Outsourcing – Relationships and Issues

    October 30, 2006

Many folks cringe when we start talking about the experiences that we have with outsourcing anything from the company.

Some folks swear that outsourcing was the best thing that happened to them. My take on it is what is the skill of the outsourcing company in comparison to the skill set already in house? That will help define what the experience of the outsourcing is going to be like. My additional take on this is that the relationships between internal and external advocates be acknowledged, and maintained to the best outcome possible. Not realizing the multiple issues beyond the actual work with an outsourcing contract can help lead the entire process into failure.

If the company has a very high level of skill, any appearance of low skill set on the part of the outsourcing company will be derided. For example, if you have some good web hackers and web application hacking teams, and the outsourcing company forgets or omits the basics, then that is room to make an opinion of the outsourcing company. Most people when they are debugging web apps will put up a local proxy so that they can see the transactions going across, if the outsourcing company is having problems and does not turn over the proxy report that starts the process of finding fault. Once the finding fault process is well underway, people start to ask more and more questions. They will hold the outsourcing company under and increasingly tight microscope and any little fault will then be viewed in the greater context of they are not doing this right. If the outsourcing company starts looking disorganized in comparison to the company, or not ready to go as the company is, then the outsourcing company is going to have to pull a very large rabbit out of their hat to recover their reputation.

This is particularly hardest to swallow when internal personnel reputation or the outsourcing company came highly recommended from internal sources. The people who recommended the company will see that their reputation is also mixed up with the company that is doing the work. Since this is a trust issue, if the project goes south or the work is not completed to company standards, the outsourcing company looses their internal advocate, which makes it harder for the outsourcer to get any additional contracts with the company.

If the company has a low level of skill in relationship to the company that let the contract, then any work that the outsourcing company does will be held in a good light. It will be because the company that let the contract will not know any better. They will not know if steps were missed, nor will they know if the work was completed accurately. The relationship here is easy for the outsourcing company to win additional contracts until someone really starts to question the output, or the skill level at the company who let the contract improves.

Given both scenarios, outsourcing can be difficult to accomplish. There is usually an understated trust issue between both companies that complicates the relationship. The relationship is also based on skill sets held in both the outsourcing company and the company that is doing the work. To have a successful outsourcing experience then the skill set between both companies should be similar, and the trust relationship should be acknowledged. As well, there are social and political reputation issues on both sides of the contract that should be managed as well to ensure that the outsourcing process is successful for both companies.



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Dan Morrill has been in the information security field for 18 years, both
civilian and military, and is currently working on his Doctor of Management.
Dan shares his insights on the important security issues of today through
his blog, Managing
Intellectual Property & IT Security
, and is an active participant in the
ITtoolbox blogging community.