OUTSOURCING USED TO BE A TRANSACTIONAL ARRANGEMENT.
It involved farming out business functions and individual
projects to save time, money, or both. But it has evolved,
becoming more relational—and more integral to clients’
survival in a time of great disruption.
A trend toward deeper collaboration, including blend-
ed teams of client and vendor firms working together, has
been gaining momentum across a range of industries
for the past decade, according to Debi Hamill, CEO of
IAOP, a professional association that fosters collaboration
through outsourcing. Hamill sees this trend among lead-
ing firms that consistently make
the IAOP’s 10-year-old Global Out-
sourcing 100 list. “What we hear
consistently now is, ‘Unless I have
a partner to help me be success-
ful, I cannot be successful,’” she says.
Closer working relationships make sense in an age of
technology-driven disruption of business systems and
models alike. “Outsourcing now means enabling man-
agement of the disruption that businesses are suffering
from,” says Jagdish Dalal, president of JDalal Associates
and a chief advisor to IAOP. “If businesses can’t change
on their own to keep up with the times, they need to go
find somebody who can help them change.”
And integrative partnerships are gaining trac-
tion because they’re paying off. Take health care,
for instance. For managing complex coding and ac-
counting, providers can get the expertise they need
from business-process outsourcing (BPO) firm Vee Tech-
nologies. But working together means much more than
handing off bills for processing.
Example: A major U.S. health system had a cash-
flow problem that pointed to accounts receivable (AR):
$16 million was more than 120 days overdue. Vee Tech-
nologies teamed up with the client not only to boost col-
lections, but also to rectify the client’s flawed systems.
The solution reduced outstanding AR to just $4 million
over 14 months.
“We set up a six-month specialized team with staff
from Vee Technologies and from the client,” says Vee
Technologies president Patrick O’Malley. “They identified
issues right away. A lot of the denials of payment were
because of their own internal processes.”
Leaders are recognizing the opportunities this kind
of partnership brings. Information Services Group (ISG)
increasingly delivers digital transformation solutions for
the world’s largest companies and has saved clients $29
billion since 2010.
“We are helping them transform every facet of their
business, from back-office workflows to consumer-facing
apps,” says ISG chairman and CEO Michael P. Connors.
And as outsourcing keeps evolving, practitioners are
on track to keep discovering what else is possible through
close collaboration—while keeping their businesses hum-
ming in the process.■
Comes of Age
In disrup tive times, clients
and vendors blend teams
to accomplish more.