Comments on: Offshore Outsourcing Vendors, Customers, and Advisors: They Should Know Better http://360vendormanagement.com/2009/11/16/offshore-outsourcing-vendors-customers-and-advisors-they-should-know-better/ Best Practices in Outsourcing and Vendor Management Thu, 05 May 2011 13:47:00 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Joe http://360vendormanagement.com/2009/11/16/offshore-outsourcing-vendors-customers-and-advisors-they-should-know-better/comment-page-1/#comment-1177 Joe Mon, 15 Nov 2010 22:56:43 +0000 http://360vendormanagement.com/?p=251#comment-1177 The issue isn't so much one around outsourcing as it is the specific outsourcing model. The traditional method of riffing a bunch of employees and then bringing in lower cost less qualified employees is simply flawed - period. A better approach would be to keep the employees and move them to the outsourcer and the outsourcer through efficiencies gained by using cloud computing models, agile development, and other shared resources is able to consume ony 80% or even less of those employees time and to leverage them onto other projects. Benefits (1) the client doesn't lose the unique and inherent knowledge of the IT staff, (2) the client gets a level of service equal to or better than they currently receive, (3) the IT staff get to keep their jobs, and (4) the IT staff get the opportunitiy to expand their skill set by working on other projects which increases job satisifaction and employee retention and opportunities. This is a much more effective model and allows companies to keep jobs in the USA - which we all need right now and which frankly the State of Texas should have done. I'm not surprised that IBM and many of the other major outsourcers are not leveragin this model - they don't really understand the real definition of cloud computing - they think it is nothing more than hosting existing stale software. Companies like Salesforce and only a few limited others have figured out how to deliver a true cloud platform model. The best combination is a true cloud platform + an outsourcer that knows how to retain and more efficiently leverage IT staff across multiple projects. The issue isn’t so much one around outsourcing as it is the specific outsourcing model. The traditional method of riffing a bunch of employees and then bringing in lower cost less qualified employees is simply flawed – period. A better approach would be to keep the employees and move them to the outsourcer and the outsourcer through efficiencies gained by using cloud computing models, agile development, and other shared resources is able to consume ony 80% or even less of those employees time and to leverage them onto other projects. Benefits (1) the client doesn’t lose the unique and inherent knowledge of the IT staff, (2) the client gets a level of service equal to or better than they currently receive, (3) the IT staff get to keep their jobs, and (4) the IT staff get the opportunitiy to expand their skill set by working on other projects which increases job satisifaction and employee retention and opportunities.

This is a much more effective model and allows companies to keep jobs in the USA – which we all need right now and which frankly the State of Texas should have done. I’m not surprised that IBM and many of the other major outsourcers are not leveragin this model – they don’t really understand the real definition of cloud computing – they think it is nothing more than hosting existing stale software. Companies like Salesforce and only a few limited others have figured out how to deliver a true cloud platform model. The best combination is a true cloud platform + an outsourcer that knows how to retain and more efficiently leverage IT staff across multiple projects.

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