Outsourcing: the economic recovery’s unsung hero
Outsourcing The City and Tech City are billed as the headline-grabbing heavyweights of the economic recovery and there is currently much debate about which will drive the greater long term growth and job creation.
Toiling away behind the scenes, adding significant value to both these ‘sexier’ sectors is the perennially unsung outsourcing industry, the true great enabler of economic recovery. Without outsourcing, economic recovery would be a vague twinkle in George Osborne’s eye - because companies no longer outsource just to save money, they now outsource to grow and improve.
In 2014, the savviest CEOs know that engaging with appropriate strategic partners is the quickest, safest route to shake things up and get their noses in front of the competition. If there is one option in the CEO’s strategic playbook that will unabashedly get right to the heart of the issues in your business, unleashing a torrent of commercially-aware creativity to sustainably optimise and future-proof everything it touches, it’s outsourcing.
You want game-changing disruptive technologies and cutting-edge process innovation? Access to world-class extraordinary talent? An efficiency drive to generate funds to chase new revenue streams? Better quality whilst reducing costs? And all at once? All these are sterling reasons to buy services, rather than bear the risk of CAPEX. Outsourcing is the new normal, largely because it is imprudent to waste time and effort on developing capabilities in the ‘wrong’ areas. It’s much better to outsource your non-core work and focus on sharpening your competitive advantage in your ‘real’ business.
Outsourcing may never be sexy, but it is smart. Just make sure you do it right. Commit to buying outcomes, not SLAs. Keep the right skills buy-side to manage things properly, so you don’t become a dreaded ‘outsourcing failure.’ Whilst the youthful hipsterpreneurs of Tech City bask in positive news coverage, outsourcing gets a tough rap in the media (even though much of the work in Tech City is done for clients, and thus, technically, outsourcing). This is down to an innate need to create heroes and villains. Quietly delivering solid results does not a headline make, so most people are largely unaware of how prevalent and as well as beneficial outsourcing is.
No-one talks about how the outsourcing industry is the second biggest aggregate employer in the UK, and is a major behind-the-scenes player in keeping the top employer, the retail industry, efficient, competitive and open-for-business. By its very nature, outsourcing sees other industries take the credit for its best successes. But make no mistake, whatever you’re outsourcing, engaging and aligning suppliers is a niche skill in itself; you’d be wise to brush up on the latest models and governance techniques if you intend to maximise the added-value over the long term.
I hope you enjoy this supplement, which is full of the latest thinking on how to get value from your outsourcing.