I blogged yesterday about some troubled outsourcing contracts tahtb have hit the news recently. They paint a negative picture of outsourcing.
These included NHS Direct’s plan to pull out in its contacts to run NHS 111 and accusations that G4S has overcharged the government in relation to its contract to run a tagging service for offenders.
In an article today on Business Reporter the National Outsourcing Association (NOA) has called on suppliers and their customers to help change the opinion of outsourcing.
In the article Kerry Hallard, director for the NOA, talks about how a few failed projects create a perception that outsourcing is risky, when in fact a huge majority of outsourcing contracts are a great success.
The article quotes research by the NOA in 2012 revealed that 22% of the public dislikes outsourcing as a profession, while a huge 80% of the general public does not think the industry is helping UK Plc.
“We’re such an important industry, and we’ve got to create some kind of change,” said Hallard in the interview. “There’s a concern that while the government and the media are dealing out this anti-outsourcing frenzy, the big FTSE 500 companies are cautious about admitting to outsourcing, because they understand that public perception is negative and confused,” says Hallard.
I think it is very important that the failures are highlighted by the media and just because they write these stories doesn’t mean they are anti-outsourcing. The media are anti-bad outsourcing.
The IT outsourcing industry has the added problem of negativity being caused by job losses related to contracts. When IT is outsourced it normally means upgrades in IT which inevitable lead to less people being needed. The biggest savings are often made by reducing people costs. Then there is the controversial practice of offshoring jobs to low cost regions.
But there are some very good contracts. Read this: What makes a great outsourcing agreement?