Outsourcing programs have become fairly common nowadays. The IT sector is among one of the largest industries to outsource. Companies started outsourcing primarily to cut costs. But today, it is also about accessing skilled expertise, reducing overheads, increasing efficiency, flexible staffing, reducing turnaround time and eventually making the business more profitable.

The goal is to hand over the IT systems to an “expert” who has the tools and methodologies to ensure uninterrupted service to business at a lower cost.

Outsourcing has its fair share of strong supporters and opponents making it a controversial topic. Regardless of the business benefits, every company has some concerns when they think about outsourcing their Business/IT systems.

Outsourcing Concerns

There are two major outsourcing concerns, among others, that companies have :

  1. Will the level of service be maintained to ensure that the business is not impacted?
  2. How can we track the changes happening to our assets?

The first point is addressed satisfactorily by most vendors as they have robust Transition Methodologies honed by years of implementation. At its core, it involves working with the customer’s SMEs and gathering the knowledge of the systems, doing a few weeks of shadowing the customer teams and then a few weeks of reverse shadowing where the customer takes a backseat. This process ensures that customer confidence is built progressively and the transition is smooth. And then there are various reports, check points and other processes to ensure that nothing falls through the cracks during the transition phase. Customers invariably do a thorough due-diligence of the transition and steady-state processes before they hand over the operations.

The second point is slightly delicate and assumes importance only when the performance of the outsourced vendor is not satisfactory. Or in certain cases, when the customer leadership decides that they want the vendors to be changed/consolidated. In these cases, two things can happen. The customer does a reverse transition and takes the outsourced work back from the vendor. Or, the existing vendor has to transition the knowledge/assets to a new vendor. In either case, it becomes important to know what has changed since the systems were handed over to the vendor?

Tracking Changes to Assets

Changes can be across multiple fronts – source code, documents, process, new assets getting added etc. It is imperative to have a system that tracks the changes to the assets in an outsourcing program. Analytics built around these changes help track the modifications to the customer’s IP assets – what has changed, when it was changed, who has changed and so on. This would be extremely helpful when the customer wants to take back the outsourced program from the vendors. The capability to know what exactly is happening to the assets that have been outsourced, can bring a sense of control to the companies that are outsourcing.

Tracking the changes to assets can have other benefits as well. For example, the knowledge transfer sessions can be more focussed. Through the analytics, if we know that in the last 24 months, only 30% of the artifacts have changed, when newer members join the team, the knowledge transfer sessions can focus only on those items rather than covering the entire asset library. Having the asset traceability can also help in arriving at innovative outcome-based pricing models in outsourcing programs.

Are there any tools out there that help in tracking the changes happening to the outsourced assets? Are customers and vendors leveraging those tools? Would be happy to hear from you on this.

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