Improving the reputation of outsourcing
by Debra Maxwell, Managing Director, arvato UK
Thursday, June 26, 2014
Few of us would doubt that outsourcing has an image problem. For many the sector is, mistakenly, synonymous with job cuts and off-shoring, and some high-profile failures and disputes over the past 12 months have not helped matters.
The net results of this is that the contribution outsourcing makes to the UK economy is overlooked – from the millions of jobs it sustains to the technical innovations it helps launch and the cost savings it delivers for a large number of organisations, public and private.
This is one of the reasons why we’ve decided to launch a quarterly index tracking the volume and nature of outsourcing deal activity in the UK market. We aim to help shine a light on the level of economic activity the sector is responsible for and, hopefully, to move the debate towards something more factual and positive.
Our first set of results shows an industry in rude health. In Q1 the total value of contracts rose 65% year on year to over £2 billion. In addition, more than 20 vendors secured large-scale contracts and more than half of deals were first-time outsourcing agreements - new requirements representing new work for UK employers.
If nothing else this demonstrates that there is a clear business case for outsourcing, with many organisations continuing to use it as a means to achieving their objectives.
This is particularly true for the public sector, where we saw a 168% rise in the value of outsourcing contracts year on year. This strong performance suggests that for government clients private sector partnerships remain a key strategy to reduce costs while protecting front-line services.
The fact that three quarters of all contracts secured in the first quarter involved all services being delivered in the UK should be also be considered a positive for UK plc.
Yet despite this level of economic activity the sector still lacks even one dedicated national newspaper journalist reporting on its performance.
Alongside the National Outsourcing Association’s (NOA) continued efforts to promote the best practice emerging from the industry in the UK, it’s up to the outsourcing partners involved to continue to share stories of success. By delivering real value through service excellence and investment into people and skills, outsourcing might just start to change people’s minds.