Understanding Professional Services Outsourcing and Offshoring

Based on a series of semi-structured interviews with 10 supply management executives representing eight companies in a variety of industries, this research focuses on the topic of services outsourcing and offshoring. Findings from these interviews indicate that a number of firms that have been offshoring for some time believe that they have outsourced too much responsibility for certain services, thereby increasing their operating risks. They have developed new solutions to attempt to address these problems, as will be discussed in the presentation. Summary. The topic of professional services offshore outsourcing has been very controversial from a political perspective. Further, the media reports mixed results in terms of cost savings and level of satisfaction (Corbett, 2005). Our findings support that in some cases, it is possible for a customer to rigorously specify, monitor and measure service level expectations, resulting in improved supplier performance as well as improved customer satisfaction. There is a complex balance that must be maintained between the cost savings associated with outsourcing professional services versus the level of risk incurred and the customer satisfaction. Successful Cases. The organizations that experienced success in offshore outsourcing of services displayed a number of common characteristics in their successful outsourced relationships. They outsourced services that they: