Strategic Outsourcing

"Like marriage, outsourcing is much easier to consummate (improperly) than it is to terminate, and recover from, if done poorly."

"As with any significant new initiative, planning activities, including project management issues, are important."

"It is better to stay ahead of the employee morale curve."

"It is important to involve the lawyers early on in the outsourcing initiative."

"Make it happen, or prove why it cannot be done!"

"An organization can recapture customer focus by changing from a functional structrure to a process structure."

"If the competencies are fleeting, easily imitated, or belong to a few individuals who could leave, then they are probably not core."

"The projects should be launched and finished quickly."

"Without a full-time relationship manager, the organization may not be sufficiently engaged in the relationship, in monitoring and evaluating performance, and in addressing issues."

"One of the greatest opportunities to reduce costs comes not through outsourcing the activities, but by driving the related overhead out of the organization."

"The project team should understand the gap between the actual performance and the desired performance, the competitors' performance, and the outsource providers' promised performance."

"On the surface, it might appear that all of the costs to "make" a product or provide a service would disappear with outsourcing, but they typically do not."

"The final objective is to get five to seven proposals from the most qualified, interested, and cost-competitive providers, and to evaluate those proposals efficiently."

"The RFP should be designed and worded to illuminate, as much as possible, the underlying economics of the transaction."

"When the contract is drafted, key elements of the proposal could be incorporated by reference so the proposal's commitments don't get lost in the legalese."

"The tests of the providers' claims should generally be what might be called overstatements tests."

"Think of the negotiating process as a funnel in which the issues are placed in the top, and slowly, through analysis and discussions, the issues are addressed and agreement is reached at the bottom."

"A balance should be struck between the desire for specific and precise language and the need for flexible language."

"While the relationship manager and the team have worked closely with the provider to review the transition plan, get the appropriate input, and play their roles, the primary transition role belongs to the provider."

"It takes time to manage the relationship."

"How should the recompetition be different from the original and outsourcing initiative?"