Staffing issues a key factor in outsourcing deals

The fate of staff following a move to outsourcing was recently tackled by the panel of experts discussing the factors that can make outsourcing deals go sour at the latest EDGE breakfast series event produced by the IT Business Group.

The University Health Network, one of Canada’s teaching hospitals,

has been outsourcing for 10 years and gone through three major contracts with providers like HP and Digital Equipment.

Cara Flemming, director of risk management and controller, has struck a deal with outsourcing vendors that they seek permission before hiring the hospital’s staff. “”You don’t want surprises,”” she said.

Even if IT workers of a client company begin working for the outsourcer assuming control of certain projects, the advantage is they have “”already developed these relationships and speak the same language,”” making it unnecessary that they all sit beside one another, said Michael Taylor, director of outsourcing client solutions at RBC global services in Toronto.

Some clients redeploy staff to where their skills can most benefit the company, he said.

Union buy-in

For Hydro One Inc., CIO Hitesh Seth found it best to seek an agreement from the union on sensitive matters related to staff movement when the Toronto-based utility outsourced IT and business processes two years ago to Cap Gemini in a 10-year contract.

Union talks culminated in the decision that Hydro One staff shifting to Cap Gemini “”enjoy career growth”” such as gaining experience working with multiple clients that was not possible through their original

employer, Seth said. He added it was agreed critical staff were to handle the Hydro One account for a certain length of time.

Over the course of the contract, Hydro One staff have been pulled from strategic functions — such as dealing with outages and desktop calls — and begun overseeing Cap Gemini as it directly handled these activities, a move that Seth described as “”a little bit of a challenge and a mind shift.””

Failed outsourcing deals are a result of unrealistic expectations, poor communication and difficulties getting the client company and vendor to work together, said Geraldine Fox, global outsourcing practice leader at Compass Management Consultants in Mississauga, Ont. Many firms farm out pieces of their business they are unable to achieve much success with themselves, Fox said. In no time, though, these clients realize these troubled projects cannot be managed “”from a distance.””

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Jim Love, Chief Content Officer, IT World Canada

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