Page 21 - Logistics News - June/July 2021

I T OU T SOURCING

Pandemic proofing IT outsourcing

IT outsourcing makes sense as it creates efficiencies and eliminates redundancies, but the
COVID-19 crisis has highlighted the importance of making sure that your organisation’s IT suppliers
are ‘pandemic proof’, says Jon Butler, Principal at consulting firm StrategyShore LLC.

S IT department will get more expensive. If you
peaking at the second annual IT
outsource, the service provider can manage career
Sourcing Summit for African IT
professionals, Butler noted that
your business as required. They can bring people
companies sourcing from one location had costs and attrition, moving people in and out of
been hard hit when that location was impacted in from other locations, to constantly deliver fresh
by COVID-19. “Always choose to source from ideas and new talent, helping you to make your
multiple suppliers and multiple locations when organisation world-class.”
Jon Butler, Principal
you can,” he urged delegates attending this
at consulting firm
virtual event hosted by Smart Procurement “But the service provider must not have
StrategyShore LLC.
World. too much control,” he stressed, and cautioned
delegates not to “let the tail wag the dog” with outsourced IT
The Wall Street Journal reported that in the first quarter services. “Good contracts and proper governance are vital.
of 2021, nearly all Fortune 500 companies had some level of Penalise providers when they miss things. Put pressure on
exposure to India’s COVID-19 crisis in their IT operations, your service providers.”
according to consulting firm Hackett Group Inc. Interviewed
in the same article, US-based Butler said, “Spreading out “Beware the ‘watermelon effect’,” Butler said. He explained
third-party IT support among global providers can help that this is when service providers constantly provide green
companies guard against sudden shocks to operations. statuses in project and service level agreement (SLA) reviews.
Relying on a single location for critical IT services is playing “Are people in your organisation in agreement, or are they
with fire. Things can and will happen, and when they do, experiencing problems with the service while the provider
those in singular locations are always seen scrambling and is giving all green statuses? If this is the case, then you have
rarely meeting their prior commitments.” a watermelon situation, where things are all green on the
outside, but red on the inside,” he explained.
Butler’s advice was, “You need to create a supplier
network that can sustain you when different nodes are down. The IT Sourcing Summit, which Smart Procurement
Your contract should include being able to go in and audit the World hosted this year for the second time, this year, aims
IT service provider at any time. Check their security. Check to help African IT sourcing and procurement professionals
their disaster preparedness. Go in and start up generators. to tackle the unique challenges they face as they strive to
Do a ‘country down scenario’ and a ‘city down scenario’. Are meet their organisations’ digital needs. Commenting on
they ready? Make sure that your ecosystem of suppliers can the importance of this summit amid the challenges of the
survive any kind of pandemic or chaotic disruption.” COVID-19 crisis, Debbie Tagg, Smart Procurement COO,
says, “There is no denying that the global pandemic has
Expanding on the benefits of outsourcing, Butler noted catapulted us into the 4 Industrial Revolution. Globally,
th
that there were substantial advantages to outsourcing an the way that we do business has changed and the drive for
organisation’s non-core competencies. “This is work that digitalisation within organisations has left many procurement
is not producing a product or selling a service and includes and IT professionals scrambling to access the best hardware
IT activities. Outsourcing creates efficiencies, eliminates and software solutions to enable efficiency across their L O GI S T I CS NEWS
redundancies and can enable an organisation to reduce organisations. The spotlight is on IT procurement and
its workforce and thereby cut costs. As people advance in professionals need to have a clear grasp of what to do and how
their careers, they will expect to earn more. Your in-house to go about making purchasing decisions.” •

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