Survey suggests UK Directors in disagreement over outsourcing ownership

IT leaders are in major disagreement with fellow directors over the ownership of outsourcing projects, according to research.

While 83 per cent of UK IT directors believe they should represent outsourcing at board level, only one per cent of finance directors and managing directors agree.  The survey, commissioned by IT services provider HCL, is based on interviews with 100 UK IT directors and 200 UK finance directors and managing directors.  It reveals that 40 per cent of non-IT directors prefer the finance director to lead outsourcing initiatives and 25 per cent prefer the operations director.

But only two per cent of IT directors favour finance directors for outsourcing leadership and just eight per cent say leadership belongs to the operations director.  But all directors agree that a separate ‘chief outsourcing officer’ or outsourcing director would not help the business.

‘It is crucial for the success of an outsourcing agreement that the customer retains the necessary and required level of control,’ said Rajeev Sawhney, vice-president HCL Technologies.  ‘This means there has to be a figure that holds responsibility and authority over the outsourcing issues.  However, identifying who this person is clearly a bone of contention.’

Rajeev Sawhney, vice-president HCL says that historically outsourcing has been managed by the IT director, but finance and managing directors see it as moving into their realms. ‘This presents IT directors with as much as an opportunity as a threat as they can develop their business skills and use outsourced operations as a stepping stone to the board,’ he said.

Nigel Roxburgh, co-founder of the National Outsourcing Association, said: ‘There’s always a platform and a technological implication for any outsourcing deal as most rely on remote provision of service, so an IT director should make a key contribution with the decision makers, but that does not necessarily mean he should take ownership.  At the end of the day, the chief executive and the financial director have key input because large outsourcing deals have a strategic implication for the direction of the company.’

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