Nature of outsourcing has changed

As a concept the outsourcing services business model is well established and a common route to service provision across vertical and horizontal markets. It has evolved to become a new, deliverable-driven discipline and a proactive approach to business process management that no longer resembles 'outsourcing' in the traditional sense of the word.

Maturity level

In terms of the ICT sector, the model has undergone many years of adaptation and has now reached a level of maturity.

Outsourcing has really been through the development mill. It was initially established as a recognised market trend, was then modified to reflect popularity in 'in-sourcing', only to be transformed back to its original form.

At present the outsource business model represents a popular route for business to engage with service providers. However, the new model has laid the foundation for a whole new level of interaction.

It is no longer accepted practice for service providers to just deploy representatives on site and complete functions/projects without any specific guaranteed outcomes. The old 'bodyshop' approach is outdated and cannot suffice.

International trends

Instead, the South African market follows the internationally established and recognised trend of soliciting the services of outsourced partners that demonstrate complete understanding of the deliverable or end result.

Service providers have to identify and remain focused exclusively on the core objective of their involvement and not merely on influences such as resources, people, time and requirements.

The service provider's role is to be an operational partner in the client's business and not a transactional vendor. The outsourced partner cannot operate with the client at arm's length - they must be incorporated and treated as a valued part of the business.

The rationale behind this trend is that there could be major costs incurred because a partner is not focused on the deliverable. It is the pinnacle of any outsource-based services contract - without it the workflow and related processes cannot be clear and manageable. The result is often more problems and issues, and so-called 'project-creeps' (a trailing service with no specific outcomes and one plagued by challenges).

Essentially a client is only prepared to make an investment on the proviso that they gain a result.

Service conscious

With this in mind, many businesses have become service-conscious and the result is the adoption of a 'co-source' type services model. This is the term used to describe a situation in which a company combines its own HR and resources with the expertise, skills and technology know-how of the outsourced partner.

The understanding is that the business then gains the benefit of the 'best of both worlds'. This can and does work in theory and practice, but there is one particularly important aspect to consider: accountability.

Which party is more responsible for the eventual outcomes? Who is ultimately accountable for the quality of services, support and deadlines? Who has to step up to the plate and take ownership of what has happened - either negatively or positively?

These are pertinent questions that will influence the success of a co-source partnership agreement.

Despite the higher levels of fluctuation and ongoing influence within this particular market space, there is every reason to believe that outsourcing will continue to develop and remain an intrinsic and valued aspect of ICT trade.