Six Biggest Mistakes in Outsourcing Contracts
August 11th, 2010
By Steve Semerdjian
While outsourcing has become commonplace in today’s business environment, the contracting process will, rightfully so, continue to challenge even the most senior outsourcing veterans. For instances, as an outsourcing customer, have you ever really looked at how much it would cost to kill a deal and back out? There are undoubtedly dozens of mistakes you and your team can make trying to make an outsourcing relationship work for the long-run. In this article, you will find the six biggest snafus to watch out for.
Do You Really Want Your Sourcing Provider to be an Adversary?
January 7th, 2010By Kirk Laughlin, Editorial Director
One of the most heated, contentious and downright uncomfortable places outsourcers and their customers frequently find themselves is on the battleground of contract negotiations. Ever been part of one of these slugfests?
More than a few smart people in this industry have observed the sheer insanity of a customer beating on the head of a service provider while blissfully lacking recognition that the drive to lower cost may well have a direct impact on the quality of service delivery back to the customer. Outsource providers may have ruled the day ten years ago during the early growth years of the industry, but the pendulum has swung the other way in recent years, explains Richard Sandler, Vice President of Contracts for CSC’s Managed Services Sector, who has global responsibility for Contracts Management of all of CSC’s commercial outsourcing accounts.
I spoke to Richard recently about how much both sides of the outsourcing relationships are identifying innovation as a key goal on the roadmap toward a sustainable, fulfilling engagement. Sandler says that the “procurement mentality” still reigns in many customer organizations, pointing out that this approach can be quite damaging in the services sector where high value strategic contributions and mindshare are, in the end, what the end customer or business unit is really looking for. “The only way they can relate to procurement is to beat down on the vendors,” says Sandler. “For suppliers like us, we have a global infrastructure. It behooves both companies to work in a non-adversarial way.”
