same options when discussing both internal and external options. Be sure to clearly document costs and identify all formulas for deriving costs. This enables you to see what costs are included.
An accurate analysis of costs and benefits is difficult to make because there are no priorities in place to help identify and measure the needs of your business.		Use your strategic plan to identify priorities and establish weights for each criterion. Involve stakeholders and ask executive sponsors for input.
The hard-to-quantify nature of some of the soft costs and benefits, such as "business advantage" or "access to expertise," make these costs difficult to identify.		Identifying priorities and weights will help when including qualitative costs and benefits in the analysis. Establishing success measures that examine project outcomes in light of your corporate goals will add needed substance to the qualitative costs and benefits.

More information about “The Black Book of Outsourcing: How To Manage the Changes, Challenges, and Opportunities” (and the book itself) is available from:

• Amazon.com
• Powell's Books
• Barnes & Noble

(John Wiley & Sons, May 2005. Hardcover, 384 pages. ISBN: 0471718890; EAN: 9780471718895.)

Comments

[Supra Shoes]

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