Outsourcing Case

Out of the four advantages of outsourcing listed in the book, I think the three most important are cost reduction, speed of production, and flexibility.

Cost reduction is transparent as outsourcing allows for the economical estimating of resources with little to no overhead cost. When companies do this they can obtain extra assets and capital to complete projects faster or even take on more project. Outsourcing also makes a company more flexible and able to cover more ground and gain market share not readily available without key partnerships.

Out of the four disadvantages listed, the three least important reasons are internal morale issues, potential loss of control, and coordination breakdowns.

Internal morale issues can be simply cured by preemptive communication concerning the organization's finances, company's objectives and it assessment to outsource. Potential loss of control would not be an issue if the company everyone in the organization has the same level of interest and ownership in the project. Coordination breakdown can be reduced by having members from both companies work together as much as possible.

Discuss what the term "escalate" refers to and why it is essential to project success.

Escalate means taking it to the next level for resolution if it cannot be resolved or decided at the level of the conflict or problem.

Evaluate the list of best practices in outsourcing project work to determine the single most important one that should be implemented with every outsourcing project. State your rationale.

After reading the list of best practices in outsourcing project work a couple of times, my focus kept going back to "well-established conflict management processes" as the single most important practice that should be implemented with every outsourcing project. If there is unresolved conflict, (notice I indicated unresolved as with any team formulation, there will be conflict), then the other best practices will not work. One cannot define requirements and procedures, train together, effectively review status updates, or have a long-term outsourcing relationship if there is not a process to follow when conflict arise so it does not fester.