February 4, 2004
7:30 to 10:00 AM
Temple University Main Campus
There is no technology topic that is currently more visible to the collective communities of technologists, business executives and even the general public than the subject of Outsourcing. From its origin as a management efficiency practice for controlling IT costs and focusing upon core competencies, Outsourcing has ventured far beyond its original technology boundaries. The practice of Outsourcing now has economic, competitive and even political implications. Outsourcing has reached the point of being not only a component of a company’s technology strategy but in many cases their business strategy. But is the growing practice of outsourcing technology functions and the execution of specific business practices a viable long term strategy?
- Larry Dignan, News Editor, Baseline
- Bruce Hillier, Partner, Global PeopleSoft AMS, IBM
- Michael Palmer, Allied Office Supplies, Inc., CIO & EVP Supply Chain Management
- Niraj Patel, Executive VP & CIO, GMAC Commercial Mortgage
- Rajiv Tandon, SVP Banking, Financial Services, and Automotive, Syntel
- Bill Siegle, CIO, ACE INA Holdings, Inc.
The Panel primarily focused upon three major components of the topic of Outsourcing. These were the long term viability of Outsourcing, the critical success factors in its implementation and career and developmental considerations for students.
Outsourcing is first and foremost a business response to fundamental and competitive factors. Such opportunities as expense reduction, efficiency improvements, organic business growth, response to acquisitions and skill improvement are quite simply driven by the economic reality of globalization. The business practice of Outsourcing has no geographic or political constraints. Outsourcing will in fact penetrate more deeply into the value chain of a company, having been initiated as a technology practice but now growing rapidly into areas of business process.
The implementation of Outsourcing requires considerable skill and focus beyond conventional projects. Aspects of onshore, nearshore and offshore Outsourcing were discussed. While greater opportunity for expense reduction occurs with the practice of offshoring, there is also a greater degree of risk. Successful Outsourcing practices must include:
- Substantial change in processes to leverage the new business model
- Keen awareness of cultural impacts upon doing business
- Complete and thorough documentation of processes being changed
- Honest and open communication to employees
From a student perspective there were a number of observations:
- Recognize that Outsourcing is a reality and do not restrict yourself to one specialized area of expertise
- Always focus upon what value you bring to your employer and constantly upgrade your skills
- Know your employer’s business, not just the technology you individually support
- Smaller companies, in particular, may be driven to Outsourcing and this provides opportunity for an employee to understand multiple components of a business.