We believe in outsourcing when it is done as a strategic means of focusing the organization on what strategically is the core business. This will lead to better results in itself, and if the outsourcing is done correct, it will also lead to lower cost for the necessary but non-core outsourced activity. This activity is the core business of someone else, who will be able to do it better at lower cost, and who will also improve it over time.
Very few organizations today believe that providing lunch to the employees in the canteen is a core activity – why it is outsourced. If it is done right, the lunch will both be better and cheaper. This is not always the case.
When working with outsourcing, we follow the principles of Vested Outsourcing® (Kate Vitasek, The University of Tennessee - see the VESTEDWAY website to learn more about Vested).
The most fundamental paradox the team around this model found in their research work, was that the owner in almost every studied case dictated to the supplier exactly how to perform the outsourced activity. And then based payment on performed activity. A focus on desired outcomes is more fruitful, and allows reward to be based on performance against agreed KPI’s.
RRR Consulting can together with the client establish a strategic roadmap for outsourcing one or more activities, direct design, lead and manage the whole outsourcing process, evaluate existing outsourcing arrangements, or assist with other needs in this area.