Does outsourcing or offshoring one or more business processes equal to automatic business transformation? Unquestionably, emphatically, no.
To put this question in context, as a part of any plan to transform nonstrategic processes, outsourcing or offshoring can be exceptionally effective in reducing the ultimate cost of goods and services, increasing customer satisfaction or improving the quality of delivery. As a “business life event,” offshoring and outsourcing allow for a new point of view, an opportunity to discard old ways of working, the ability to change a cast of characters, and destroy the webs of outdated routine.
However, outsourcing or offshoring a problem without implementing change management does not by its nature change the way corporations manage or participate in business processes; rather, it serves to magnify problems and issues. They are simply “change-enablement” tools.
Transformation success — or failure — is incumbent on how these tools are implemented with an explicit focus on change management: The leadership of change, approach to change, the pace of change and compliance with the change. Unrelenting focus on these all-critical change-management issues will enable an outsourcing or offshoring initiative to take a corporation “beyond the curve.”
Leadership of Change
Any business transformation is risky and disruptive. By adding partners and/or different locations, the complexity of achieving transformational change is compounded. As a result, the right kind of leadership is critical to enforce corporate resolve.
While the tenets of transformational leadership have been fully discussed, the key leadership lessons are relatively simple:
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Obtaining the right, consistent sponsorship. Corporate leadership at the very highest levels cannot bless and observe from the sidelines. It must serve as a powerful role model with visible, regular endorsements. Sponsorship is not a drive-by shooting, but rather an ongoing opportunity to endorse, represent, intervene, respond and advertise
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The case for change must be sold at all levels of the organization. The blueprint must be translated into the language each category of stakeholder can understand, with clearly stated “what’s in it for me” messages
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Leadership coming solely from the center rarely succeeds. Without visible business-line endorsement, center-led transformation initiatives can be easily sabotaged by strong business-line leaders who have not justified the implications of change on their operations or have been ignored in the solution process
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A network of change sponsors lightens the load. To quote a president’s wife, “It takes a village”…to transform an organization. Appointed change agents at all levels of the organization — from executives to secretaries — provide feedback, manage responses and have a stake in the solution’s success.
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Approach to Change
There is no one size fits all; an approach must be tailored to both the characteristics of the initiative (scope, solution, geographic reach and impact) and the culture of the corporation (communication patterns, values, use of measurement). Yet, rather than being built as an enabling tool for success, most change-management plans are structured as an appendage to a plan, often as code for communications.
Successful transformation is a result of careful planning and positioning of a new business model, implemented by sheer hand-to-hand combat. Most approaches focus on ticking off the steps in a plan, not the participation and motivation of the people who may have to change the way they reach their customers, process invoices, obtain payroll information or close their books.
Since most organizations do not undertake just one change program at a time, it is critical to coordinate with other corporate initiatives. Often, the goals of one transformation program are not met because they clash with or are diametrically opposed to those of another.
Effective approaches to change have the following characteristics:
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Effort is focused on changing the things that matter — those that result in a tangible, measurable improvement for stakeholders. Understanding fears and responding to motivations should guide the change program
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A consistent enabling framework for change, orchestrating resources, tools and messaging. A framework provides a discipline that facilitates engagement, dissemination of information, intervention when necessary and obtains buy-in
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A robust communications strategy. The strategy should be based upon transparency (as to benefits) and precision (as to the degree of change) — what does and does not, and what elements of the transformation are at any point in time undetermined or undecided
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Capacity to track changes and reactions of stakeholders with built-in response models. Most reactions to change can be identified in advance, and packaged effectively.
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Scope of transformation as appropriate to the organization’s ability to change. Often offshoring and outsourcing programs include too much process scope, introduction of too many tools or too much rush to cover geography. The deployment approach — phasing, staging and sequencing — can be structured to promote transformation. |
