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Outsourcing is a word we are all familiar with but governance of the outsourced projects came in much later. Why are some outsourcing relationships successful, while others struggle or fail? While these complex relationships require strong processes, skills and tools to succeed, outsourcing excellence depends on a governance operating model based on principles, rather than rules.

With the evolution of the outsourcing industry the need to govern still remained while the means and ways to govern the outsourced projects were changing. When Outsourcing governance started the need for trusted middle men grew. These middle men would look into all the difficulties or the problems faced by the customers and the service providers. This would make the transition smooth for the different stages of outsourcing from the start (decision making) to the finish (after delivery services). These companies would search for the service providers in the market and then make the decision of placing them in the list of the service provider for different needs and physically matching the qualities of the service providers with the requirements of the customers. This was followed by the process of negotiation, the tender and the final contract. The full process is very helpful and convenient for long term and large scale initiatives since it takes lots of time and money as it is all done using man power through out.

This in turn led to the development of automated services and software tools which further brought down the cost of outsourcing a project. Companies such as pliXos developed tools which help the Service Providers and the Customers during the different stages of outsourcing and its governance.

In short the benefits of pliXos Outsourcing governance tools can be summarized under the following heads:

a. High reliability through use of standardized processes
b. Low costs by utilizing high levels of automation
c. High productivity through optimized processes

IT Outsourcing Governance Services- pliXos

The control or governance of the IT outsourcing is the decisive factor for the success of outsourcing projects. It is important to consider all stages of the outsourcing life cycle - from planning through to implementation. Due to the ever increasing pace in business and in particular in IT services being fast as well as efficient in all phase of an outsourcing initiative is important. This is further enforced by the ongoing trend towards smaller projects and shorter overall durations.

IT Outsourcing Governance Services provides this as a managed service. Using this service, standardized and optimized project management is ensured in every main step of a typical sourcing project, be it formulating a fitting sourcing strategy, supplier selection, the transition phase or the ongoing governance of the project. Based on our IT outsourcing products we can offer a cost effective solution that minimizes the effort for your internal resources.

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Picture 1: Managed Services Outsourcing

pliXos views of the research by CORE, Deloitte Inc., and Ted Rogers School of Management at Ryerson University and how pliXos managed services help in automating the full life-cycle of outsourcing project.

Key findings of the research pliXos managed services
  • Experience matters
  • Development of an Outsourcing Strategy
  • Essentials matter
  • Execution of an IT tender process
  • Empathy matters
  • Management and Governance of complex Outsourcing projects
pliXos automates the E’s of outsourcing governance
  • Experience matters in development of outsourcing strategy:

Experience doesn’t come in a day, it comes with time. Some take a month, others may take few years. It’s obvious, any organization which plans for outsourcing any project will always keep one thing in their mind i.e. what experience does the company have in dealing with the outsourced projects, and how well they have executed them. Naturally the service providers who have dealt with more number of projects will have an edge over the new ones. Analysis suggests that any new service providerwho has taken up their first outsourcing contractmay come across many hurdles or sometimes make mistakes so it is beneficial for them to take suggestions from the experienced players in the market so that they can successfully expand their hands on experience in outsourced projects.

pliXos automates these through its Marketplace and Outsourcing Advisor by answering the questions such as - Do you need assistance in developing your outsourcing strategy? Is it even worth using outsourcing? Who should I outsource my projects to? What should I outsource?

  • Essentials matter in execution of an IT tender process:

A customer before entering into a contract with a service provider would prefer to evaluate his proficiency which is related to his project which he wishes to outsource. In other words essentials are the benchmarks which the service provider should match up for easily impressing the customer. It is the optimum combination of the present capabilities and future plans of a service provider which is required by the customer. The organization outsourcing their projectshould keep his contracts flexible so that as when required they can make changes. Therefore it is advisable for the service providers to maintain well-defined and optimized essentials for a greater credibility and building good relationship with the clients.

pliXos automates these through its Tender Manager by answering the questions such as - Do you want to save costs when implementing your tenders? What should I ask the service provider? How can I simplify the complete bidding process? How do I rate the questions?

  • Empathy matters in management and governance of complex outsourcing projects:

It is rightly said “a relationship built on trust and openness can provide a better understanding of needs and priorities to both sides and help to improve the efficiency of the deal”. Trust building has become a crucial factor in outsourcing industry. By this we mean that customers should try to build a good relationship with the service providers because, this can bypass the difficulty encountered by both organizations when initiating or adapting new services and helps both sides of the deal meet their underlying needs. The sole reason behind building good relationships with the service providers is to increase the involvement of the clients with their service providers. This creates a sense of loyalty among the service providers and their customers. To quote a few- performance based incentives, awards and recognitions are becoming the focus areas of the customers to retain their suppliers. One more reason behind building relationship with the service providers is that it increases the transparency in their pricing strategies. As outsourcing projects involve different levels and fields of work transparency of pricing models are very crucial for building good relations with the customer. The service providers need to share transparency in their pricing models so that the clients have a better understanding of their investment in them. Achieving the targets on time, maintaining the desired quality of work and transparency in the pricing models are the most important points for the service providers to make long term relationships with the customers. Also sharing of long-term strategic plans will help service providers collaboratively plan their resources, tools and technologies appropriately to ensure profitability over the longer term on both the ends.

pliXos automates these through its Outsourcing Director by answering the questions such as - Do you want to ensure the structured implementation of your outsourcing project?

How do you work together with the service provider? How do you structure the projects?
What does the service provider actually do?

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Picture 2: The pliXos SaaS tools cover each phase of the sourcing lifecycle

Through the Full Set of Pre- and Post-Contract Sourcing Solutions – by pliXos (Read article) the complete process of governance is automated. The automation of governance brings down the cost and time required to complete a project.

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