Managing Outsourcing Engagements

Course Overview

Outsourcing contract managers in both the private and public sectors face a number of significant challenges, including understanding and managing a changing business, ensuring appropriate alignment between business processes and the outsourcing contract, and handling widely varying expectations from the client and outsourcer’s organisations. As such, the outsourcing contract manager requires a refined set of business, service-level management and contract governance skills in order to effectively support the organisations needs.

Using comprehensive scenario discussions and real-life case studies facilitated by seasoned instructors, experienced contract managers will learn how to succeed in an environment where critical processes have been outsourced. Numerous examples, tools and analyses provide valuable information on what makes outsourcing contracts successful and help ensure the appropriate alignment between these complicated contracts and client business needs.

This course provides a set of practical tools and techniques designed to get you up to speed quickly on outsourcing contract issues. This is “real-life” information, directly from the trenches and facilitated by instructors who have successfully managed long-term, multi-million dollar outsourcing contracts.

Course Topics

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1. The Outsourcing Environment
   1. The sourcing landscape
   2. Varieties of “sourcing”
   3. ESI outsourcing and vendor management continuum
      • Segments
      • Details
      • Buyer side
      • Seller side
      • Full view
   4. ESI collaborative sourcing model
   5. Terminology in the outsourcing environment
   6. Why this course?
   7. Outsourcing management process framework
   8. Common issues with relationship and governance
   9. Prerequisites for relationship and governance improvement
2. Governance and Programme Office
   1. Governance model approaches
      • Organisational approach to outsourcing business relationships
      • Tactical out-tasking agreement approach
      • Business process outsourcing partnership
   2. The steering committee
      • Committee membership
      • Committee roles and responsibilities
      • Committee authority
      • Committee procedures
      • Recommended approaches
      • Common pitfalls
   3. The programme office
      • Programme office membership
      • Programme office responsibilities
      • Programme office workload management
      • Programme office procedures derivation
      • Recommended approaches
      • Common pitfalls
      • Management processes for outsourcing contracts
3. Performance Management
   1. Performance management in an outsourcing environment
   2. Operations management
      • The baseline
      • Baseline monitoring
      • Service definitions
      • Service definition examples
      • Other service definition constructs
   3. Technical metrics
   4. Process related metrics
   5. Performance monitoring
      • Reviews and status meetings
      • Analysing service level “misses”
      • Analysing performance issues
      • Addressing performance issues
        • Deriving action plans
        • Alternatives for obtaining results
   6. Service process change management
4. New Services Management
   1. Managing new service requirements
   2. Service changes due to changes in the buyer’s business
      • Workload volume changes–proposed actions
      • Service level attainment changes — proposed actions
      • Request for service level target changes— proposed actions
      • Request for service changes — proposed actions
      • Increased questions – proposed actions
   3. Approaches to add flexibility to existing contracts
   4. Considerations when negotiating a contract change
5. Financial Controls Management
   1. Managing the outsourcer payment process
      • Outsourcer payment verification
      • Payment verification—best practices
   2. Cost allocation throughout the buyer’s business
      • Cost allocation schemes
      • Fixed cost allocation
      • Usage based allocation
      • Mixed allocation
      • “Usage management” approach
   3. Tracking against the baseline business case, and subsequent revisions
   4. Tracking the contract against industry standards
   5. Careful consideration of items that may require auditing
6. Communications and Interface Management
   1. Promoting the outsourcing arrangement
      • The services status meeting
      • Collecting user perceptions
      • Reacting to user perceptions
   2. Issues versus disputes
   3. Issue management
      • Early indicators (“triggers”) for upcoming issues
      • Reacting to issue triggers
      • Data collection for issue management
   4. Disputes in outsourcing contracts
      • Avoiding disputes
      • Dispute management
      • Managing during dispute management
7. Offshore Outsourcing
   1. Typical profile of offshore outsourcing
   2. Benefits of offshore outsourcing
   3. Risks of offshore outsourcing
   4. Best practices for selection
   5. Best practices for contract management
8. Next Steps
   1. The ESI outsourcing and vendor management continuum revisited
   2. Issues faced in outsourcing
   3. Critical success factors
   4. Recommended actions
   5. Required skills