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guidance only. If the two top scores are very close or very similar, then
they should be examined more closely to make a more-informed decision.
Once a vendor is selected, the organization needs to make sure that a
fair and reasonable contract, beneficial to the organization, is negotiated.
It is imperative that the organization clearly define service levels and the
consequences of not meeting them. Both parties should make sure that
they understand the performance measurement criteria.
Phase 3: Implementation and Management
The final phase in the outsourcing decision process is the implementation.
During this phase, a clear definition of the task needs to be identified,
and establishing a time frame would be very helpful. Mechanisms need to
be established to monitor and evaluate performance during the vendor's
developmental process. This is important, even after implementations, to
make sure that the outsourced tasks are being delivered by the vendor
as they are supposed to be delivered. The ability to identify, communi-
cate, and resolve issues promptly and fairly will help the company achieve
mutual benefits and make a relationship successful.
Depending on the size of the outsourcing contract, the manager respon-
sible for the program's delivery and integration may be responsible for all
of the process or only some. These are the horizontal and vertical fac-
tors of outsourcing management. A manager of the horizontal process is
often involved in the decision to outsource, and is then responsible for
defining the work, selecting and engaging the vendor, and managing the
delivery and completion of the program. This manager normally handles
all day-to-day negotiations. With larger programs, particularly those on a
global scale, there is often a decision taken at senior levels to outsource. A
negotiation team is appointed to work through the complex agreements,
usually under strict confidentiality, until the agreement is finalized and
announced. It is then the role of the manager of the vertical component
to implement and manage the ongoing program. Part of this role is the
interpretation of the agreement and identification of areas not covered by
the agreement.
Procurement Planning
Procurement planning, which encompasses the outsourcing decision,
should be every bit as rigorous as project planning. Once you've made a
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