What is strategic vs. tactical outsourcing? The difference lies primarily in the relationship that you create with the vendor. Clients choose outsourcing to benefit them in both strategic and tactical situations. As long as clients are aware of the pros and cons, have a process in place, and make a well-informed decision, outsourcing can be very successful.
There are situations where you need help for only a few months or quarters. These situations may include meeting a deadline, having limited availability of specific resources or bringing a project back on track. These are tactical reasons to outsource; however, these are good opportunities to begin a relationship and then move towards strategic relationship.
Another important aspect is the pairing of vendor and client. Are you close to the vendor? Are you an important client for the vendor? Do you have access to the management team of the vendor? A vendor for a $500K per annum relationship is different than a vendor for a $10M per annum relationship, even though both may look similar.
Proximity is another important factor. When things go wrong, you can spend face-to-face time with the vendor and bring things back on track. Local presence is important. Also, if vendor has her own facility in low cost destinations like India, it may offer an added advantage and flexibility.
Lastly, demonstrated capability is crucial. Has the vendor successfully delivered to companies like yours?
Outsourcing with Optimus
We have clients who decided to use Optimus as an extension of their core team. This provides them with elastic delivery capacity, while at the same time, retaining key knowledge within their own team. Many of these relationships have continued for years and have provided clients with significant economic and time to market benefits.
We develop relationships based on these factors. We are conducting 2 hours workshops to discuss “Outsourcing in Connected World.” Let us know if you are interested.