The Undocumented Benefits of IT Outsourcing

The ink has dried on the new contract with your provider and you are starting to see some significant transition and transformation activities occurring within your organization. 

As you roll out the new agreement to your business counterparts and your IT organization, your communication materials are chocked full of statements like “reduced cost,” “improved delivery,” “world-class service,”and so on. But, while these are significant components of the business case for making the transition, there are other benefits of working with a top-tier service provider that may not be obvious just yet. 

However, knowing these “undocumented benefits” can pay important dividends over the upcoming years if you recognize them and apply dedicated focus towards realizing them.

Process Improvement

There is no doubt your vendor has plans to introduce new tools and processes in order to achieve the price points and service levels to which they committed to throughout  the negotiation cycle.  While many of these may be internally focused, they can still provide an excellent catalyst for improving processes across your retained IT staff and in some cases all the way out to your business and end-users.

To take full advantage of your provider’s ability to improve processes, you need to understand the specific goals your provider is trying to accomplish,  then ask them to propose how your processes could/should be changed to better align to what they are trying to do. 

Of course, some of their ideas may not make business sense, but there are probably plenty of “improvement opportunities” in the areas of request management, project management, review and approval cycles, etc. that make perfect sense to pursue. 

Let the Provider do as much of the process engineering work as they will (or can) – you can then supplement as necessary to ensure any changes make the most sense from your perspective.  And since you are probably now getting performance metrics that you didn’t have before, you have a mechanism to monitor the performance of IT and identify future areas for improvement as well.

Thought Leadership

While the term “Thought Leadership” may have been part of the sales process, there were probably few concrete examples of how it would specifically work for you.  However, you will have plenty of opportunity to press your provider to present strategies and industry insight not only for IT-centric topics but in many cases to tap into their overall industry knowledge that can complement what you already know about your competitors and your consumers.

For example, say you want to develop a strategy for making applications and data readily accessible via mobile devices.  You can tap into your provider’s resources to get specific technical subject-matter expertise, and you could also find out how other companies have addressed the same business needs within your industry. 

In a broader context, your provider can be very helpful as you develop future strategies and their supporting programs and initiatives.  Leverage your provider’s insights and thought leadership in order to establish a solid future vision and provide budget numbers, timing, and risks associated with each program.

Industry Networking

Your provider can open additional doors to IT forums and conferences, and can help you meet others in your industry. You can do some of this on your own, but having a provider of sufficient size and scale in the IT industry can prove to be a very useful benefit.  Assuming they do a good job for you, they will also at some point want you to be a reference for them, thus encouraging further dialog and relationships that can be of benefit to you.

Better Business Focus

To achieve this benefit, you must be prepared to truly let your provider “lead” their service delivery responsibilities from the beginning of the process (receiving an approved request) to the end (implementing, or obtaining approval to implement). 

You and your retained leadership team must make a conscious effort not to spend time looking over their shoulder questioning exactly how they get the work done.  By allowing the service delivery work be managed in “black-box” fashion, you will find that  your team will have more time to align IT services to true business needs.

Perhaps the simplest way to restate this concept is that you determine “what” needs to be done “by when,” and allow your provider to determine “how” it will get done.  This allows your provider to feel a true sense of accountability for their part of the process, while you and your team spend time integrating yourselves with the business.

There are many benefits to working with a top-tier service provider. Some are blatant like cost reduction and improved delivery, while others are more subtle like, industry networking and process improvement. But recognizing and applying dedicated focus towards realizing some of the more subtle benefits can pay important dividends over the upcoming years.


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