2001 | Outsourcing Center

Cultivating a High Yield in Outsourcing

Outsourcing Center, Kathleen Goolsby, Senior Writer

The fourth largest steel company in the U.S., National Steel manufactures steel for the automotive, construction and tin container industries and has annual shipments of almost six million tons of flat rolled products. The company outsourced the housing and operation of its mainframe and data center services to IBM in November 1998 with a seven-year contract worth nearly $60 million. John Davis, CIO of National Steel, explains that they wanted to reallocate its human resources to solve National Steel problems, rather than technology problems. I wanted them working on solutions that would differentiate National Steel from other steel competitors, he says. The company has accomplished that and other goals, and their agreement has yielded far more than they asked for. But, after all, National Steel is no novice to outsourcing. In the 1980s, National Steel spun off its data center (which then became a part of ACS).

Magnificent Medicaid Management

Outsourcing Center, Kathleen Goolsby, Senior Writer

Medicaid is one of the most controversial, complicated and expensive programs in U.S. government. It’s very political, so there is a high level of interest, and there is also a lot of change going on in it all the time, says Peggy Bartels, Administrator of the State of Wisconsin’s Division of Health Care Financing. So any entity that provides outsourcing for Medicaid is going to be in a fishbowl environment. It’s very difficult. She explains that the process of reviewing and making determinations about whether or not Medicaid will fund services is all done under the very close supervision and administration of the State. Decisions are controversial. By being our business partner, the outsourcer invites the same criticism we receive, she adds. They’re in the bull’s eye, and it is a big challenge to do that kind of work and maintain a positive presence. Nevertheless, EDS took the challenge and has been the Medicaid fiscal agent in the State of Wisconsin since their outsourcing agreement began in 1977.

Digital Dilemma

Outsourcing Center, Kathleen Goolsby, Senior Writer

Without a doubt, today’s competitive forces have pushed the role and importance of customer relationship management up to the top rung of the ladder to success for organizations. As it is so vital, it has become a specialized area and an industry in itself. Thomson Consumer Electronics, which manufactures electronic products for the well-known brands of RCA, GE and Proscan, came to understand in the mid 1990s that customer care is a separate skill and a trade apart from manufacturing. We are in the manufacturing business. We wanted to develop a partnership with a company that had expertise in managing a customer care center and call center, recalls Scott Medawar, Manager of Customer Care Operations for Thomson. They began outsourcing these strategic functions to Spherion in 1997. Prior to their agreement, Thomson had operated its own call center and had a relationship with Norell to staff the center (Norell later became Spherion).

Getting a Handle on Purse Strings

Outsourcing Center, Kathleen Goolsby, Senior Writer

Because of its poor position with respect to costs (three years ago), the bank hired Peter Donald, an outsourcing veteran with noted success for the City of Melbourne. ANZ wanted him to identify outsourcing opportunities and to apply his prior successful principles in implementing outsourcing for the bank. Donald recalls that this departure from conservative thinking sparked internal challenges. Although the bank had decreed that something had to be done about its costing structure, there were degrees of tension among management when it came to identifying which opportunities might be selected. The opportunity identified was the bank’s procurement — its sourcing function — because it was not providing the level of strategic importance to the bank that was desired. We spend just under $1 billion Australian dollars per year in Australia and New Zealand (a total of about $1.5 billion worldwide) on a whole range of items from telecommunication to stationary, from technology to marketing and travel,

Zeal for the Zone

Outsourcing Center, Kathleen Goolsby, Senior Writer

BMC Software could not be more enthusiastic about its new and effective outsourcing relationship with ReleaseNow Corporation. As one of the world’s largest independent software vendors, BMC delivers the comprehensive eBusiness systems management software. It guarantees the fastest implementation so, naturally, that was a primary concern when the company decided last year to launch a new eBusiness Web site.

CRM Becomes A Star At ENSTAR

Outsourcing Center, Beth Ellyn Rosenthal, Senior Writer

The I Love You virus did very unloving things to the computers of email readers who couldn’t resist opening the infected note. The malicious message did billions of dollars of damage. And an avalanche of email messages brought down Yahoo in a DDOS (distributed denial of service) attack. These high profile events made companies realize the Internet is full of lurkers and some of them are evil people.

Outsourcing is Taking Three Forks

Outsourcing Center, Kathleen Goolsby, Senior Writer

Traditionally, outsourcing has been IT oriented. Today, however, outsourcing is taking three different paths. I see outsourcing falling into three distinct categories: the traditional IT suppliers,† the application service providers (ASP), and the business process outsourcing (BPO) suppliers. Different currents are buffeting each sector. Historically, IBM, EDS and CSCformed the top tier of the IT …

Outsourcing Grows as Economy Slows

Outsourcing Center, Beth Ellyn Rosenthal, Senior Writer

With the threat of Y2K glitches, many companies delayed outsourcing commitments during the final half of 1999. But companies returned to outsourcing in 2000. Megadeals lit up the landscape, says Bob Pryor, vice president of Cap Gemini Ernst & Young (CGEY) and head of its Global Operate – Americas outsourcing business in the U.S…

From Future Shock to FutureSourcing

Outsourcing Center, Beth Ellyn Rosenthal, Senior Writer

Compaq buyers want their outsourcing vendors to introduce innovation and add value to their outsourcing contracts, observes Thomas Simmons, vice president, eBusiness Management Services for Compaq Global Services in Stow, Massachusetts. Buyers want their vendors to be part of managing today’s complexity. They want us to think of different ways of doing business that they would never have thought of, he says.

Outsourcing Now Has Ebusiness Component

Outsourcing Center, Beth Ellyn Rosenthal, Senior Writer

When buyers decide to outsource today, you can bet ebusiness considerations are part of the contract. Paul Cofoni, president of the technology management group at Computer Science Corporation (CSC), says he rarely sees an outsourcing proposal that doesn’t have a substantial ecommerce component. Companies want to create a business-to-business (B2B) exchange, use ebusiness to enhance their supply chain management, or simply make it easier for their clients to have access to them…

Research & Insight

Year archives: 2001

Cultivating a High Yield in Outsourcing

Magnificent Medicaid Management

Digital Dilemma

Zeal for the Zone

CRM Becomes A Star At ENSTAR

Outsourcing Grows as Economy Slows

From Future Shock to FutureSourcing

Outsourcing Now Has Ebusiness Component

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