Business Focus – Outsourcing – What’s it all About?

IT requirements are becoming more and more complex, and, as they do so, computer consumers (or businesses) are able to put together packages for their needs based on services they have provided for them or to them in a variety of ways. This is known as outsourcing, and, currently, the trend is for it to be outsourced to another country – which then becomes ‘Offshoring’.

You may already be involved in an outsourcing agreement, if you support a company’s IT infrastructure. You are the supplier, and their system support is outsourced to you. However, this practice is only going to become more as the needs of the business community become more diverse, and, using economies of scale, ‘Offshorers’ become better and better at providing a cheap, effective, well run services. The natural reaction for anyone, when faced with outsourcing can be ‘surely they couldn’t do it as well as me’ or ‘I am familiar with the needs of the business, I’m flexible and I’m here’, however, if you aren’t dynamic, visionary and very good at letting your customers know your value, you may be faced, at some point in the future, with being outmoded yourself and replaced by a remote tech support centre in Bangalore. At the moment (Feb 2007), IBM employ 53,000 employees in Bangalore, equivalent to one in six of its workforce.

So – what to do? You can ignore this and pretend it’s not going to affect you, and as a freelancer, depending on your customer base and the size of the businesses you support, it may not for a while. Or, you can take the bull by the horns and do something about it.

What can you do? Follow the list below to take the tiger by the tail and make sure you’re in the know in preparation for the Offshore exodus, and able to benefit from it and in fact use it to your advantage.

Find out as much as you can about the industry and about the size and type of companies currently offshoring or outsourcing their support/programming/etc. Where does your business fit in this model, are you at immediate risk? It’s unlikely you are, at this point, unless your freelance business supports large or medium large organizations remotely.

Make a list of similarities between the companies using offshore or outsource support, and use this to inform your planning. If it’s companies like your customers, but bigger, get ready to have to take some proactive steps to make sure you are in the winners enclosure when your customers re-look at their support.

Items on the hotlist for help when dealing with outsourced or offshore work are – governance (agreed overseeing of the arrangement and strategic planning), monitoring of service, managing of service level agreements (what the outsource company will do, and by when, along with what the supported company should do, and by when), residual face to face training, ongoing diagnostic support (have you ever seen a scared user on the phone to Dell/IBM trying to work out if the network cable/plug/electricity is switched on???) and even project management of new projects or new outsource agreements.

Or, go and buy your ticket to India because that’s where a lot of the jobs are going to be!