Innovation in Outsourcing & Reserach

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Session 37 at the Nearshore Executive Alliance Board Meeting. Innovation in Outsourcing & Reserach by HfS Research Ltd

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Innovation in Outsourcing & Reserach

  1. 1. …yet, to date, organizations have receivedmodest results from outsourcing initiatives… Source: HfS Research and the London School of Economics Outsourcing Unit, 2011 Sample: 347 Buyers of Outsourcing Services
  2. 2. Governance exhibits rarely drive innovation…. Governance exhibits are often little more than management committees, escalation procedures, and meeting schedules. “My contracts’ governance exhibits are the lynchpin of the subset of governance processes that evolve services to match our strategic objectives.” (N=56) 40% 38% 30% 29% 23% 20% 10% 7% 4% 0% Strongly Agree Agree Neutral Disagree Strongly Disagree
  3. 3. …and contract incentives cannot drive innovation,either. Contract incentives rarely sufficient to drive evolution or innovation: »Most focus on transaction efficiency goals »Few allow for automatic changes to increase established goals “My contracts’ economic incentives are sufficient to drive an evolution of services to match our strategic objectives.” (N=48) 40% 35% 30% 25% 21% 20% 13% 10% 6% 0% Strongly Agree Agree Neutral Disagree Strongly Disagree Source: HfS Research, 2011
  4. 4. Buyers say they want innovation, but they really wantto drive efficiency and cost reduction… Source: HfS Research and the London School of Economics Outsourcing Unit, 2011 Sample: 347 Buyers of Outsourcing Services
  5. 5. Organizations need to establish anenvironment that promotes innovation. Common, Open Business Shift in Value Shift in Pricing Plan Willingness to Evaluate New Forum to Discuss Strategic Commitment to Making Technology and Processes Direction Decisions Timing Dedication of Resources Willingness to Take Risks

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