June 22, 2016 3:31 pm | Updated 5 years ago.
When large Corporations in the US took a giant step into Technology and Process Outsourcing more than two decades ago, labour arbitrage was a key value driver for consideration of the Sourcing Teams in these Global Companies. With the passage of time, the concept of Outsourcing got more refined, there were many lessons learnt at the Vendor and Customer ends and other value drivers emerged as basic must haves before embarking on an outsourcing journey. Faster, better and cheaper became the key mantra for outsourcing. Faster, as in increased efficiency and productivity through improved turnaround times for delivery offshore along with quantified business impact. Better, through stringent quality norms and established service delivery maturity of the teams offshore leveraging quality tools like six sigma and lean and cheaper not necessarily through the labour arbitrage route which these days no longer impact the Outsourcing consideration, but cost out of operations through better and intelligent planning at both the Customer and Offshore Service Provider ends.
What makes an offshore outsourcing work?
Is it merely strict SLA adherence, or following the SOP and other metrics rigorously and the rule book? Is it a one-sided journey or does it take two to tango i.e. the service provider and the Customer? From my own practical experience and journey with outsourcing as a Global Delivery Head of a large Service Provider offshore, the journey is not as simple as it sounds and requires a tremendous stretch of all concerned parties to make it a win-win. Outsourcing can be compared to a Philharmonic orchestra where the musicians deliver a stellar performance in front of a rapt audience by synchronizing the tunes as one team!! One member of the team is out of tune and imminent disaster written on the wall with irreparable damage and doom!! To elaborate on the Philharmonic orchestra comparison with outsourcing, the teams on site and offshore need to be flexible, cut across cultural and geographical barriers and develop a global mindset, cut aside ego, be open to out of the box thinking and learn from each other, communicate more often than not through rigorous on-site and offshore processes defined specifically for that, bond as one team and get over the vendor customer equation, build an atmosphere of mutual respect, trust, sincerity , loyalty and transparency, build a solid foundation for Program Management on site and offshore with established Program Management Methodology and rigour clearly defined on site and offshore, superior Program governance structure established, Effective Change Management and preparedness both on-site and offshore, leadership clearly communicating offshoring does not mean job cuts but actually redeploying people and helping them perform more challenging roles, team huddles, reward and recognition /incentives for teams performing above and beyond expectations both on-site and offshore, onsite and offshore visits from both ends, so that the service provider becomes a natural extension of the Organization taking strides into offshoring for a win-win at both ends. Anyone piece not in tune or synch with the other piece would signify doom for the Orchestra!! However, mature Customers and Service Providers on-site and offshore over the last two decades have more or less perfected on establishing a win-win through some of the examples I cited earlier on making outsourcing work first time right!! There are several best practices established around outsourcing which I will share in a later blog.
Author: Subrata Dutta