The Third Wave Of Outsourcing: Process Improvement Article

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The Third Wave of Outsourcing: Process Improvement

Companies have taken length of time in acknowledging the challenges after realizing that the old ways of managing infrastructure won't get them where they need to go.

Author: Bharat Jain

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Companies have taken length of time in acknowledging the challenges after realizing that the old ways of managing infrastructure won't get them where they need to go. Their infrastructure is best left to the third-parties as they often come to the conclusion ultimately. Over the years, there have been three essential waves of IT infrastructure

outsourcing:
-Cost-driven outsourcing
-Competency-driven outsourcing
-Predictive and process-driven outsourcing

The first wave was chiefly to do with the cost. This wave covers payroll and transaction processing comes in back office operating process. Companies have grasped the understanding that they could reduce back-office operating costs by turning to service providers who could arrange their own infrastructure.

The second wave has taken place in the early 1990s at the apex of re-engineering. It was concerned with making of greatest use of the core capabilities or competencies. The outsourcing options available to them continue to require labor-intensive and relatively unproductive solutions. While resumes were often scrutinized, little heed was paid to introducing new, more productive approaches to infrastructure management.

The third wave was actually formed in the late 1990s. There was a shift towards predictive and proactive infrastructure management in areas such as network support, messaging and help desk management. The newest areas that are being targeted for this kind of approach are security and database administration. As the operational demands of enterprise IT infrastructure increases, gains associated with low-cost labor in the short-run can't be
maintained over time.

The moot question is whether companies will attempt to continue to deal with these infrastructure challenges on their own or whether they will make a move to specialized service providers. The prior waves of outsourcing were based on asset shifting or global labor arbitrage, whereas third wave players base their businesses on systematized processes and IT automation.

One national retailer turned towards its financial fortunes which had let the company to work on very thin margins and to better manage its data assets.

Another large Midwestern research hospital has developed a service-oriented architecture to unite both clinical and research sides of the enterprise. IT infrastructure comes together at the point of patient care to enable hospital to securely manage their huge amounts of patient data and provide higher levels of service.

If companies are looking forward for these benefits of infrastructure outsourcing, they must seek to partners which will not only address the concerns of cost and core competency, but process automation and improvement as well.

About Author

ITMatchOnline.com , an outsourcing hub where provider and buyer exchange their needs. Looking to outsource projects or services? Visit ITMatchOnline.com http://www.itmatchonline.com

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The Third Wave of Outsourcing: Process Improvement