Europe is in turmoil after Great Britain’s vote to leave the European Union. Those who now claim to know what will happen now – in outsourcing or in other areas – will make two big mistakes: First, they will show that they don’t understand what Brexit is. Brexit is, to use the words of author Nassim Nicholas Taleb, a “black swan”: an unexpected event with largely unforeseeable consequences, just like 9/11 or the Lehman Brothers bankruptcy filing. Second, they will simply be wrong.
Business services are usually at the core of organisational endeavours, structured to build and manage a variety of workflows and dependencies in a concerted manner. The end goal for all such services is the smooth functioning of an organisation, built around some strategic goals usually manifested in revenues, growth, competitiveness and shareholder value. Over the course of more than two centuries, industrial advancements – enabled through scientific and technological innovations – have assisted with building and sustaining complex workflows, products and services.
IT reaches far and wide within organisations, particularly in the case of large enterprises, but it can be difficult to understand exactly what it does and how it is having an impact, especially when it comes to measuring return on investment. Enter Technology Business Management (TBM).
Simply, TBM provides an end-to-end view of the delivery of IT, capturing how both resource and cost are being consumed by the business. This facilitates more informed conversations around IT spend and helps demonstrate IT’s strategic value to the rest of the business.
The result of the EU referendum will undoubtedly have a profound and long-lasting impact on the entire UK population and is likely to be something that is truly generational. Whether we voted for Remain or for Leave, however, Brits now have to assess where we are and how we maintain our position in the global economy.
More and more facilities and IT organisations are outsourcing their services. They may have a lot to gain; for example, outsourcing these services can lead to leaner organisations less bogged down by technical pursuits. Unfortunately, outsourcing does not always improve efficiency, and when done badly can have a negative effect on services. The following are two examples that help explain how IT and facilities organisations handle outsourcing, and what this can mean…
Outsourcing services gone wrong
Data and analytics are fundamentally redefining applications today. In our daily lives, we use technology to help us make virtually every decision. And when you look at consumer applications—the Amazons, Netflixes, and Facebooks of the world—they’re all centred on data. You might not think of them as analytics applications that serve up a wealth of data to inform decisions, because the information is wrapped up in really slick user experiences. But in fact, they provide analytics information to you where you need it most.
Maybe Daniel Decatur Emmett will forgive me for “borrowing” some lyrics from his iconic 1850s American folk song, ‘Dixie’. I do this to encourage British business to look further afield for IT outsourcing services, as encouraged by Brexit. The USA and its domestic or onshoring companies represent a great but seldom considered alternative.
Outsource: Joe, thank you very much for joining Outsource today. We always begin interviews by asking for a little bit of an introduction to yourself and your organisation for our readers – so, over to you…
Joe Musacchio: I am the CEO of PeopleTicker. PeopleTicker is a rate and benchmarking tool, we cover salary and contingent labour benchmarking. We basically help companies that want to know how much somebody costs, for projects, individuals, recruitment, sourcing, and procurement.
I can recall being on vacation in Hong Kong with my wife as we were walking through the famous shopping district in Mongkok. Here you can buy Class A imitation goods of leading brands at far lower prices than the real brand and few would ever know the difference. Or, if you are like me, you will negotiate (aka: haggle) for an even better price. As I plied my finely honed negotiating skills on the unsuspecting merchants, the price kept getting lower and lower. My wife would say, “Stop, stop already” and she would eventually walk away in embarrassment.
Sourcing executives today are all about innovation and adding business value: buying smarter to drive business benefits such as increased customer satisfaction, reduced error rates and insights into product design. In other words, procurement operational strategy aspires to demonstrate alignment with factors driving the success of the business, which is more than just cost takeout.
Who could argue with that?