Since last three decades, the
outsourcing field has grown from nothing into a multi-trillion dollar field all over the world. Thus, ISO would have to expand its involvement in order to cover the numerous ways that the process is being implemented. The financial rewards, economies of scale, flexibility and increased productivity promised by sourcing would be a hot commodity in the coming years, as the skyrocketing rates of outsourcing affect every sector of society.
It is a good business strategy as it enhances efficiency, speeds up the production process, cut costs and enables firms to focus on their core tasks. However, to a lot of people, it is a frightening proposition. Yet, the new business model that has been adopted all over the world cross private and public sectors, offers numerous benefits. It allows a company to achieve its objectives, tap into resource base, add value and mitigate risks. Focuses at the beginning on highly transactional back-office processes or non-critical offerings, now sourcing encompasses strategic functionalities, with several firms off-loading whole segments of the value chain.
To this day, it exponentially spreads all over the globe; issues that have not come into existence would inevitably arise. The job of ISO's is to monitor trends and development and make standardizes solutions to help find a way around or over obstacles that hinder their path. It is a good company strategy and with the help of the new
ISO standard, the future certainly looks bright and of course the industry remains a booming field. The process has its detractors, in truth however, there is little evidence to suggest that the market is doing anything other than booming.
These days, a wiser and more mature market has emerged. Organizations and businesses no longer consider cost at the main driver behind the deals. More and more firms are seeing it as a way for adding value to the firm and gaining additional technology and domain expertise as well. Through employing a supplier with high standard level for developing complex technology which transforms re-engineers a key function, end users aim to change the operation for performance improvement and decrease in cost. When approached from a transformational perspective, the economic pros are a beneficial result instead of being an objective. The main aim is accelerating and financing the transformation. This is geared around company requirements like strengthening front line operations, closing the skills, accelerating marketing speed and major technology demands like making a flexible and strong infrastructure. The transformational model implies another level of the relationship between vendor and end user. It's more of a partnership wherein a provider could demonstrate flair in pro-activity, domain expertise, thought leadership and the ability to adapt and respond to the organization needs of end users.
With the growth of transformational outsourcing comes the realization among users that it isn't a matter of just handing over a problem to a supplier. The strategy is different; it is effecting continuous strategic change then tying the results to strategic outcomes for a firm. It's a collaborative, risk-and-gain relationship of the enterprise and its providers for driving enterprise transformation and to achieve significant process enhancements. Through harnessing the process, and working in tandem with the supplier towards similar goals, the new outsourcing model could have a significant effect of achieving company goals and requirements.
There are both big benefits as well as possible pitfalls when sourcing such development to a third party vendor. On the positive side, the promise of substantial, rapid, sustainable improvement in organization-level performance and improvement on the bottom line as well has enticed users to take into consideration the transformation method. Nonetheless, it is essential to follow the best practices when it comes to considering the solution. Just like in any outsourcing deal, finding the right supplier is paramount. The difference in the model is that the supplier must be absolutely trusted to know the business of the client, the systems used and the processes and operations that would be transformed. The domain-level expertise should be one step ahead of the traditional method due to the fact that core procedures are being transformed, instead of amended or just being managed.
One other concern that should be considered carefully with the method is the need for users and suppliers to view the relationship as a business model, which benefits both parties and not just a deal. It is very important that the strategic goal must be kept at the center all the time. The advantages of this kind of sourcing will come about as a result of intelligent processes. When it is put into place, monetary benefits are inevitable. However, it is the enhanced value to the organization and processes that's the most significant benefit to customers.
Diversification in transferring a task to a third party vendor became a rallying cry to widen corporate bases and benefit from the economies of scale. For a lot of huge firms, this resulted in a strategy of focusing on core competencies, determining what is vital to the future growth of the firm and what is not. Practitioners of outsourcing were looking for a common vocabulary across all industry facets, which include typical concepts, to enhance the understanding of all stakeholders that are involved in managing the life cycle of the methodology.
This led ultimately to the publication and drafting of ISO 37500:2014, whose authors were experienced practitioners who are involved in deals all throughout the globe. Great measures were taken to ascertain the standard provided an industry-independent and generic foundation, so in future it may be supplemented and tailored to suit industry-centric requirements. All sides of the industry were invited to join in the writing of the standard. While the document is much sector-agnostic and addresses independently of the size of the company, the experiences gathered by experts from an array of industries, like IT enables services and manufacturing were highly valuable when putting the standard together. Focused initially on highly transactional back-office processes, it now encompasses strategic functions, with some firms off-loading the whole segments of the value chain.
