Develop outsourcing skills in slump, purchasers urged

23 May 2001
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24 May 2001 | David Arminas

Purchasers must ensure they develop their outsourcing skills as companies look to re-engineer themselves during the present economic slump.

"Many of the more progressive companies are aware of the importance of involving procurement professionals in outsourcing deals, but far more still fail to include purchasers," said Roy Ayliffe, director of professional practice at CIPS.

"A steep slowdown, not even a recession, would speed up the process of outsourcing," predicted Ayliffe, who was speaking on the official launch of a major series of practice and policy documents from CIPS.

Purchasers should have the knowledge and skills to manage the outsourcing process and to advise colleagues of the most appropriate solution for best value for money in the provision of services, according to the document Outsourcing.

It says buyers should ensure that firms are clear about why they are outsourcing right from the outset. When they aren't clear about their reasons, buyers should warn the firm if it insists on progressing with the project.

But purchasers often face an uphill struggle to become involved in outsourcing, Ayliffe said, adding that there were two dimensions to the problem.

The first was that "many firms fail to notify their procurement professionals when they decide to outsource because they don't recognise outsourcing as purchasing. Rather it was about something that must be got rid of, when in fact outsourcing was actually buying services".

The other dimension is that many procurement professionals have simply not developed their outsourcing skills, including negotiating, he said.

Successful outsourcing strategies are likely to include cross-functional team work, notes the document. The team may include heads of human resources, finance and resource management in order to determine a strategy and rationale for the project. Senior management commitment is something that purchasers should be attracting.

* All the CIPS documents and policy statements are available at www.cips.org/about/policies.asp.

SMmay2001

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