Article 3 of 3
The third and last article from short series also deals with the results of the study “Ardour Sourcing Pulse Check” by Ardour Consulting Group (www.ardour.de). Within this article we concentrate on the findings regarding the level of satisfaction and of achieving the customer’s targets. At the end we will introduce software called “Outsourcing Advisor” which addresses all important aspects and enables a fast and easy definition of a realistic outsourcing strategy.
The study has shown that independent from the specific industry affiliation, the companies try to reach similar targets. In nearshoring and offshoring projects the targets are primarily a higher flexibility in and reduction of costs. In contrast, the main target within an onshoring project is around reaching a higher service quality. This difference relates to the lower labour costs available in the typical nearshoring and offshoring countries.
The results of the study within the field of customer satisfaction demonstrate that approximately 40% of the organisations are perfectly satisfied or satisfied. About 37% of the organisations are partly satisfied and around 23% are dissatisfied and highly dissatisfied. The question which has to be asked is, if this is directly related to low performance etc. of the service provider or if this results from wrong assessments or goals of the outsourcing customer organisation. Especially organisations with little or no experience in outsourcing have to carefully prepare the outsourcing project before implementation. One critical step is to build a realistic expectation and to assess all potential outcomes in advance.
Especially for these challenges pliXos developed the Outsourcing Advisor. It is a Cloud based software which can be easily obtained via internet in form of Software-as-a-Service (SaaS). No integration into the customers IT environment is required and access from any location and most devices is given. With the help of the Outsourcing Advisor the customers will be able to perform extensive calculations of the business case of an IT outsourcing project, analysis of the outsourcing suitability and assessments of the outsourcing sites as well as of the potential partners. The necessary know-how is build into the software and no expensive consultants are needed, a factor allowing to keep any investigation of future sourcing strategies confidential and avoiding this to be visible to anybody outside of the ones directly involved.
Before starting the calculation of the business case of an outsourcing project, it is recommended to start with the analysis of the outsourcing suitability of applications, specific software modules or dedicated projects. To enable the calculation process the system will use different factors such as the processes, the technology, the application or project scope, the interaction of the individual factors as well as the project complexity. Finally, the suitability feature even enables the consideration of the corporate strategy and therefore reviews if outsourcing is in line with the other intentions. Within the calculation of the business case the potential internal costs are compared with the external costs. The user of the system can profit from a verified and validated model which helps to make sure that no important relevant factors are missed out. The third feature, the assessment of the IT service provider and the location allows identifying further key aspects for the success of any outsourcing project. In addition to the through the location determined macro-economic and cultural factors the system enables also to consider the potential performance capability.
In summary the Outsourcing Advisor enables more realistic upfront analysis and strategy of an outsourcing project and therefore minimizes unrealistic expectations in advance. The software can be seen as a low cost substitute for cost intensive outsourcing advisory services. Especially for organisations with no given outsourcing strategy or which do not want any visibility of the investigation at this point, the outsourcing advisor enables a well-founded evaluation of the potential project. Experiences show that through the use of the Outsourcing Advisor the organisation can significantly improve the satisfaction rate as well as the extent to which the goals are achieved.
With this article our short series of three articles comes to an end. Our special thanks is extended again to the Ardour Consulting Group which enables this series through their impressive study. Looking back the first article dealt with the challenges in sourcing governance within an outsourcing relationship. The second article highlighted the enormous influence of the selection process of the service provider and introduced a B2B Marketplace which provides an appropriate framework for both, experienced and inexperienced organisations. If you missed one of our articles or if you want to reread them, you can find all articles at our homepage at http://www.plixos.com/en/plixos-blog-2.
pliXos sees itself as a specialist in IT Outsourcing, especially for outsourced software development (offshore/nearshore). We are not only offering services as a classical service provider does or expected from a pure consulting company, but instead further enrich these offerings with innovative online products throughout the project life cycle of an outsourcing project to be most effective. Our offers include "tool-assisted" evaluation and analysis of global sourcing projects, the optimized control of such projects as well as consulting and the assumption of overall responsibility for individual projects. pliXos is supported by private investors as well as the “High-Tech Gruenderfonds”(www.htgf.de) and "Bayern Kapital" (www.bayernkapital.de).
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