1. by Eric Fimbel and Jean-Claude de Véra
How to Succeed in
Outsourcing International
Operations?
The question is on many minds today. What are the key factors to successful outsourcing? How does an
international context affect these factors? This article is based on the results of Eric Fimbel's research and on
Jean-Claude De Véra's professional experience, which should help senior management make the right
decisions and develop successful partnerships.
0 utsourcing is a mul-tifaceted issue, pro-
viding economists with a fascinating sphere
of analysis situated within the general scope
of "make or buy" activities. An entrepre-
neur has more to do than just decide
to outsource. He also has to turn
these decisions into successful man-
agerial implementation in order to
generate the expected return on
investment.
This article presents the
results of a specific research focusing
on outsourcing success factors and
especially on the following question:
Does the internationalisation of activi-
ties have an impact on certain identified
key success factors? If it does, to what
extent?
Studying successful operations To
answer these questions, 94 outsourc-ing
operations conducted by European
companies have been studied.
These operations were regarded as
successful by both the management of
the company that decided to outsource
its activities and the service provider
who is now managing these out-
sourced activities.
Each operation has been
analysed using 800 elementary criteria
dealing with the different aspects and
stages of the outsourcing operations
carried out. Among them, the number of
countries in which the company was set
up has been highlighted. For the interest
of this analysis we will look at
companies located in more than 10
countries (35 outsourcing operations)
and at companies exclusively national
(40 outsourcing operations).
Pinpointing key success factors For
these 94 outsourcing operations, we
surveyed 22 key success factors
COMPANY AND OUTSOURCING PROFILES
1 site
Numbersofsitesconcernedby
outsourcingoperation
2 to 9 sites 10 to 99 sites > 100 sites
21% 20% 48%% of companies studied 21%
Turnover 15 to 150 M€ 150 to 1,500 M€ > 1,500 M€
% of companies studied 23% 19% 58%
The Business Link • Spring 2005 29

2. Figure 1. SURVEY OF 94 OUTSOURCING OPERATIONS: % OF POSITIVE ANSWERS OBTAINED FOR EACH
OF THE 22 IDENTIFIED AND TESTED SUCCESS FACTORS. (© Eric Fimbel)
Key Success Factors for Outsourcing
Positive answers
1 country >10 countries
01 Provider's understanding of customer's motivation and objectives 75% 83%
02 Provider's understanding of customer's economic environment (context,
sector)
30% 54%
03 Customer's accurate definition of the contents
of the outsourcing deal before signature
63% 51%
04 Quality of the contract's legal terms and conditions 15% 34%
05 Exhaustiveness of the contract (ail causes of conflict are anticipated, etc.) 33% 26%
06 Use of a maximum number of standard components 35% 17%
07 Realism of customer's targets (i.e. achievable) 43% 69%
08 Previous mastering with internai resources of the outsourced perimeter 48% 29%
09 Anticipation of the social impact of outsourcing operations 70% 77%
10 Customer's management of the provider (coordination, control, etc.) 23% 80%
11 Consumer target group ownership of the outsourced services. 38% 69%
12 Efficiency of project management (implementation and transfer) 55% 91%
13 Relations between the outsourced activities
and the customer's customer's organisation
45% 34%
14 Provider's technical abilities and skills 63% 51%
15 Customer's organizational abilities 63% 54%
16 Technological avant-gardism of chosen solutions 0% 0%
17 Proven reliability of the technologies that are used 25% 34%
18 Pressure caused by external demand with short-term delivery dates 10% 17%
19 Financial strength of the provider 38% 20%
20 Previous references from the provider 35% 46%
21 Customer's high level of technical ability 48% 26%
22 Real cooperation between players rather
than a strict customer/provider relationship
73% 91%
have been identified and tested (see
Figure 1). Three of these factors proved
essential to every outsourcing scenario.
First, the service provider must under-
stand the customer company's motiva-
tion and objectives. This factor is an
essential managerial lever, no matter
the number of countries the company is
involved in. Similarly, managers need to
anticipate the social impact the out-
sourcing operations will have. And final-
ly, management and service provider
both point out the need for a partner-
ship that goes beyond a simple cus-
tomer/service provider relationship.
It is interesting to note that
success factors linked to legal condi-
tions and to technologies are rated
low on the scale of importance.
Comparing international and
national companies
If we transpose the results we found for
each of the 22 key success factors onto
a graph (see Figure 2), the difference
between international and national
companies becomes evident. First of ail,
we notice that higher values (?80%) are
only present among international
companies, meaning that key success
factor mobilization greater in an interna-
tional environment. Secondly, for inter-
national companies, 11 factors get
results superior to 50%, whereas for the
The Business Link • Spring 2005 29

4. Figure 4: SUMMARY OF THE MAJOR OUTSOURCING KEY SUCCESS FACTORS FOR NATIONAL OR INTERNATIONAL
OPERATIONS (0 Eric FIMBEL)
IS Outsourcing : Cartography of key success factors according to the international dimension
of the operation: 1 country (horizontal axis) or no less than 10 countries (vertical axis)
No less than 10 countries are concerned
1 0 0 %
9 0 %
8 0 %
7 0 %
6 0 %
5 0 %
4 0 %
3 0 %
2 0 %
1 0 %
0 %
appropriate human and economic
exposure. Similarly, one has to monitor
the transition and progress, and
demonstrate willingness to build long-term
relationships beyond contractual
terms and conditions. ■
dt.aEric Fimbel is professor of business
administration at Reims Management
School. With a doctorate in business
administration, he is qualified to monitor
scientific research as part of several labo-
ratories (CNAM and INT) and has already
published research relating to outsourcing or
information technologies. He is the sci-entific
advisor of EOA (European Outsourcing
Association. (eric.fimbel@reims-ms.fr)
Jean-ClaudeDeVérais
chairmanofBIPORIS,aman-
agementconsultingcompany
specialisedin shared services
and outsourcing operations from diagnos-tic
to implementationand optimisation.He is
involved in professionalnetworks such as
Shared Servicesand OutsourcingNetwork,
EOA, Corbett Associatesor FD / HR / IT /
and FM Associations.(jean-
claude.devera@wanadoo.fr)
I M
I . P r o j e c t
m a n a g e m e n t
M a n a g e m e n t P r o v i d e r
b y C u s t o m e r
Appropriated services by end-users
Realistic goals from Customer
Partnershlpattitudes
Soc al understanding
Socialadvance
External constraints
Controlled perimeters and contents
Customer / managerial skills Provider
I technical skills
F i e l d M M M
u n i i n c l l i g
Contractit_andtestedInfernal/means
Compati Interfaces
Interfacesexternat
Mutual
Technologies
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Only one country's concerned
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The Business Link • Spring 2005 29