Outsourcing Strategies and Trends
Outsourcing was the topic in the 1990's and quite frankly it was a feared discussion.
Outsourcing was introduced to business as a way to take cost out of the daily operational budget.
Quickly, outsourcing rose to be viewed as a possible partner to application development, marketing and labor augmentation.
Early in the 1990's and even now we see it morphing it's way to become more and more transparent within companies in the Fortune 500 and below.
Examples of new and innovative thought leadership regarding outsourcing is emerging every day at companies like CISCO(TM),IBM(TM), AT&T(TM) etc.
When outsourcing first became relevant it was viewed from two distinct directions.
Fear and hope depending which side of the bench you happened to be deployed.
As an employee the trend was to fear the word but as a shareholder it became something of a competitive weapon and earnings per share friend going forward.
If you could move operational requirements to another company/service provider and still get the same quality and service level agreements the logic flowed that this was a good practice to endorse and clearly use to hold back rising costs.
Quickly the companies that offer outsourcing like:EDS(TM) IBM Global Services(TM) CSC(TM) Northrop Grumman(TM) etc began to look at marketing tiers to strategize their domain expertise.
Today, you see defense contractors like Northrop Grumman, Boeing and others providing complete turnkey operations from staff augmentation to full lights out support for Cities, Counties and State government requirements.
A natural branch to their traditional Federal markets bread and butter.
If they can build a B2(TM), 777(TM) or and F/A 18(TM) I'm sure they can lend a helping hand to both State & Local government as well as the commercial markets they are trending to.
Of course, they must measure up and early deployments on outsourcing were mixed from a scorecard perspective.
Actual savings, depending on the PowerPoint/excel spreadsheet, were generating lots of second glances as to whether or not outsourcing was providing as advertised.
This was a double edged sword too.
The very companies providing the outsourcing were often caught up on post sales implementation challenges not always anticipated nor covered in their original bids.
This is the ouch in outsourcing.
On the one hand you have the customer is king attitude and on the other you have a contract/agreement whereby both parties signed up to a deliverable.
But, given the exposure politically the two sides would venture off the agreement to preserve the integrity of their announced relationship and try and work it out.
This is where the separation of powers collapsed around the profits and loss on a budget.
We will have more on this topic in later updates regarding outsourcing as it is truly stabilizing across niche markets with varying degrees of success and challenges.
Outsourcing was introduced to business as a way to take cost out of the daily operational budget.
Quickly, outsourcing rose to be viewed as a possible partner to application development, marketing and labor augmentation.
Early in the 1990's and even now we see it morphing it's way to become more and more transparent within companies in the Fortune 500 and below.
Examples of new and innovative thought leadership regarding outsourcing is emerging every day at companies like CISCO(TM),IBM(TM), AT&T(TM) etc.
When outsourcing first became relevant it was viewed from two distinct directions.
Fear and hope depending which side of the bench you happened to be deployed.
As an employee the trend was to fear the word but as a shareholder it became something of a competitive weapon and earnings per share friend going forward.
If you could move operational requirements to another company/service provider and still get the same quality and service level agreements the logic flowed that this was a good practice to endorse and clearly use to hold back rising costs.
Quickly the companies that offer outsourcing like:
Today, you see defense contractors like Northrop Grumman, Boeing and others providing complete turnkey operations from staff augmentation to full lights out support for Cities, Counties and State government requirements.
A natural branch to their traditional Federal markets bread and butter.
If they can build a B2(TM), 777(TM) or and F/A 18(TM) I'm sure they can lend a helping hand to both State & Local government as well as the commercial markets they are trending to.
Of course, they must measure up and early deployments on outsourcing were mixed from a scorecard perspective.
Actual savings, depending on the PowerPoint/excel spreadsheet, were generating lots of second glances as to whether or not outsourcing was providing as advertised.
This was a double edged sword too.
The very companies providing the outsourcing were often caught up on post sales implementation challenges not always anticipated nor covered in their original bids.
This is the ouch in outsourcing.
On the one hand you have the customer is king attitude and on the other you have a contract/agreement whereby both parties signed up to a deliverable.
But, given the exposure politically the two sides would venture off the agreement to preserve the integrity of their announced relationship and try and work it out.
This is where the separation of powers collapsed around the profits and loss on a budget.
We will have more on this topic in later updates regarding outsourcing as it is truly stabilizing across niche markets with varying degrees of success and challenges.
