Understanding what you want to accomplish is critical to a successful outsourcing venture. Although there are many who claim to offer offshoring procurement services, the fact remains that only the business contemplating outsourcing can determine the what, who and when of any offshore service project.
To this end, a business needs to understand the WHAT of any outsourcing project. The what of course, is what will be outsourced. It's not enough to simply state we're gong to outsource IT technology services, or Human Resources, or any other facet of the business. To determine the WHAT means an intimate understanding of how your business is currently handling that work.
So the first order of business when considering outsourcing is:
Define the current Process. This should be done with an understanding of requirements. Requirements should be clearly defined in such a way as to eliminate ambiguity and offer a measurement method. Fast service is NOT a metric. Answering and resolving a specific type of customer inquiry within x number of minutes IS a requirement.
The exercise of defining the current process allows you to understand the details of what actually needs done. This information will be needed when/if transferring that process over to your new outsource partner.
Now would also be a good time to do a cost benefit analysis on the proposed process. This allows the business to have a solid estimate of the current operating costs of the process under consideration for outsourcing. When doing this analysis, be certain to honestly consider all the costs involved.
I was involved with a major technology company who insisted that any cost that couldn't readily be quantified, be marginalized or simply ignored. They based the decision to outsource their internal help desk for thousands of people based on a simple statement; "Support call costs will go from 25 dollars to 6 dollars." Problem was that they didn't cover all the costs. Although they required calls to be answered within a certain period of time, they didn't set a resolution time. When support was in house, an engineer could call for support and get a resolution in hours. After the transfer however, that same call took a minimum of 3 days and sometimes over a week for resolution. The cost in lost productivity to the company because the engineer didn't have access to his files and email were never considered in the simple statement above. If the total costs were considered, the savings would have been much less significant.
So the key tip is to know your process and costs prior to considering offshoring any project. By being armed with solid information, it's then possible to select the right outsource partner and make a good decision for the business.
A Critical Tip To Make An Outsourcing Project Successful
Basic Considerations in Buying Project Management Software
The cost range of project management software is huge. From under $50 to over $20,000. Extensive reviews have been written about all the different software packages and it is far too complex to summarize in a short article, but following are some general guidelines to help you narrow down the decision making process.
Start by determining the size of the expected project(s) and number of projects. Quite simply, the larger number and more complex projects will justify more complex and expensive software.
Small Projects
Smaller, infrequent projects often can be handled with no specialized software. Gantt charts can even be constructed with Excel. Remember though that even if your projects are small at this point, if there is a possibility that your business will grow, it may make more sense to invest the time and money in a more advanced software tool.
Suggested packages at this level include Milestones line of packages. Prices range from around $50 up to $240. Turboproject has versions under $50 up to $300. For somewhat more complex packages consider Microsoft Project at $200 to $600 or Primavera Suretrak at $400 to $600.
Medium Sized Projects
Budget becomes more of an issue as project size increases. This requires software with greater flexibility and more complex relationships. The other elements of resources, time, and scope grow substantially in medium sized projects. The previously mentioned Microsoft and Primavera packages are good choices at this level.
Large Multiple Projects
With multiple large projects resources need to be carefully allocated and prioritized. Several layers of management will be involved and the entire project management process will often need to be integrated into various departments of the organization including payroll, human relations, accounting, etc. In order to accomplish this, the project management software will need a great deal of flexibility and possibly even some customization.
Choices at this level start with the medium sized packages and go up to the highest versions of Primavera. Often network versions are used which enable multiple users contributing to the projects.
The “off the shelf”, lower end software packages can be purchased based on price alone and the internet makes it easy to locate the cheapest price. Higher end packages that may require customization are a more complicated purchase decision.
Some considerations in selecting a vendor include:
Training
Technical support
Customization consulting
Recommendations from previous customers
Stability of vendor
Cost
Your final decision on the project management software package may also involve the previous experience and skills that existing employees may have. The learning curve can be very steep, so do take this into account.
The Project Management Method – Curse or Blessing
Project management is an area of expertise that has undergone some significant development in the last decade. A business project can have a far-reaching effect on the business and result in either tremendous improvement in the businesses ability to function in the marketplace or a significant setback to that business entity.
The idea of a formalized project management approach has been around for quite some time. So it was not uncommon for any manager to find themselves learning the discipline of a structured project management system. That project methodology takes any given business or IT project through the same standardized steps from conception through implementation. Those steps would include…
* Project definition
* Needs analysis and requirements definition.
* Cost benefit analysis.
* Project scope.
* Project schedule and budget.
* Detailed specifications
* Development
* Testing
* Training
* Deployment
By utilizing a standardized process of doing all projects the same way, using the same reporting methods and tools, there is an economy of skills in that the project leaders and team members become adept at navigating these steps. Further, by using the same systems and criteria, a scale of evaluation as to the effectiveness of the system is developed so the ability of project teams to do well over time improves.
It was natural that this standardized method would become codified and finally developed into a well-developed system that could that molds all projects to a single standard. By developing an industry wide method that requires strict training and adherence to the same terms, tool sets and definitions of success, the “intuitive” nature of judging project effectiveness is reduced. And so “the Project Management Method” was developed whereby project managers can undergo strenuous and exacting training in a standardized method that would be enforced via certification across the whole of the business community.
Whether or not the PMM represents a curse or a blessing to the business world depends to a large extent on individual applications of the method and measurements and observations on whether the method itself introduces efficiency to the process of project management or just another layer of bureaucracy.
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There are some strong positives to utilizing a methodology that is standardized at an industry level. Those project managers who have gone through the certification process can be depended on to implement that system the same way in each business setting. As such, the process of finding qualified project managers becomes simplified because the certification process alone communicates to the business that it can expect the PMM system to be implemented correctly.
By putting into place an external method of certification and measurement of excellence, the project manager career begins to take a high level of professionalism similar to in the legal and medical fields. So the PMM movement represents a maturing of the IT and project management disciplines as they move toward greater levels of accountability and control.
The dangers come in implementation of the PMM methodology on a project by project basis. In order for a PMM certified manager to live by his credentials, all projects must conform to a standard mold. The unique nature of each project may not easily fit into the PMM process of systematization.
In addition, the PMM system is heavily dependent on a large amount of meetings to document that the project is adhering to standards and a methodical documentation process from which there is little room for variation or accommodation. The PMM is a complex methodology so the tool sets that must be used to track the process can be expensive and difficult to use.
The outcome is that the introduction of the PMM system can cause the actual business objectives of the project to take on a secondary priority to the high standards of PMM itself. Project leaders working under the requirements of the PMM can become more accountable to the methodology itself and lose sight of what is good for the business or what is efficient in terms of getting the project completed.
There is very little room for creativity or individual judgment within the confines of the PMM and that is problematic because the nature of business problems have historically depended on the judgment and creative problem solving skills of middle management. By dominating the project process with the needs of the PMM methodology, excessive cost is introduced as well as cumbersome requirements that do not benefit the business or the project itself.