Social Aspect to Outsource Success

The Birmingham Post (England), June 20, 2006 | Go to article overview

Social Aspect to Outsource Success


More than a third of major outsourcing deals that include redeployment or a transfer of personnel run into problems because organisations are failing to understand the importance of the "social" factor, according to a new study from IT services giant LogicaCMG.

The social factor takes into account internal communications, redeployment within the IT department, the transfer of personnel to the service providers and the provision of a clear roadmap for staff about the future of their employment.

The survey looked at the attitudes of 200 senior decision-makers in large firms in France, the UK and Germany towards success factors in outsourcing and the issues that led to termination or non-renewal of deals.

It found that the two main selection criteria when choosing a service provider remain price and technical skills.

But trust and the ability of service providers to communicate effectively with employees are becoming increasingly important.

Andrew de Cleyn, senior vice-president, global service delivery at LogicaCMG, said: "The social aspects of outsourcing arrangements, particularly employee communications, must be approached with care.

"At a European level more than one third of contracts that included redeployment or a transfer of personnel ran into problems because of lack of preparation.

"For 15 per cent of the companies surveyed, the result was termination or cancellation of the project.

"This can have major consequences for a company that has already taken some steps towards outsourcing. …

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