Motivating your Outsourced Offsore Team

How do you sustain the interest of your new outsource team? Here are ways to keep the team passionate about providing you with top-quality service.

The success of a business relationship between a company and an outsource vendor depends on how well the delivery team implements projects on-time and on-budget. But while these three items present only the quantitative facet of this relationship, the dedication and professionalism of the outsource team sometimes tell a different story.

Establishing a new relationship with your new outsource team is important to the success of your venture. How do you sustain the outsource team’s interest in your project? What will keep them passionate about providing you with top-quality service? Will you keep the top outsource performers?

Human resources, and not technology, are a company’s prime asset.

On the Human Resources front, retaining new hires and recruiting top personnel become a real challenge as companies compete for skilled workers. BPO companies need to immediately address the challenges of keeping their trained workers from getting hired away by competitors.

The quality of an outsource team’s output is directly proportional to the satisfaction they have in fulfilling the demands of your business. And much of this hinges on how well you value them as workers and their work. How do you make them feel that they are an integral part of your success? How do you make them feel as if they were your employees instead of outsourced consultants and workers?

  • Give them a clear idea of your business objectives. Give your outsource team a bird’s eye view of your business goals because knowing these goals promotes accountability for the project. It allows them to align their professional goals with your success. It pushes forward the idea that a successful business is a reflection of the quality of their work.
  • Respect them as knowledge workers. Aside from lowering your operating costs, the reason why you hired them in the first place is because of their knowledge and skills. Involve them in brainstorming sessions, ask for their ideas and consult them about process improvements. Most outsource teams do not only see themselves as engineers, communicators, or managers. Prior to your business engagement, they were groomed as consultants. So, picking their brain once in a while is a good exercise.
  • Provide training. On top of paychecks, health care, and other fringe benefits, one of the major perks that outsource teams often consider is training. Providing technical trainings enables your outsource team to address the most difficult aspects of your business. Giving them soft skills trainings in business etiquette and communication paves for smoother project management and escalation procedures. The confidence that comes from knowing that they have the right knowledge and skills to do the job well becomes apparent as the relationship matures.
  • Make room for learning curves. Outsource teams need significant learning curves to fully acquaint themselves with the nature of your business, your corporate culture, your own processes, and the technical requirements of your project before they can function effectively. Give them time to learn the ropes and adopt your business culture as theirs.
  • Communicate clearly your business and project requirements. Do not assume that once you have given them your requirements document, your team can implement the project right to the last detail. Frustration happens on both sides of the project relationship when requirements are not clearly communicated. Make sure that you have exhausted all channels of communication, and that objectives, designs, and requirements are clearly communicated or interpreted. Use visual aids, screen shots, charts, and diagrams. Set up Placeware sessions or video conferences.
    Having an agreement on requirements is especially crucial when your off-shore team resides several time zones away. E-mail takes at least 12 hours to be addressed, while phone calls require one of you (often the off-shore team) to sacrifice personal time. And there is nothing that discomforts any worker than sacrificing personal time.
  • Provide the required infrastructure. Make sure that your off-shore team has the necessary hardware and network in place to enable them to accomplish their tasks. If you are worried about data security and requires your off-shore team to work within your network environment through remote desktop access, giving minimal network allocation will only upset your team as they scuttle to meet your deadlines. Frustration leads to stress, stress leads to absenteeism, and spotty attendance leads to missed deadlines and possibly, low-quality outputs.
  • Respect their time. Always remind yourself and your management team that outsource workers live several time zones away. While you are fast asleep, they are already developing, documenting, and checking your project. When you login to work, they have already earned their keep for the day. Do not expect them to extend their working hours or be available for you round the clock to give immediate answers to your questions. They, like you, need to spend time with their families and friends, and that they have to attend to personal responsibilities.
  • Respect their culture. Take the time to get to know the outsource team’s own corporate culture, their approaches to quality control, their communication styles, and business ethics. Because your outsource team is of a different nationality, be aware of their customs and traditions. Plan delivery schedules ahead to allow room for the observance of religious holidays and celebrations. As you become aware of your cultural differences, you can find better ways to make the team more receptive to your corporate culture and customs.
  • Provide a budget for extended working hours and working shifts. There are times when your outsource team may have to extend working hours. In some countries, outsource vendors charge a premium for extended working hours or night shifts. Set aside a budget for this scenario. Otherwise, do not expect members of the off-shore team to stay beyond the daytime working hours or accept shifting schedules.
  • Will work for travel. Many off-shore workers treat business travels as perks of the job. Pick the key players in your off-shore team to get on-shore trainings or attend client meetings. Bring them on-shore to experience your working environment and to meet the in-house members of your company. Provide a budget for the necessary travel requirements, such as Visa and passport, transportation, and accommodation.
  • Allow key players in your outsource team to telecommute. As a business continuity plan arrangement, telecommuting enables off-shore consultants to stay in the loop and communicate project development status. Some companies allow employees to work from home on Fridays when work is slowing down while withholding the same privilege from consultants. Telecommuting allows parents to stay with their kids while working on your projects. Even consultants need to stay away from the stress and hassles of daily commute without missing a days worth of work.
  • Recognise their achievements. Celebrate small victories. Workers want recognition for their hard work. Getting the proverbial pat in the back not only means that they have done well, but that you have approved of their job. Your recognition for their hard work is a card that they can play when performance review rolls around. Your most motivated outsource workers will work harder if they believe that a promotion or bonus is affected by your recognition.
  • Pay them well. Just because you are outsourcing part of your business in a low-cost economy to save on operating costs does not mean that you can scrimp on workers’ paychecks. It is common knowledge that outsourced projects are more demanding and require higher levels of knowledge, skills, and commitment. Outsource vendors from all over Asia, Central America and Eastern Europe are now fighting for top talents, and these talents are hard to come by. Therefore, if you wish to keep the best among your outsource team members, pay them according to the worth of their diplomas, certifications, professional histories, and the wisdom that they bring in to your business.

