Strong Governance is your Outsourcing Success Insurance

Governance is the people, processes, tools and infrastructure that enable an organization to preserve and achieve the intent of an outsourcing effort.

The critical aspects of a good governance program:

  1. A structured approach with clear goals, objectives, KPIs and performance measurements will provide a framework to oversee the contractual obligations. This will enable the collective team to create a results oriented operation. Scorecards and other tools should be developed jointly and are valuable tools to track past progress and keep moving forward toward future targets.
  1. Communication needs to be bi-directional and focus on facts, not subjectivity. Set the tone early in the program and move beyond discrepancies quickly. Fact based performance will bring about fact based results. Monthly and quarterly meetings should have set agendas to discuss the recent scores, and set goals for the new month/quarter.  These meetings are an opportunity to assess progress, which will bring about continuous improvement as the program moves forward.
  1. With good two-way communication and fact based performance reviews completed, your ongoing dialogue can focus on strategy and future business initiatives. A bi-annual and annual meeting can focus on achievements, confirm that the program is on course, and develop new targets and goals for the upcoming year. These ‘State of the Union’ reviews are valuable opportunities to assess and modify any of the KPIs or other measures should they be necessary.
  1. Remember this is a partnership. Transparency and jointly developed action plans will bring tighter alignment with your business objectives. This can only be achieved if the supplier understands your goals and plans.  By collaborating on the implementation of the governance program you can ensure success and get more accomplished in a shorter timeframe.
  1. An effective platform capable of managing complex scoring, reporting and other tactical issues around the globe will ensure that generation of the scorecards will be a non-issue. You will spend more time analyzing the data, and strategizing about how to hit your next target, versus defining vocabulary and agreeing on reporting formats.

A strong governance program ensures that you have in place the proper communication, the tracking tools and the ability to fix the problem, so you can move on, and up, quickly.  It will elevate the relationship to the next level and enable focus on strategic issues of how to improve collective performance across the portfolio. A successful governance program allows the partnership to focus on strategy and metrics and how to reach the best in class model faster, versus the logistics of every day tactics.  It frees up time for each of the respective parties to focus on new initiatives or broaden responsibilities.

If you would like to find out more about how governance programs and supplier management strategies, can help you achieve your goals please call us at 850-578-6105.