Outsourcing
Outsourcing Today
• International focus is changing
• Outsourcing becomes a natural part of an
executive’s organizational focus and
success
• Primary reasons for outsourcing evolving
• Leadership skills grow and change with
inclusion of outsourcing
• Internet an integral part of outsourcing
business
The World Continues to Shrink
• Outsourcing growing in
western Europe
• Inquiries increasing
from eastern Europe
• Strategic Outsourcing
Council in Japan
• India and Middle East
providing technology
Executives Changing
• Before 2000, • Since 2000,
executives used outsourcing has
outsourcing to: become:
– Assist financially – Be a strategic part of
ailing companies the planning process
– Run legacy systems – Be provided by a
– Allow company to variety of specialized
focus on core vendors
competencies
Primary Reason to Outsource
Survey results at Outsourcing World Summit
1990s Reduce Costs
Focus on core competencies
2000 and beyond:
– Emphasis on shareholder value
– Transforming the company
– Innovation
Management Skills are Changing
• Prior to outsourcing, managers needed skills based
on operations. After outsourcing, client managers
need lateral leadership skills.
– Strategic thinking skills
– Ability to communicate horizontally
– Trust building skills both within the company and with the
provider
– Financial skills to analyze the true value of outsourcing to
the company
– Negotiation skills
– Ability to define and complete a deal.
Providers bring innovation
• Vendors should bring new ideas at startup:
MUST continue having new ideas and see
ways to improve the client’s business.
• Be focused on the client’s business and how
to meet the needs of their customers.
• Do much more than just meet SLAs.
• Bottom Line: Be proactive and innovative.
Keys to Successful Outsourcing
• Providing internet technology to customers
– Web enabling is central to every business
– Must have information accessible to both their
organization and their clients
• Focus on the client’s business
– Know the client’s business
– Work for the client’s success
– Show ways to improve the client’s customer’s business