Flat World ? 

"Flat world" - It is a popular word in the business world today.

Ever since Thomas Friedman's book on globalization "The world is flat : A Brief History of the Twenty-First Century" made into best seller the expression is used liberally in many areas of the business community. Friedman derives his title from the expression "a flat playing field," denoting a competitive environment where both teams compete on equal terms.

What does it mean to your organization ? This is the focus of our strategic consulting practice.

Blindly taking a leap of faith that outsourcing will bring success to the organization is simply wrong. There have been many instances where outsourcing has led to major losses for organizations. Therefore, any company that is looking into outsourcing must plan and consult a lot before actually outsourcing their services.

This requires your organization to carefully plan and analyze its long term objectives and decide which processes to outsource, why to outsource, when to outsource, where to outsource, the relative costs involved, the long term benefits, political stability of the outsourcing destination and lots more. Only after deciding on these issues should the company outsource its services.

To ensure that the outsourcing would be a wise decision following strategic points should be given due consideration:

1. Understanding the Needs and Objectives of the Organization

Before actually planning to outsource a company must be sure of its long term goals and objectives. Based on these objectives, a company needs to decide what kind of outsourcing contracts to go for. We often recommend organizations to identify areas using methodologies such as Siz Sigma or Lean. The results from such methodologies can be of great help to foucs on the areas to be outsourced.

2. Identifying the offshore outsourcing destination

In offshore outsourcing the destination country plays the most important role. Before finalizing the destination a company has to make sure that the destination country has a stable government, good infrastructure and skilled labor.

3. Identifying and selecting the vendors

Suppliers/Vendors are players who provide outsourcing services. The suppliers strengths, services he offers, existing customers, infrastructure and certifications are some things that need to be taken into consideration.

4. Signing the contract

The outsourcing contract should be comprehensive one with the mention of all necessary clauses. There should be a SLA (Service Level Agreement) also.
Make sure the terms of service are flexible and expandable to newer levels. Licenses and other warranties should be signed with the contract

5. Establishing a communication channel

Communication plays a major role in deciding the success or failure of an outsourcing project. So make sure to establish clear communication to the supplier about your specific needs and expectations

6. Measuring the ROI

Measuring the ROI (return on investment) is the most important step in deciding the actual success or failure of the outsourcing project. Hence regular measurement of ROI is very important.