How to walk the fine line of IT Outsourcing

The trend of IT outsourcing is still going up, even though labor cost of India is increasing and margin of Infosys is shrinking. IT outsourcing is normally driven by in-house IT department with the claim of cost-cutting, standardization and scalability. IT department will in turn mainly focus on service management and client partnering. I do see the benefits of IT outsourcing; however, I just want to share some concerns totally from personal experiences perspective.

How to walk well in such a fine line?

About people

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In the professional word, emotion is always a sensitive topic in the never-ending voices of “We need professional people to do professional things.”

Service is never purely about solving issue or supporting system operation; service is to support employee’s work and it’s always people-oriented. The deep-rooted judgement of service is always subjective. Yes, the booming of internet technology has provided us with multiple ways of communication. However, there is no other way that can replace the powerful connection of face-to-face communication, the magic trust we feel when we see other people’s eyes.  In absence of connection and trust, we tend to complain and finger-point confronted with surprises, issues, and challenges.

About complexity

A lot of MNCs have multiple IT service providers with a bigger and bigger portion of cake for them. Two questions are coming out that how to manage them and how to make them work with each other well. One approach is to create many in-house check points which means new roles like

  • Demand manager
  • Service delivery manager
  • Design authority
  • Change management
  • In-house consultant

Service providers, therefore, must have their counterpart to handle their clients. The interesting result is always complex service processes. For employee of vendors, they have to go to too many people to get approval or buy-in; for employees of the clients, they can never figure out whom they should turn to for help. It’s a nightmare for whoever needs to use IT system and whoever needs to do the operational system support work.

Another approach is to have proper reporting with agreed KPI to monitor the service like

  • How many incidents are raised
  • How many incidents are solved not within SLA

My question here is what the purpose is of IT service:

  • Is it to check if the wrap-up box is still nice but with moldy strawberry?
  • Or the purpose of service is just to help business growth:
    • Which area has noises
    • Which area needs intervention
    • What has been improved

Then again, if clients need more insight about operational issues, we have to add complexity to the process so that every issue will be correctly categorized. Would it add another layer’s complexity to the service processes?

If nobody is happy with the “complex” and “stupid” system as well as the “never-ending” email chain to solve a single incident which can easily be solved with 2-minute talking, transforming business with information innovation is just like an illusion. It may help explain why so many sales teams by-pass IT department to use CRM of salesforce.com or BI of Quikview rather than SAP, the standard but outsourced platform.

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