Outsourcing Governance

In recent years many companies have decided that they are going to concentrate on their core business. They have identified business needs that can be delivered more efficiently by a third party, looked around for an expert in that particular area and given them the contract, essentially saying “just get on with it”. This has worked well in some cases, but how do you know you are getting what you are paying for?

You need a relationship between the client and the supplier where the client knows they are getting the service they asked for and that their supplier is developing their systems in line with the client’s future requirements. Traditionally, the only information the client gets is what the supplier tells them which fails because there is no independent assessment and there is no collaborative environment for decision making concerning the future direction of the service.

What is needed is a more effective relationship between supplier and customer. It is not just about the actual service. We at MooD International have come up with a way of examining the performance of an outsourcing contract or large scale business programme so it is clear how it is contributing to the way an organisation works.

The MooD solution straddles the line between the client and the supplier. At the outset of a project, MooD helps define the scale and scope of a project and then continues to assist so that the client gets the business insight it needs. From the client side, MooD work often starts before the outsourcer is chosen, clarifying the supply chain, highlighting the implications of possible changes and judging how they will affect business outcomes.

Outsourcers are currently facing the issue that trust over the last ten years has been eroded; the mega-contracts of the last century no longer exist. Enlightened suppliers need to build an environment that starts fostering that trust again and one way that they will achieve that is by providing reliable insight into contract performance for the client.

What MooD technology does is to provide the means to join different aspects of the contract together – all the people running the service, the people responsible for delivering the service, the physical aspects that underpin the service – and so allow both the client and the supplier to understand the connections and hence jointly address risks, issues and opportunities to their mutual advantage.

Other systems may be providing lots of data on a technical level – the supply chain, finance, HR. The bit that is missing is the understanding of the relationships between the components and the implications for the achievement of the business outcomes. MooD technology defines the business model in terms of key cost & performance drivers. That business model is synchronised with key data sources transforming decision making. Once interpreted, the results are then visualised in dashboards that the business users can interrogate and understand how the project is progressing day-by-day so that they always have a clear idea of whether they are achieving the desired outcomes for the business.