Page 297 - Global Project Management Handbook

14-22 MANAGEMENT OF GLOBAL PROGRAMS AND PROJECTS

because the outcome of an outsourcing project relies heavily on the contract structure and
its implementation. If the contracts are made with good standards, outsourcing can be a
win-win situation for both the outsourcing company and the vendor. Moreover, communi-
cation and detailed documentation add to the probability of success by ensuring an effec-
tive transition period. During the transition period, the first step is the transfer of intellectual
capital from the client’s organization to the outsourcing firm. Ideally, this process should
be done one-on-one. Effective personnel communication and the development of an
atmosphere of trust are also key elements in the success of the project.
An outsourcing project does not end when the operation transfer is completed. A fre-
quent failure is to discontinue the assessment of the outsourcing decision once the
process is on track. An outsourcing relationship is exposed to every economic, political,
and sociologic alteration in the global environment. Key performance indicators must be
monitored on a continuous basis to avoid the hidden costs. Periodic feedback from both
the internal employees and participating customers is useful to review the success of the
outsourcing relationship.
Outsourcing is an important decision that determines a company’s operations and
strategies. The outsourcing decision and execution constitute an extensive project that
affects the major strategies of a company. Today, a growing number of U.S. companies
move to the outsourcing model either to remain competitive or to maintain their existence
in the market. A dangerous rationale is to decide and execute an outsourcing initiative
without a long term vision. Thorough analyses of all factors should be performed by a
systematic approach within a project management framework. The goals can be achieved
only if all project phases are accomplished successfully.

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