CIO Survey Reveals Poor Relationships limit Manufacturer's Outsourcing Success

A nationwide survey has identified that CIOs are in need of 'relationship counselling', to help them get the most from outsourcing. 74% of CIOs identified difficulty in managing relationships with partners as their biggest outsourcing headache.

Commissioned by Computacenter, the European IT services provider, and carried out by PMP Research, the survey questioned CIOs from a number of key sectors including manufacturing. The research identified that nearly two thirds (65%) of private sector CIOs (55% for manufacturing specifically) are working with a number of outsourcers simultaneously, making effective management even more of a priority. In contrast to this, less than half (45%) of public sector organisations had more than one outsource partner.

Post-outsourcing, only 7% of CIOs in the private sector, including none of those questioned from manufacturing, had seen significant changes to their in-house skill set, whereas in the public sector the number experiencing a change was four times higher (28%). This may indicate that the public sector has recognised that it needs to develop relationship management abilities in its in-house teams, as well as giving them the opportunity to learn new skills in support of their core businesses.

Commenting on these findings, MORI CIO, Ben Booth sees relationship management skills as critical: "In my experience working with a number of partners requires a very different approach. CIOs are looking for their teams to manage the overlaps and interfaces of multi-vendor relationships effectively. It is only those organisations that do get it right who will get the most out of outsourcing."

Despite these challenges, the benefits of a well managed outsourcing contract are clearly compelling. The survey also found that in the next two years, 65% of CIOs in the manufacturing will maintain or increase spending on outsourcing. In addition, CIOs from the sector stated that the most important reasons for choosing to outsource is to reduce operational costs and to be free to focus on core business.

Simon Walsh, managing director of services, Computacenter said: "Manufacturing CIOs tell us that outsourcing is helping them reduce costs, but they know it can also achieve more strategic objectives. CIOs can tap into a scalable pool of specialist resource to free up the time of their in-house staff. But to get the best out of their outsourcing partners they need to train retained employees in business planning and relationship management skills."

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