Identify tasks and responsibilities to make governance effective

Signing a deal is often considered the exciting and rewarding part of a sourcing arrangement. However, the long-term benefit and work comes from managing/governing external relationships so that the expected value is achieved.

While, as an article I recently read noted, outsourcing in IT has brought with it the concept of governance, something that was often lacking before external sourcing, and this is considered a good thing in the senior executive suite, the focus has to be on making this governance effective.

A few posts ago, I talked about sourcing management from the perspectives of managing both the service provider and the service buyer as well as the four key domains to consider (performance, financial, contractual and relationship).

The challenge many organizations face is that while they may understand these areas and the need to manage both the buyers and the sellers, a lack of clarity of responsibilities makes effective execution difficult or impossible to achieve.

So what can you do if you're facing this challenge? A starting point is to identify 10 to 20 key tasks and ensure there is clarity of responsibilities for each area.

A common situation that I see arise in clients is that there are some areas where nobody believes they are responsible and others where multiple people believe they are responsible. Neither is helpful. In the latter case, the truth is either that someone more senior is really responsible or that they make decisions by committee.

Without addressing such issues, companies struggle with effective governance and typically look for a "scapegoat". And that is often the service provider or the contract. The result ends up being frequent contract renegotiations or frequent service provider changes.

As someone once said to me, we've been through four iterations of this, all without great success compared to our peers and the only constant is "us"--I wonder when we'll realize that we might just be contributing to some of our challenges!

• Talkback
• Print
• E-mail
• Share
• Alerts

Slashdot

Digg this

close this

Talkback 0 comments

• The 3C sourcing framework
• Cloud computing--a new paradigm?
• Lay the foundation for good pricing
• Plan for the bumps so you won't be surprised
• Identify tasks and responsibilities to make governance effective

• Would you work for an outsourcer?
• Is a giant awakening?
• Inexperienced practitioners help or hinder growth?
• What's happened to outsourcing?
• Back to basics: Why outsource?

2008

2007

2006

• Up close and personal with a merger
• Now possible to have .my without the .com
• Singapore Exchange proposes BCM rules
• A new telco in town? Maybe not
• Today's corporate landscape ain't Sesame Street

Michael Rehkopf

Michael has more than 20 years of experience in operations, strategy and sourcing covering all major parts of the globe. He has also worked for Australian, Canadian, German and Japanese companies in both business process outsourcing and IT outsourcing.
Michael's industry experience includes the financial services, manufacturing, telecommunications and travel sectors. He leverages this diverse industry experience and his university background in accounting, IT and his Master of Dispute Resolution, to assist clients in the development of business strategies and the implementation of sourcing strategies. These include the associated evaluation, negotiation and organizational change.
Michael is currently a partner at TPI, the world's oldest and largest sourcing advisory firm. Prior to joining TPI, Michael held leadership positions with Siemens Business Services, OpenPlus International, Mitsubishi Electric and Netron.