Some time ago, I have seen an article that suggested possible reasons why outsourcing projects fail. Among other things mentioned in the article, the following statement looks very important:

So why do so many IT outsourcing projects fail to deliver the benefits that companies want?

Perhaps companies need to realise that just because a service is outsourced, it doesn't mean a company can forget everything about it the relationship has to be managed and modified if the environment changes. If you outsource a problem you don't get rid of it If you just have to manage it at slightly longer range, which can mean a problem worsened.

Cost shouldn't be the only motivation behind outsourcing especially if it is a service that is vital to your organisation. Would you want your supplier scrimping and cutting corners to make a margin because you've screwed the contract down tight? It might be attractive at first, but what if this means your service levels start to degrade?

But perhaps the important thing to do is understand your needs before you start and then explain it to your supplier. And understand what your suppliers can really deliver.

The idea of understanding what the chosen suppliers can really deliver deserves more attention, and in a bit different key as well. For many companies looking for outsourcing solutions, the cost reduction remains the main decision-making factor. But the lowest price does not guarantee the best solution to your outsourcing problem.

While there are many companies offering their services as outcourcing vendors, their level differs. Some may be experienced companies with a portfolio of many successful projects, while many others would be one-day wonders with not much to offer except for the attractive price tag. An intelligent manager looking for an outsourcing partner will look deeper behind that price tag and try to find out the real value of the company offering an outsourcing solution.