Ever heard of an outsourcing deal dying out, after a few years down the road?
Many stories run like this:
- Company A decides to outsource one of its tasks (IT, marketing, legal, facilities, HR, accounting, etc.). They selected Provider B as their best choice.
- After an often-demanding ramp up period, everything goes basically alright.
Note that according to several research, at this point, already 25% of the deals broke. And even further, only 50% of all outsourcing bring the excepted value during its initial term.
- In our story, Company A and Provider B are continuing their journey, with some unavoidable ups-and-downs, for say about 3 years and more.
Now comes the third breaking point that we want to address here: almost all outsourcing deals are breaking overtime, either by external events (such as change in management, technology, etc.), or by time erosion