The decision to use outsourcing to improve accountability, reliability and scalability is becoming a strategic boardroom issue. As David Rabson explains in a recent article in the Sunday Telegraph supplement Business Reporter “Businesses want to get to their destination quicker. They are looking at outsourcing areas that are not necessarily core to the business, but they recognise them as still being critical ingredients to its success.”
When a company outsources, it drives capacity into other areas of its business, giving people the space to focus on innovation and competitive advantage. It also helps improve its accountability for performance, with greater expectations being placed on the outsourcing provider than would be in its own internal team.
“One of the biggest balances from a boardroom perspective is being able to outsource without losing control,” says Rabson (inset). “If you are working with the right service provider, they should actually be keeping you better informed and give you more control.”
Rabson goes on to say: “The decision to outsource can halve your journey time.” For businesses planning or undergoing rapid changes, outsourcing improves the speed (and often quality) of execution. “We see complex transformational projects that might take 18 months to two years with a solely internal team taking nine months to a year having outsourced.”
But Rabson warns outsourcing is not the silver bullet to something that may be underinvested and poorly operated to start with – it does not right all of those wrongs. A company might need to go through a stage of transition and transformation with the service provider to achieve the full potential of outsourcing.
Another important point to consider when choosing an outsourcer is the cultural fit between the client business and their other service providers.
“That can sometimes be missed by the larger outsource providers servicing mid-sized organisations,” adds Rabson. “They have one set of rigid processes that they adhere to, which do not necessarily always work in smaller, more dynamic businesses.”