This document discusses common issues that arise in IT outsourcing projects from the perspective of a CIO. It outlines 7 key decision areas that could cause projects to go awry if not properly addressed: 1) identifying business drivers, 2) defining scope, strategy and delivery model, 3) issuing clear RFPs, 4) selecting providers based on capabilities, 5) negotiating complete contracts, 6) smooth transitions, and 7) establishing cooperative governance. The document stresses that decisions in each area cumulatively impact success, so all stages require adequate guidance to achieve intended benefits.

1. Alfredo Saad
IT Sourcing Consultant
https://br.linkedin.com/in/alfredosaad

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• Do you live this scenario?
• Previous evidences
• Decision areas and their potential mistakes
• Conclusions
• Additional references

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 Do the C-level executives of your organization live a
latent feeling of frustration with the results of their IT
outsourcing project?
 You, as the organization’s CIO, to whom was assigned 3
years ago the responsibility of leading the project and,
later on, of managing the outsourcing contract have
been hearing one or more of the following questions?

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 “Where is the promised 20% IT
budget reduction?”
 “Shouldn’t our provider be proposing
us new and innovative IT solutions to
support our business operations?”
 “Why our end-users perceive a
worsening trend in the outsourced
services quality?”
 “Why our provider shows a mere
reactive attitude and, yet worse, with
slow and inefficient actions?”
 “Why our provider shows such a deep
ignorance about the critical and
priority factors of our business
concerning the outsourced services?”

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 Such questions are more and more frequently heard in
an explicit or veiled way and tend to consolidate the
widespread perception, inside the organization, that the
outsourcing project has been conducted in an inept way.

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 The cases of success and failure of such projects teach
us a great lesson:
The quality (or the lack of it) of the decisions
taken along the project steps shows (for the
good and for the evil) a cumulative effect that
afterwards determines the achievement or not of
the intended benefits.

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 The main decision areas which could have caused the
misstep of our hypothetical CIO are highlighted in the
next slides:

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1. Have the strategic, tactical and operational business
drivers, which supported the outsourcing decision,
been correctly identified?

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2. Were the scope of services, the deployment strategy
and the delivery model defined consistently with the
business drivers?

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3. Was the approach to the outsourcing market made
adequately with an RFP that clearly stated the
requirements of the buyer organization without any
ambiguities?

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4. Was the provider(s) selection process coherent with the
final objectives to be achieved through a balanced
evaluation of all factors involved (financial, technical,
operational, etc)?

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5. After selecting the provider(s), did the contract
negotiation discussions prioritize all critical aspects that
would enable the effective achievement of the results
that would support the business drivers initially defined?

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6. After signing the contract, was services transition
deployed safely and smoothly concerning all human and
technical resources transferred?

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7. After transition completion, did the day-to-day
operations aggregate a solid governance process that
motivated a cooperative attitude of both parties, making
it viable the emergence of innovative solutions along the
contract lifetime?

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 It should be noted that the
previous questions constitute
a chain of causes and
effects, whose rupture, at
any stage, will impact the
general effectiveness of the
project.
 In other words, only the
adequate guidance during all
stages will make it viable a
virtuous cumulative effect
that will result in an
unquestionable project
success.

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Additional References
 In future posts, we will discuss in a detailed manner,
each of the 7 questions shown
 On the next slide, you can see some previous
presentations which discuss additional aspects of the
subject:
 All of them were published here at

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Additional References
 Crisis in IT outsourcing contracts: how to solve it
... and what you should have done earlier?
 How important are the HR teams in an IT
outsourcing project?
 Bad News on IT Outsourcing Risks: If Not
Treated, Their Effects are Cumulative
 IT Outsourcing Contracts: Heaven or Hell? You
Choose
 IT Outsourcing Contracts: Relationship between
Parties