Outsourcing and communications expert Martyn Hart looks at a hot
issue of the day."Surely," I was told by a leading IT manager,
"you'll rename the National Outsourcing Association the National
Insourcing Association now." He pointed triumphantly to the news
about Xansa and The Bank of Scotland demerger and then mentioned a
SOCITM report about how outsourcing costs 25% more.
He went on, "Even your own CW360.com has an item about
outsourcing not cutting costs. Let's face it, mate,
outsourcing is over."
Maybe my erstwhile chum had missed Gartner's latest work saying
that in IT, outsourcing was the only growth area, giving a
conservative 10% compound annual growth rate (it's conservative
because it's the lowest figure I've seen). And business process
outsourcing is growing by 30%.
But read a bit deeper and you will see that most of these more
positive reports have been produced by people with a vested
interest in IT. Let's face it, turkeys aren't going to vote for
Christmas.
In fact we've seen all this before, when it was the Telecoms
Managers Association. TMA surveys of telecoms managers always
pronounced that outsourcing wasn't catching on, until there were no
telecoms managers left.
The TMA took a sensible decision and recognised that only by
delivering business value would their members survive, and changed
its name to the Communications Management Association. Not
forgetting its heritage, it now concentrates on helping its members
deliver business value through communications technology and it has
survived.
The NOA takes a different stance. We believe that if you can't
equal or better the benchmark with your in-house delivered
services, then you should outsource, core competence or not,
because if you don't, then even a mediocre competitor may be
beating you. Think of the management time you're wasting on doing
something second best.
Outsourcing comes in two flavours, strategic and tactical. If
you're just looking for cost savings, you're tactical, you're
probably deep in the detail and maybe you can't see the whole
picture. If you are strategic, you're solving business problems
and, according to CIOs that are members of the NOA, having
fun!
What's your view?
Is it all over for
outsourcing?
Let us know with an e-mail >>CW360.com reserves the right to edit and publish
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Martyn Hart is chairman of the
National Outsourcing
Association and practice director at
Mantix, a consultancy
that delivers value from complex programmes.