July 21, 2005
Executives Must Get More Involved In Outsourcing Contracts
In what seems like the 100th study released in as many days Logica CMG has once again released a report relating to the future of outsourcing. In the report, headed up by Professor Leslie Wilcocks of the Warwick Business School and Sara Cullen of Cullen Group, is outlined their 'Top Ten' predictions for the future of outsourcing. The most interesting of these is the fact that they argue that nearly 1 in 3 failed outsourcing endeavors does so because of a lack of CEO involvement. While arguing rather generically that a CEO should care about its outsourced contracts because they form an increasing percentage of expenditures and because it can radically effect the public valuation of a company, it nonetheless contends that many CEOs are entirely uninvolved in the process. Because of this, an increasingly common practice is to have clients rather than suppliers dictate the terms of the contract. This has given more active CEOs an advantage by allowing the contract to be shaped in such a fashion as to provide them with leverage over the supplier. Many CEOs do not take advantage of this opportunity, however, and find that their company has not achieved the the level of cost savings once anticipated. publictechnology.net reports:
"The study illustrates that CEO involvement will help mitigate risk and enable and organisation to use the outsourcing deal to create a more competitive position," said Simon Ormston, Outsourcing, LogicaCMG.
Read More: Warwick Business School deliver 'top 10' outsourcing predictions for next 5 year
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can you explain how the "IT DOESN'T MATTER" by Nicholas carr is used for outsourcing and also issues facing an IT manager by outsourcing in his/her organisation?
Posted by: sudhir | Dec 11, 2007 3:07:39 PM
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