Doug Elix, General Manager, IBM Global Services-America, advised outsourcing buyers to ‘pick your partners carefully. When you get into these business transformations,’ he stated, ‘then the relationship is very, very intimate and intertwined. It is hard to tell the differences of who is working for whom.’ He added that in 1999 we would see ‘a move to put some meat behind the word ‘partnership.’
Companies like big vendors because they have many resources at their disposal and through years of experience have gained a great deal of knowledge about the network infrastructure business. But as Jeff Winston, vice president of information technology at Allergan, Inc., looked at five or six communication vendors in early 1996, there wasn’t any objective data that pointed him away from Infonet
Outsourcing receives its share of bad press, and usually the negative press has to do with companies complaining about their suppliers not fully understanding their business, says Rob Grimes, CEO and chairman of CynterCorp. And without a fair amount of knowledge of the company that the vendors are dealing with it is difficult to create a partnership scenario.
It is fairly difficult to get a solid business relationship established and defined in a contract, and also allow for the required need for change, says Dave Burkett, president of Compass America.
The key objective to structuring an outsourcing relationship is for the vendor and supplier to jointly identify what their objectives are, or in other word what they want to achieve.
Changes occur frequently in outsourcing relationships. And paying for results is one mechanism that can help customers achieve flexibility in the arrangement, says Eugene G. Lukac, CSC’s Principal for Application Value Management. Many outsourcing contracts do not focus on results, but focus on effort.
There is a lot of talk about BPO being the business model of the future. Although I don’t think that people necessarily recognize it quite this way, what is unique about BPO is that it is a win all the way around, says Charles Gibbons, who recently joined PricewaterhouseCoopers (PwC).
Most companies that have outsourced in the past like what they’re getting and are coming back for more. The most telling statistic to support this is the fact that 90 percent of the current outsourcing projects that are being planned are from companies that are currently outsourcing.
Outsourcing is stabilizing in Australia and firms now have a better understanding of what can potentially be outsourced. So Fiona Rhode, lecturer in Information Systems in the Department of Commerce at the University of Queensland, assumes that outsourcing will continue to grow throughout the country.
Utilizing the knowledge gained from Y2K efforts, dramatic improvement of the business model is possible. Through a process called Strategic Business Modeling (SBM) this valuable information can be organized for the move to a new business environment. For many companies that means enabling or moving legacy business function to a new infrastructure, allowing for ease [...]
The old information technology (IT) outsourcing model is changing. While many companies still choose to use the much-used model, innovative customers and suppliers are approaching outsourcing from different angles, and in the process are advancing the model to meet new demands. In today’s business world, outsourcing is becoming more strategic as well as more complex.
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