Once you’ve identified an IT outsourcing provider, defined transition and transformation elements, established a governance structure, and signed on the dotted line, it’s easy to feel your work in the process is done. You may think it’s time to pass everything to the outsourcing team and let them take it away. In reality, your role is just beginning. Your next step as chief information officer (CIO) is to effectively manage provider transitions to ensure smooth and seamless workflows for all teams. Here are three important aspects that must be managed to effectively transition your IT outsourcing.
Manage the relationships
Whether you’re transitioning from a current outsourcing provider to a new one or from an in-house team to an outsourcing provider, you must effectively manage all relationships involved in the transition. This is often the most neglected area of outsourcing transitions, but it’s foundational for success.
The first thing to consider is how to best manage and use your existing resources both during and after the transition. For example, if you are downsizing an internal team due to outsourcing, consider how long you want to retain internal staff. Rather than letting go of your existing team immediately, leverage employees for institutional knowledge and a less risky transition. The rebadging of critical employees can be a powerful mechanism for bridging the knowledge gap.
You’ll also want to manage expectations and relationships with non-IT stakeholders. Set business expectations and communicate the expected benefits and risks clearly from the outset. By doing so, you provide non-IT stakeholders with a clear vision of what to expect and will strengthen IT’s partnership within the business.
Pay close attention to the overall relationship between your company and your outsourcing partner. Because this relationship exists between two teams, it’s often invisible and doesn’t receive the attention it requires. Establish good communication practices early. Designating key in-house experts to aid the transition will help. Be sure to take advantage of your new provider’s transition expertise as well.
Manage the scope
During the transition process, the scope of the project must be managed carefully. Too many businesses get off to a rocky start with outsourcing partnerships because they attempt to do everything at once, dumping their entire process and systems on their provider without an effective transition plan. Instead, “many CIOs have benefited from adopting a more flexible scope when managing complex outsourcing transitions, specifically in the IT applications environment.”
To avoid this mistake, consider these three strategies for managing scope during the transition phase:
- Be flexible and prioritize effectively. As you transition, avoid trying to do too much at the outset. Be flexible and give everyone time to ramp up and increase efficiencies, much as you would with a new employee. Instead, prioritize effectively and concentrate on the biggest needs first.
- Consider transitioning in phases. Understand what is mission critical and transition this in the first phase. Designate later phases for other projects.
- Separate transition projects from transformation projects. Transition open projects and mission-critical projects first, leaving innovation and transformation for later in the partnership. By separating these two areas, you reduce risk and improve your chances for success.
Manage the processes
Finally, CIOs must manage the tactical process of the transition. An effective transition plan incorporates the people involved, communication processes, scope, projects, transition timelines, goals, and customer/business needs.
As you develop this transition plan, establish working practices to facilitate effective communication as well as key metrics to measure growth and results. Shared KPIs can be designed to assess the processes and workflows of current projects, ongoing maintenance, and future innovation, allowing you to determine the success of your partnership. Having these measures in place from the beginning will help you tackle underperforming aspects of your partnership and evaluate your contract effectively when it comes time to renew.
As part of the transition, clearly establish ownership of various IT processes. Eventually, your outsourcing partner will have governance over many things previously owned by someone else, but your internal team must manage the overall processes and execution of the transition.
For expert assistance managing and transitioning your IT service delivery model, connect with Windsor Group. Ask about Windsor Group’s industry unique engagement model.