Outsourcing of routine non-core activities
A Dutch software giant expanding its international activities at a rapid pace. The company is compelled to focus on its core competencies due to the heavy competition in the industry. Company’s business units are obliged to follow this decision to focus on core activities and to outsource their non-core routine activities.
To differentiate between core and non-core activities of the IT department, identify non-core routine work that can be outsourced and implement the change are major challenges to the IT manager. A request to play a role of the manager of IT department.
IT department’s activities were evaluated against the company’s core strategies. The non-core routine activities of the department were identified and prioritized for outsourcing. With the help of RFI/RFP process suppliers of managed IT services were shortlisted. Carried out selection of supplier, negotiations, contract signing and implementation of the change. Part of the IT staff was taken over by the supplier, a part was retained in the department and the remaining staff was re-trained and moved to other departments.
The routine non-core activities of the IT department, such as workstation management, networking and telecom management were outsourced to a renowned managed services organization. The costs and overheads were reduced drastically. The effectiveness and efficiency of the IT department increased due to the focus on core activities.