Thought for the Day:Are you ready for risk?

Outsourcing and communications expert Martyn Hart looks at a hot issue of the day.What about getting someone to take all risk...

Outsourcing and communications expert Martyn Hart looks at a hot issue of the day.What about getting someone to take all risk while you have all the rewards? Nirvana or what? But read on.

I found an old chum telling me just that. He's landed a job integrating five major (£25m) autonomous CRM systems into a single cost-effective unit.

Now four months into the job, is he worried? Not at all, he's relaxed. In fact, he takes long golfing holidays.

Well, as a public service I wanted to know more, how did he do it? Five jugs of Red Stripe later I got the gist. He's placed a major contract with a well-known Big Seven consultancy to run the whole programme. They work at cost and, if they complete on time, receive a bonus, so their balls are really on the line to deliver.

My friend's responsibility is to be on the programme board, so he has reached nirvana: he has all the benefits while they take all the risk.

This is such a sweet deal, he said, that when it's finished in three years' time, he'll be grabbed by a consultancy at partner level, work two days week and earn as much as now.

Sounds really good. All reward, no risk, no responsibility. I wouldn't be writing this if I didn't think there was a moral here somewhere. What would you think?

I asked a few questions. What is this "at cost" day rate? Answer: £650. How many consultants? Answer: 390. Where were they? In upmarket premises in the centre of London which he pays for. How do they manage the programme? With their own world-class, best-practice, fully approved (by them?) method. Can I buy a version of this? Oh no, it's their trade secret, a special method.

Had he visited them? Often. See many new faces? All the time.

So who is at risk here?

At the National Outsourcing Association, we have a saying: "Lose all the risks, lose your business!"

Want to buy some shares?

Have you reaped the rewards while others took the risks? What's your secret? >>

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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.

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