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7 April, 2006
OUTSOURCING GROWS UP
Written in early 2005 by two partners of the McKinsey’s London office, this article shows that the ICEM views on contract and agency labour are beginning to be accepted by influential Management Consultants.
According to the article, the main objective of the first companies using outsourcing, was purely to reduce costs. That has changed somewhat. It is now generally accepted that companies also use contract and agency labour to improve their operational performance.
The authors’ research shows that, in spite of this change, few companies changed the way they make their deals. They also say that that “up to 50% of outsourcing arrangements fail to deliver the expected value”.
Examples are given of companies experiencing severe problems during the operation of the contract, due to the fact that they did not have a clear strategy at the beginning of the process. Towards the end, the article argues to work with all the internal stakeholders that will be affected by the move, including union representatives.
The article can be found here:
http://www.mckinseyquarterly.com/
article_page.aspx?ar=1582&L2=1&L3=106