Say the word “outsourcing” in many organisations, and you’ll be met with a frosty reception. People will recount tales of how huge chunks of their company were laid off or sold off, and will talk about how things have never quite been the same since. They’ll talk about how it used to be possible to respond to changing customer demands quickly and swiftly, but now implementing any change takes forever because there is a rigid and inflexible contract in place with an external partner… and they may well argue the case for bringing the outsourced capability back in house.
In fact, in some organisations the word “outsourcing” has become a dirty word. Saying it creates controversy, and can even create ill feeling. There is no doubt that some companies have entered into ineffective outsourcing arrangements—perhaps they have chosen the wrong partner, outsourced a capability that was better serviced in house, or perhaps the relationship went sour. However, it’s important not to discount an entire solution approach, and in the ever-changing business environment that we live in, strategically outsourcing activities to carefully selected partners or Managed Service Providers (MSPs) can yield significant benefits. Whilst there are undoubtedly examples of outsourcing going wrong, where it is implemented well can be very beneficial indeed. It can help organisations to smooth demand, to expand into new areas quickly, and to secure expertise that they don’t want to (or can’t afford to) employ in house.
I’ll tell you what led me to write this article. Just the other day I realised that my car is overdue its annual service, and I was trying to figure out which garage to take it to. I was discussing this with a good friend of mine who knows a lot about cars, and he offered me some useful advice:
“Adrian, your car getting old. It’s important that you service it but the service history won’t add to its resale value any more. Why don’t you do a basic service yourself?”