Outsourcing study reveals importance of risk management

Posted by Steven Gaskill

A new study has emphasised the importance of IT outsourcing providers and their clients working together to manage risks.

ESI International conducted a global research study and found that around half of clients and providers are effectively managing the risks involved with outsourced projects.

The overwhelming majority of respondents said keeping control over product or service quality is the main danger area for organisations.

"The ubiquity of project outsourcing creates opportunities for, and demands on, organisations to better develop and refine their outsourcing competencies," said J LeRoy Ward, executive vice-president of product strategy and management at ESI International.

It was also found that approximately two-thirds of organisations spend up to half of their budgets on outsourcing, so the need for refined risk management capabilities is clear.

Kate Vitasek, a faculty member in the University of Tennessee's Center for Executive Education, US, said cooperation and a clearly-defined agreement from the start were the key ingredients to a fruitful partnership between IT outsourcing providers and their clients.