By virtue of what can only have been a “few spare chairs”, I found myself at the inaugural IT Leaders Forum a couple of weeks ago at the Imperial War Museum and spent a part of my afternoon chewing the fat in the company of many of the C-level execs from the IT departments of a veritable “who’s who” of  blue-chip globals. I enjoyed the event a great deal but at one point during the afternoon I got a little irate.

Just like a group of lads in the pub will invariably end up talking about football; get a bunch of CIO/CTOs in the room and they’ll, at some point, get around to talking about outsourcing. As it happened, it was during the first part of the programme, a panel debate. Somebody in the audience asked what members of the panel thought of outsourcing and all of the members of the panel reeled off an interesting, sometimes insightful, list of anecdotes. I will share with you the two that, in my opinion, lacked insight.

The first was Darrell Stein, CIO of Marks & Spencer. His experience was that he found he “had to send a really great project manager over there[sic] to sit on them” in order to achieve a positive outcome. The second was Catherine Doran, Director of Corporate Development at Network Rail. Catherine’s experience was that the cost benefit of outsourcing was substantially reduced by virtue of the fact that the work output of “one of them” is substantially less than you might get from someone “over here”. If you can’t see why this wound me up, stop reading.

Schein (1988) in his work on  Organisational Culture and Leadership, said that we can make an assessment of organisational culture based on a number of things, including the language used in an organisation. Here we have the Leaders of the IT Leaders Forum using language like “sit on them” and “one of them” and I don’t think it too unfair to assert that these “visible products” of culture (by Schein’s definition) infer that there is a generally negative perception of outsourcing in big business.

I can hear you saying “no s**t Sherlock”, and I agree. That there is a negative perception of outsourcing amongst many IT leader is not news. What I did realise is that, despite my question to the panel on the subject, these leaders couldn’t really explain why they think that’s the case. I can.

Whether you have a team of 2 or 200, it doesn’t matter where they are, Birmingham or Bangalore, if you don’t manage them, they will fail. Whatever their location, cultural background, native language or any other variable, the team need to be respected and treated as professionals. As IT managers, we must invest substantially in bringing the team on board and getting up to speed with the processes, products and expectations of the company they are working with/for. This applies equally to an in-sourced or outsourced team. Without doubt, it takes much more management effort to instill the values and beliefs of an organisation in an outsourced team than it does if they are in-sourced but that’s because they are not there to see and feel the artifacts of culture like an in-sourced team are (Schein ibid.).

The mistake that many IT organisations that outsource make is to fall into the trap of believing that an outsourced team doesn’t require as much mangement as a domestic team. One of the great business benefits of outsourcing is that it reduces your people management headaches, surely? In fact the opposite is true. Furthermore, managing an outsourced team when your Leader espouses the cultural values of the purchasing organisation by using language like “sit on them” and “over there”, is going to be a challenge.

When you outsource, it puts your skills as a manager to the test. If you can’t manage a team in your own office, you sure as hell can’t manage a team 5000 miles away who may not even be employed by you. Any decent manager could manage an outsourced team but we’ve go to be aware that it will involve a considerable investment of time, just as much, if not more, than would be involved in on-boarding a team in the domestic office. Approach an outsourced project with that in mind and you won’t go far wrong. Approach an outsourced project expecting that the team will just “get on with it” at your, and your project’s, peril.

P.S. As for another argument I heard at the IT Leaders Forum that went something like “you can’t outsource the ‘clever stuff’ (architecture)” – what drivel. India invented Chess, Dentistry, Fibre Optics, the USB….oh and the binary and decimal number systems (amongst hundreds of other inventions/discoveries). Last time I checked they had clever people in India too, and if you’re a decent manager, you’ll find them.

P.P.S. I enjoyed the IT leaders forum a great deal and, for the most part, was particularly impressed by Darrell Stein. I enjoyed his general approach, inisight and the levity (with a serious subtext) that he brought to the gathering. Not sure they’ll invite me back though…

References:

Schein, E. H. 1988.Organizational Culture and Leadership. San Francisco: Jossey-Bass.