Outsourcing - Part II

As we shift from motivation to implementation, our case discussions were focused upon who gets to make the decision, how to choose a vendor, and how the outsourcing relationship is managed. What do you think of the following..

• As a business manager, how much do you want to be involved in the outsourcing decision? Do you want the decision rights or just input rights?
• Which is better - best of breed or single sourcing?  What has been your experience with outsourcing?
• What do you think are the challenges in managing vendors (or clients)?

What stands out for you in outsourcing now that you have a chance to reflect some more?

Motivations for Outsourcing

The topic of the class over the next few weeks will be outsourcing.  We start today by talking about motivation - Cathay was outsourcing to drive down costs and Cisco was outsourcing to spur innovation.  From your experiences, what reasons have you seen for rationale for outsourcing in your company?  And in the news, what outsourcing deals have you seen announced and what was their rationale?

Even close to home, some recent analysis has suggested that one reason for the BP oil spill was due to the outsourcing relationships (scroll to the bottom of this article).

And all of this leads us to ask - where do organizational boundaries end?  And what does it mean for a company to geaux virtual?