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Consulting styles in outsourcing |
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The old adage "you'll never get fired for hiring x" rings as true now as when it was first coined. This often pushes companies into hiring the wrong consulting company, who might choose the wrong methodology. The cookie cutter approach often many adopt by consultancies means they overlook the potential benefits of a more flexible approach. These outsource projects are often successful in implementation but fail during the life time of an outsource relationship. With a near 50% failure rate in outsource contracts perhaps it is time to reassess how we run an outsource project. 9 out of 10 failures are put down to people issues; perhaps this is exacerbated by choosing the wrong methodology from the start.
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SME outsourcing for business continuity |
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In this article from Computer Weekly the author talks about the common issues many SMEs face when considering business continuity. Their IT systems are so centralised that issues can bring the business to its knees. Even companies in multiple locations rely on centralised systems. Without a solid, tested, business continuity plan many SMEs are putting themselves at risk. Risks can often come from unlikely sources. One company I was working with had a fire, then a hacker attack in the space of 6 months. Both times the operation was effectively shut down for days while everyone raced round desperately trying to get essential systems back up and running. This is where outsourcing can offer a competitive advantage. By moving servers to a managed environment, using Software as a Service or transferring the whole IT department to an outsource provider, the risks can be greatly reduced. Outsource vendors make it their business to offer these services and attempt to be "Best in class". This means they will take business continuity and treat it of paramount importance. Leveraging this expertise reduces risk and can often offer a reduction in cost than in-house IT departments. Here is the full article.
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In the following article from Whatpc the author talks about the issues with an adversarial relationship between clients and outsource vendors. Clients not only want low prices but vendors to continually innovate within their core competencies. The article recognises that both sides need to be realistic in their expectations. Vendors often oversell to will the contract and buyers want ambiguous statements about innovation to be fulfilled. The full article can be found here
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African vendors target quality rather than quantity |
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The article in the National Media website discusses vendors in Africa targeting the same clients and trying to differentiate themselves from the competition. This is proving harder and harder in a crowded vendor market. Investment in high end outsourcing means that Kenya is trying to focus on tier 1 clients. This is a mistake. There is a flourishing tier 2 and 3 market that are crying out for vendors who focus on their areas of expertise. The fight for the big players is too competitive with high expectations and often low margins that rely only huge volume. Kenya and other African nations would be better concentrating on higher margin, more specialised work. Delivering tailored relationship deals for low volume, higher margin clients. You can read the full article here
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Outsourcing to America!!! |
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Some of the concepts of outsourcing are to move to where the risk is reduced, expertise is situated and last but not least, where the cost is reduced. This means going wherever is most logical. In the case of this article, the author is describing the outsourcing of computer storage and processor power to the US. Companies and consultants should never discount any location. Once of the examples provided was a payroll system was moved to rented services in the US slashing costs. As is pointed out, it is large companies that often benefit the most from outsourcing of this kind, but many hosting companies are springing up that cater for smaller enterprises. For the full article click here
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