Outsourcing relationships are unpredictable. Sometimes they work and sometimes everything that looks rosy when the outsourcing relationship is starting out begins looking dull almost immediately after the contracts have been inked. So what makes a successful Outsourcing relationship?

We believe that setting up an Outsourcing Governance can make or break an outsourcing relationship. Here's why:

Stakeholder buy-in: Stakeholder participation and involvement is very important in any outsourcing decision. A company that makes sure that each cross-section of its stakeholder audience is appropriately represented and involved generally can formulate a good outsourcing relationship. When we say stakeholders, we mean the inclusion of everyone from the actual users of the services to the executives in charge of the internal and external processes. An outsourcing governance group can go a long way in ensuring that along with participation comes reality. What we mean is that the outsourcing governance team can make sure that everyone is realistic and requirements are prioritized as well as stakeholder expectations are managed appropriately without one group feeling slighted over another. When that happens, everyone operates harmoniously with little internal or external conflict.

Stakeholder participation:  Every rule and every process may be in place but an outsourcing project may still falter if stakeholders are uninvolved or don't receive communication from the outsourcing team on a regular basis. Since information is power, keeping stakeholders happy requires that the communication channel is consistently open and effective. Regular interaction is one thing but an outsourcing governance team should ensure that stakeholders feel that their time is well spent.

Execution, execution, execution: A governance team's true test is in its ability to ensure that team members deliver what they have committed to. Note that the governance team has no actual authority on most participants in this situation and therefore the governance team has a huge responsibility to make sure that people not directly reporting to them say what they mean and mean what they say. Failure of the entire process is sure if execution doesn't happen when it was promised or by the person who promised it. Due diligence in the form of documenting every change, holding people accountable, and following up on tasks and open items becomes very important to the success of the entire outsourcing relationship as well as to the effectiveness of the governance team.

More about Outsourcing Governance and its value in next week's blog..........