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OUTSOURCING: The 'Pay As You Go' Model


Recent Western Cape Business News

THE growing demand for outsourcing is keeping its momentum largely due to its effective ‘pay as you go’ model. This is especially true for information communication technology, where managers have to keep tight control of their budgets.

The outsourcing model offers access to skills, resources and experience that would not otherwise be available to many organisations’ because of the financial outlay that is required in building these specialised proficiencies in-house. However, negotiating the minefield of outsourcing providers and outsourced offerings - and selecting the one that will work best with your organisation – can be challenging. So says Jaroslav Cerny, MD of RDB Consulting.

Taking certain key criteria into consideration when assessing an outsourced ICT service can be advantageous. These include the following:

Appropriately skilled technical staff: One of the fundamentals in selecting an outsourced partner is to ensure that all technical staff are appropriately certified according to their level of experience and position.

Multi-platform, multi operating system support: Not all businesses use the same operating systems and multiple types of OS’ are often used simultaneously. It is therefore important for an outsourced partner to have a good working knowledge of multiple OS’.

Pre-define the services offered, and how they are delivered: Service level agreements are fairly standard, and one should insist on one that includes clearly laid out details, such as mean-time-to-respond, mean-time-to-repair and escalation procedures all the way to the top level.

In-house developed, pro-active monitoring and alerting tools: Industry standard tools are often recommended with relational database or OS outsource contracts, but they usually come with a hefty price tag which is transferred onto the client. During times when budgets are lean, an in-house developed solution offered as part of the entire package (a value-add), can deliver the same basic functionality of industry standard tools without the severe dent to your budget.

Implementation of industry standards and best practices: The implementation process should be standardised and clearly defined from the beginning. This forms part of the ‘value-add’ consulting service that an outsourced partner should provide. In fact, advising the client of what must be standardised, implementation Best Practices and the benefits thereof, is often regarded as a critical mini-project.

Service Level Management: Your outsourced partner should include a service delivery manager to monitor the service delivery of the project as well as the quality thereof. This role or resource is mutually beneficial, as the outsourcer can feed this information into its CRM system and, from the customer’s point of view, grievances can be raised and escalated during implementation so they can be quickly and painlessly dealt with.

Regular management meetings: Regular on-site management meetings will allow the outsourced partner to communicate the progress and completion of project ‘milestones’ or simply let the customer know, in person, exactly how things are progressing.

Strategic partnerships with software vendors: Make sure an outsourcer has strategic partnerships with relevant software vendors. This ensures that the company remains up to date with all of the latest developments in the particular technology related to the project or for purposes of ongoing contractual support.

Comprehensive documentation: The client must insist on comprehensive documentation of everything that pertains to the project or ongoing support.

Achieving a significant ROI, according to Cerny, is crucial: While engaging an outsourced partner involves a cost, your partner should deliver benefits to your organisation that outweigh this charge.

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