EquaTerra, mid-term, BPO

Mid-term Outsourcing Blues: The Causes and The Cure

Mid-term Outsourcing Blues: The Causes and The Cure

by: Ian Swanson, Senior Consultant, EquaTerra

Introduction
At EquaTerra, one of our most frequent client requests can be summarised simply: “We outsourced two/three/four years ago, we managed to get through the transition, but now service is stale and we spend all our time arguing instead of working constructively to improve our business. What can we do?”

There is an equivalent supplier version: “We’ve delivered on transformation, we meet all our service commitments, but we get no recognition; the perception of our service is poor and we just keep being beaten-up on price and lack of innovation. In fact, we are getting pushed further and further from the business issues we expected to be trying to help with.”

This situation is so common and so recognisable, because it is a direct consequence of how the conventional outsourcing business model is applied in practice. Left unchecked, the relationship will deteriorate to sullen mutual tolerance, threaten failure to renew, or at worst, early contract termination. Often, a client’s internal IT spend rises as staff are hired to cover for a poor performing supplier. Study after study shows significant levels of disappointment with service providers.

However, by understanding the underlying causes, it is possible, through good governance, to anticipate the deterioration and put in place preventative measures. More often, the situation needs to be fixed. This paper contains an analysis of why the “mid-term blues” are so frequent, how to make the changes to recover the situation, and what needs to be done to prevent a re-occurrence.

Click here to download the complete white paper.