IT Outsourcing Implementation: Some Challenges and Their Solutions
IT outsourcing initiatives are vital for firms that try to focus on their core competencies and want to attain significant cost reductions in some non-core processes.
To find the best service provider, extensive thought goes into the selection process with the aim of enlisting the vendors that have a good reputation, competence and enhanced service levels. Since outsourcing to India can act as a catalyst for quick changes and cost reduction, IT organizations are looking forward to outsource their back office processes like payroll processing, indirect procurement, and boost their customer care service levels.
Today, outsourcing has become a standard business practice and with new risks and challenges surfing up, outsourcing initiatives are also growing that includes complex business options, integration issues and governance requirements. If all these risks are not managed efficiently, then they can have an adverse impact on the organization’s financial performance, reputation and operating model integrity.
Some Key Issues to Consider While choosing IT Outsourcing Services:
Post contract processes and decision rights:
Based on the outsourcing implementations, it is very important to understand the post contract process and the decision rights. Without clear understanding, the results, simply aren’t performed and the implementation activities also get stalled and both the client and the outsourcing company gets frustrated.
Client team too small or not in place:
With multiple outsourcing implementation, there may be a lack of a governance team or as there may be no one to direct the traffic to handle both the complexity and the volume. Clients often expect that since they have outsourced the work, it is the total responsibility of the service provider to take care of everything.
Poor knowledge transfer:
IT outsourcing solutions often create some uncertainty for the existing employees and this uncertainty can cause the staff to look somewhere else for employment and leave the company even before the implementation of outsourcing. It is very important to properly motivate the staffs with good knowledge transfer sessions so that there is no operational risk.
Also Read: IT Outsourcing Trends 2020
Overcoming The Problems and Driving Business Success:
Some outsourcing problems are listed above which seems significant and they can be readily overcome with awareness, focus and high attention. It is by recognizing the issues at an early stage that both the clients and the service providers can stay ahead of the game and can drive early. Some top actions that need to be taken are:
Leadership vision and commitment:
The client looking for IT outsourcing services must hold substantial one to one discussions with the service provider during the pre-contract stage and also during the implementation. At this stage, the service provider is responsible for delivering the outsourcing services and should meet the client and sort out all concerns and issues.
The client should also paint this vision and commit management staff to attain the intended results.
Procedural and organization alignment:
Both the client and the service provider should jointly design the key operational processes and the decision rights before prior implementation.
They must also initiate and complete the design for the overall retained organization. The retention policies should address both the contractors and the employees and should be developed as part of the outsourcing strategy.
Change acceptance and adoption:
A comprehensive communication program should be delivered to all the stakeholders who are to be affected by the changes from outsourcing. All the communication strategies and messages should be targeted to different levels of one to one communications and forums to personalize the message to all.