OneNeck White Paper
Outsourcing Best Practices
- A Primer on Outsourcing GovernanceBy Chuck Vermillion, CEO, OneNeck IT Services
White Paper_Governance_03_23_07.1 1 3/23/2007 1:08:05 PMOneNeck White Paper
FOREWORD In fact, IT is now as integral a part of business as is ? nancial reporting, manufacturing processes or even chairs and desks. In the coming years, As described by Mike Atwood, Principal of the Everest Group in his it's possible that the roles of CIO and COO will become one in the same, article The Art of Governance: "An outsourcing relationship is like a and IT capabilities will ultimately dissipate into the organization as marriage. The romance of the courtship or the airtight codicils of the fundamental operating skills required by any executive. This complete prenuptial agreement do not contribute to the ongoing strength of the integration of IT into the business causes information to become the relationship." driving force, not any speci? c technology.And when it comes to the vitality and longevity of today's successful To ensure that IT outsourcing companies - who operate with a outsourcing relationship - based on a mutual governance framework tremendous amount of responsibility in our new age of compliance and - it is wise to ? rst look back on the evolution of outsourcing. oversight - are indeed working to further the interests of their partners and not just themselves, companies often create a framework within The escalating reliance on IT in the past 20 years has brought an entirely which the outsourcing partner must perform. It's within the bounds of new dynamic to virtually every business, regardless of size. The way in this outsourcing governance framework that many relationships will which IT infrastructure is managed has taken on increasing importance. either succeed or fail.So too has the relationship between managers of IT and managers of operational business groups. Today's CIO and teams of IT managers Since the 1980s, there's been a great deal of discussion and posturing need to run a cost-ef? cient organization and build an infrastructure that on both sides of the company-outsourcer fence regarding the structure will ultimately help the company increase sales. It's a classic investment- of outsourcing governance. However, we've learned that all the rules in spending scenario. Indeed, a fair amount has been written in recent the world won't ensure the successful deployment and management years about the differences between the mindsets of business managers of an outsourced relationship. Clearly, the need for effectively de? ned and the IT managers who work for or with them or their outsourcing mechanics and service levels is important, but all those checks and partners. Regardless of philosophical differences, it's dif? cult to dodge balances are only as good as the cultural alignment of the two partners.the inevitable question: "Who knows best?" OneNeck has developed a fairly simple de? nition of cultural alignment In their management-mandated quest to reign in IT costs, IT executives through our years of providing outsourced information technology turned to outsourcing as an effective way to run a state-of-the-art services to mid-market businesses. We believe that the recipients of operation without breaking the corporate bank. In many ways, services should be able to trust the motivations of the provider of those outsourcing is the optimal solution to the problem. In an effective services. This sounds easy but is in reality, very hard to achieve. outsourcing relationship, IT organizations can focus on strategic issues Although it's often misunderstood, outsourcing is not a new concept. and goals, while the outsourcing partner takes on the operation and The ? rst supply and demand relationship was effectively the outsourcing maintenance of some or all of the company's systems. With outsourcing of a speci? c set of functions. When you purchase a packet of frozen came the need for effective governance to ensure an appropriate level of peas at the grocery store, you have effectively outsourced the growing, control and oversight of a third party provider. harvesting, packaging and delivery of those vegetables. It's just another This white paper focuses on ways to eliminate the dangerous question case of demand aggregation equating to improved price-performance, of "Who knows best?" by suggesting ways in which companies can predicta... [download for more]
