Love it or loathe it?
Outsourcing is now a permanent feature of business life. As companies search for cheaper and more effective ways of working, handing over non-core functions to lower cost specialists can be an alluring prospect.
But before you bring in third parties to run parts of your business, it is worth pausing to consider the risks. Some outsourcing deals fail dramatically and publicly. Rather more are quietly set aside as one (or both) parties look for an exit and an even larger number limp on, failing to deliver quite the benefits that were expected. There are however many success stories – businesses that have used outsourcing to achieve dramatic savings, shed themselves of expensive assets or build the capacity to grow in a way that would not have been possible using in-house resources.
So how do you become one of these success stories and avoid the pain, cost and frustration of a failed deal?
Whilst there is no magic bullet, a combination of common sense, a structured approach and learning from others’ experiences will go a long way. This handbook is intended to help you do just that. It is not an exhaustive guide to every aspect of outsourcing, but it does lay out the full lifecycle of an outsourcing deal and help you understand some of the key issues, challenges and decisions that you will be faced with at each stage. We’ve based it around our own outsourcing methodology, which acts as a checklist to make sure all aspects are considered at each stage in the process. One poison pill that will almost certainly guarantee failure is treating outsourcing as ‘just another’ procurement. You’ll see that much of the content in this paper encourages you to take a much broader view of outsourcing, considering everything from change management to tax optimisation and regulatory compliance.
Each part of the paper focuses on one stage in the lifecycle, beginning with the all important initial ‘Assess’ phase, when you first consider the pros and cons of outsourcing and determine the right strategy for your business. As you look at this do please bear in mind that here at FORFIRM we are not advocates for outsourcing, nor do we supply outsourced services. We’re simply here to help our clients make the right decisions. The paper reflects this, recognising that a structured decision not to outsource a function is as much a victory as a successful outsourcing deal.
Whilst you may want to look through all of the content, this isn’t a book that you have to read cover to cover. Each section is designed so that you can dip in at the point that is most relevant to where you are with your outsourcing activities and extract some real value based on our experience. We’ve structured our approach so that it is relevant to both Business Process and IT outsourcing (BPO and ITO), using onshore and offshore resources. While the approaches and tool set work across all industry sectors, we have pulled out some features where there are industry-specific differences; one example is procurement, where public sector organisations are usually required to comply with EU Public Procurement Directives.
This handbook has been written by FORFIRM’s team. No copywriters were involved and there are no sales pitches, although we would urge you to think hard about the help you may need as you progress your outsourcing activities. Embarking on an investment that may run into tens or hundreds of millions of Pounds is not for the faint-hearted and having an experienced adviser by your side will help your project join the ranks of the success stories.
So wherever you are in your own outsourcing journey, whatever the scope of your outsourcing deal, and whatever your industry background it is worth reading this handbook.