Is outsourcing a toxic term?

That was one of many pertinent questions asked during a thought-provoking event last night organised by the Global Sourcing Association UK.

CEO Kerry Hallard kicked off the session, hosted by Eversheds Sutherland, by arguing that the industry is far too often a scapegoat and needs to change. She described the current position of the outsourcing industry as “a burning platform” warning that the collapse of Carillion, the Labour Party’s anti-outsourcing rhetoric combined with plummeting service provider satisfaction and constant negative headlines in the press as all damaging the sector. “The collapse of Carillion was a governance issue, not an outsourcing issue, but it’s bringing lots of negative headlines about outsourcing more generally.” How can we change she said, revealing a member survey which showed that 81% of GSA members felt that change in the outsourcing sector was essential for survival.

The main problem in outsourcing is the silence of the buyers, argued Chris Day from Atos, a GSA council member. Buyers are not keen to promote what they’re outsourcing partners are doing. “This is a conspiracy of silence. If you leave a blank space, the gap is filled by negativity.” He acknowledged that while people often didn’t want to talk about outsourcing, there was no reason to feel awkward about the topic. Ask yourselves:

  • Is the customer experience better than it would be if the service was delivered in-house?
  • Are the benefits to shareholders in line with predictions?
  • Is the service provider perceived as a good, local employer?
  • Is the service compliant?

If the answer to those questions is ‘yes’ then there’s every reason to celebrate the relationship’s success, he said. Promoting the value of outsourcing was a key topic of debate in one of the break-out sessions which followed.  Everyone wanted buyers standing next to their outsourced providers and promoting what a great job they were doing for the core business. But there was agreement that this was unlikely in the majority of cases.

My breakout group of around 10 agreed that changing the way messages are phrased would help. Rather than hiding the fact that an organisation is outsourcing, or making excuses for it, they should argue ‘we care about x service so much that we ask the experts to do it for us.’ Others agreed. “You don’t call it outsourcing when you hire a solicitor or an accountant. Or you go to the hairdresser. You call it using an expert.”

But one detractor in the group argued that the industry is over-reacting and that changing the public and press’s mindset about outsourcing was not going to happen. “We need to focus on the cause of the failure and the negative perceptions and get better at delivering great outsourcing projects. Then there will be less negativity.” At the end of the event, the GSA announced that it is launching research to demonstrate the benefits of outsourcing. The question is whether the sector can get the press – and wider UK Plc – to listen.

By Cathy Hayward

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Ben Keeley