Recycled Bullsh-IT

Many of you will have experienced the delights of outsourcing, either as a buyer or supplier of these services. In fact, it would be difficult to have avoided exposure over the last twenty years. Most people have tales to tell (not all complimentary) and it is now considered a standard practice to outsource (sometimes humorously called partnering) many of the non-core functions of your business. However, I have found that the adoption of best practice and innovative offerings are far from standard, with many organizations locked into inflexible and inappropriate contracts.

So, what is best practice these days? From the client perspective, the hard lessons learnt by the early adopters were as follows:

 They who write the contract win. For obvious reasons outsourcers tend to have more experience in outsourcing SLAs and Ts & Cs than your company. They will have hired some of the most evil and devious legal minds to craft their Faustian contracts, ready to trap you in their spider’s web of gotchas and get-out-of-jail-free clauses. The problem can sometimes be that:

a)      We think we’re red-hot negotiators and will cream the puny supplier, or

b)     The salesperson assured us everything would be fine, and they seemed very nice, or

c)      It’s only an IT contract. What’s the worst that could happen…?

If you don’t have your own team of hardened lawyers and procurement rottweilers, expect to spend the length of the contract feeling… the length of the contract.

 If you outsource a problem, it will be more expensive and painful than if you fix it yourself. Outsourcers love to take on your problems because they can charge outrageous sums to fix them. In fact, the bigger the mess the more they can gouge you for as you obviously don’t have a clue and they might as well take you to the cleaners. You will be buttered up with soothing phrases, such as: “Don’t worry”, “We see this all the time”, and “Just leave it to us after you sign this blank cheque”. There are only two good reasons to outsource:

a)      Someone else can do this work to the same level of time & quality, but cheaper, through economies of scale or exploiting some other workers with less employment protection than your rabble

b)     You are unable to sort your own act out to recruit and motivate your team to fix and run the service. In which case you might think about resigning and allowing someone who knows what they’re doing to take over. I’m happy to talk to your boss if you want a push 😉 

Whatever way you go, fix your organizational and process issues before engaging your partner.

 Relationships matter. Treat your outsource supplier unreasonably and they will take their revenge, sorry contracted compensation, through painfully close adherence to the agreement, assignment of a B-team to your account and a bill for every phone call you make to them. Treat them well (multi-level active relationships from board level to day-to-day operations, creating shared goals and value generation) and you will get service to the spirit of the contract not just the letter. See Partnering for Profit or Pleasure.

 Out-tasking beats outsourcing. A semantic point, but breaking down your functions and choosing separate partners for them can normally prove more successful than dumping the whole of IT to a single supplier. This has an increased contract management overhead, but you retain both increased control and flexibility in the cost and quality of the services delivered. If your company demands rapid change or cost reduction, it is easier to accomplish this with a more granular portfolio. 

If you think it would be easier to manage a sole partner by having just one throat to choke, remember when it all goes titsup the strangulated voice will be issuing from your lips not theirs, as you get squeezed by your business execs on one side and your immovable ‘partner’ on the other.

 Lockdown and remote working have accelerated the interest in outsourcing many more services and roles that would never have been considered a year ago, as we’ve now proven our jobs could be done anywhere. Possibly be someone else who is more desperate, faraway and lower cost than you or me. Time to remind your boss why you are indispensable…

 John “In, Out, Source IT All About” Moe