IT Outsourcing – Choosing the right supplier

During the last years we’ve seen growth in demand for ITO and BPO services at the international scale. The crises brought both economic challenges and increased competitiveness across the sectors. Companies still are under the constant pressure to streamline efficiency and innovation while cut costs and derive more value.

From this perspective outsourcing appears as a liveable tool to respond to the current economic challenges and stay afloat, but still shaky economy requires businesses to take any step more cautiously, including outsourcing.

As a respond to this caution we’ve seen advisories across continents published their fit-to-all guides as to how chose the right outsourcing destination and partner. Although some of them were published for the promotional behalf of various providers we‘ve seen a change in key aspects to consider while selecting IT outsourcing choice.

Main Criteria have changed

Once not that long ago main criteria such as English language speaking skills and high numbers of unemployed locals turned into the often misguided recommendations of where to consider outsourcing and were substituted by the data safety and business continuity. Ability of both supplier and destination to provide data safety and business continuity became a key aspects of decision making process.

Evaluation Process

Some time ago the main process of evaluation revolved around the provider itself, as there wasn’t to much choice in destination options. The main aspects were:

- Company track-record and reputation
- Skills and competences
- Quality and Security
- Experience and References
- People

While making evaluation process companies should assess all that criteria and define which provider’s set of qualities fit most. Also, companies considered the human factor in each contender team, from managers to the people in the field to define the synergy and communication capabilities.

Further, with the growing popularity outsourcing seen emergence of new destinatons from exotic to socially downtrodden areas, business deal-makers from around the globe compete for a slice of the billions dollars outsourcing pie. Rise of whole new bunch of emerging outsourcing destinations have changed global outsourcing landscape and companies not being able to overlook new opportunities began to explore new outsourcing possibilities.

But investor and prospective client interest cannot longer be motivated by the provider’s assessment alone, as country legislation, infrastructure and approachability play a crucial role in outsourcing success or failure. Every company that outsources is fully exposed to the threats and hazards of the location where their operations hosted.
The terrorist attacks and corruption scandals of recent years in the offshoring industry main destination proved the importance of location assessment in decision making process.
Beyond reputations, expertise and skills of provider, one of the most critical issue became the developer’s country of origin. The knowledge of economic progress, democracy status, educational potential, etc. will let to assess potential benefits or losses of co-operation.

Industry attention

Following the suite leading analysts include not only the best location rankings into their reports and surveys, but also ranked the most unattractive and dangerous outsourcing destinations to help development and location specialists to determine the best location choice for their organization.

The location analysis became an integral part of each analysts study and report. Industry leading firms such as A.T Kearney, Black Book of Outsourcing, Gartner and Everest take annual outsourcing location rankings to analyse changes and developments in each region and update the perspective on providing outsourcing services.

Central and Eastern Outsourcing Association (CEEOA) leading regional union of IT associations commissions its annual Central and Eastern IT Outsourcing review to analyse the developments in CEE region and update perspectives of each country in providing IT outsourcing services.


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Jerry E Durant said...

It would be appropriate, before you get too deep into all of the capability of a provider, that a comprehensive viability assessment was done of the candidate providers. You might be more than capable of delivering the service but it is of little good if the company is not viable as an operating entity.