With business competition increasing, organizations have turned to third parties for delivery models that offer new ways of fulfilling their information processing and data needs. Managing an IT service is very different from managing IT products and requires new skills. Contract establishment, vendor management and education of the business staff is needed. This paper addresses some of the key areas to consider when contracting for large-scale IT service contracts.
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Like all complicated issues, outsourcing has valid pros and cons. There is no universal right answer or way, only tradeoffs that must be weighed and balanced in context to an organization’s own needs and circumstances.
The healthcare industry has been relatively late to adopt outsourcing. However, there has been an ample push from prominent healthcare stakeholders to delegate the non-core processes to third-party service providers and focus on core competencies. The reason to outsource is not a luxury anymore, but more of a compelling need.
Contractors and consultants may be a necessary part of your project team, but you cannot manage their work in the same manner you manage employees--or even matrixed resources.
As the divergence between different types of project managers continues, there will be additional trends developing that seek to take advantage of the changing project landscape. It’s one of those emerging trends we look at here—the idea that project management, or at least some project management, can become an outsourced function.
For many corporations, outsourcing has become business as usual, a key way to reduce costs and increase flexibility. While many debate regulation and controls, outsourcing presents an opportunity for project managers primed to seize it.
By taking an honest look at some real-world pros of cheaper raw development costs and the cons of increased communication and collaboration time, we can make smarter decisions around when and where to use it.
When decisions are taken to outsource project execution elements, there is one consideration that needs to be given more weight. Organizations who outsource often allow valuable knowledge to leave at the end of the outsourcing relationship, hurting their ability to deliver in the future.
Project management becomes so much more complicated when contracts get involved. If nothing else, it seems to cause so many more project managers (or people who call themselves project managers) to pop out of the woodwork. This should be a good thing, but it can also be an unhelpful complication.
For more than 20 years, the idea of outsourcing work to low-cost countries has been the project manager’s go-to option for extra resources. That’s no longer so. We now need to make more complex resourcing decisions that may ultimately give PMs greater flexibility.