Leveraging the ITIL Service Support Framework

Service desks exist to resolve end-user computing incidents. But in many cases, the front-line service desk acts as little more than an answering service, logging incidents and forwarding them to a more senior IT person for resolution. Further, service desks often lack the information needed to address end-user incidents — particularly those that involve proprietary applications.

The under-utilization of front-line service desks poses both cost and credibility problems for IT organizations. Incident resolution costs (and indirect opportunity costs) increase as cases are passed on to more senior IT specialists. Business users suffer from productivity declines and perceptions of IT often sour as customers fail to see their issues being addressed in a timely fashion.

One approach in addressing these challenges is the implementation of integrated Service Management processes that enable the IT organization to better integrate and manage change and the flow of information between groups and disciplines within IT.

The Problem

Service desks typically function as the primary point of contact between IT and the end-user community. Despite this critical role as IT ambassadors, front-line service desks often are ill-equipped to handle many technical issues beyond the most basic desktop and networking functions such as permissions and password resets.

Service desk team members generally possess only a basic understanding of the IT infrastructure’s components (network components and desktops) and their interrelationships. Further, service desks are often not informed of planned changes to the environment. Instead, front-line service desks tend to focus more on answering the phone quickly, ensuring good customer service skills, and resolving basic and “known” incidents and service requests.

Organizations with this orientation generally exhibit the following conditions:

  • A lack of shared tools and information across IT disciplines
  • A lack of effective knowledge transfer from various teams and disciplines within the IT organization to the front-line service desk
  • Poorly adhered to, or nonexistent, processes governing IT operations

In configurations where the front-line service desk is underutilized, there exists the opportunity to significantly enhance the desk’s value by increasing its ability to resolve a larger and broader set of issues. This in turn will help contribute to reduced incident resolution costs and help to support good relations between IT and the business.

The Solution

To enhance the capacity of the service desk to provide sustained higher-end incident resolution, changes across the entire IT operation are required. This can be done by instituting integrated IT Service Management best practices that will:

  • Significantly enhance the efficiency and reliability of IT systems and infrastructure
  • Provide substantial resources to the front-line service desk to provide informed high-quality support to end users that will reduce the flow of cases to more expensive IT resources

One of the leading best practice frameworks in the provision of IT Service Management is the Information Technology Infrastructure Library, popularly known as ITIL. ITIL was developed in the 1980s when the British government determined that IT service quality provided by both internal and external resources was inadequate to its needs. Bodies within the government, in partnership with various contractors, developed the standards to be general enough to apply to public and private sector organizations of varied size and industry and with all sorts of unique needs and challenges.

Today, thousands of organizations use all or some of the ITIL standards to provide a framework to manage the provision of IT services.

Three sub-disciplines (or modules) of the ITIL best practice framework directly address key functions within the IT operation that have a direct impact on the quality of service delivered by the front-line service desk. They are:

Configuration Management

In the ITIL framework, Configuration Management is a discipline that organizations use to gain and maintain control and proper oversight of their IT infrastructure in order to deliver high-quality, consistent, and economical services to their organization. This is done by creating a comprehensive model of the IT infrastructure and its asset components, particularly focusing on the relationships between assets. In practice, Configuration Management involves the maintenance of a Configuration Management Database (CMDB), which contains details of the current state of all elements of the IT infrastructure and their relationships to one another.

Change Management

Change Management is a structured process and approach toward making changes to the IT infrastructure. It is designed to gather suggested changes from multiple constituencies, and to ensure that changes are authorized, prioritized on an enterprise basis, and that all impacts have been recognized and considered, thus reducing the potential for support incidents in the user community.

Release Management

Release Management is an ITIL discipline that uses a series of prescribed procedures and checks to ensure that any changed or new elements slated for release into the IT infrastructure do not negatively impact the live environment or its users. Release Management involves building a set of release components, testing them, assessing potential impacts, scheduling the release, and performing the release.

The Service Desk Balancing Act

Managing a service desk is a balancing act. Keeping an eye on how effective and efficient the service is performing is critical because the perception of how well IT is
performing is often influenced by how well the service desk performs. This note will examine three sets of service level metrics related to the performance of an actual help desk and provide insight to the issues faced by service desk managers.
I propose steps that can be taken to improve the service provided by your help desk, and thereby raise the perceived value of your IT services.

Metric Set #1 – Call Volume (Including Calls Abandoned) vs Ticket Volume

One common issue faced by service desks is that customers can not get through to a representative for assistance. They call the service desk phone number, and then wait in queue for an unreasonable period of time. The caller gets disgusted, hangs up, and/or calls a support person or IT contact directly. This action represents an “abandoned call”. Many of the phone systems used by service desks will keep records of the number of abandoned calls. These statistics are useful to collect and report as one measure of the effectiveness of a help desk. It is also important to measure the call abandoned rate to provide a “before/after” snapshot of the effectiveness of a service desk implementation. Success may mean that the abandoned call rate is reduced to a very low level, say 2% versus the current levels. The abandoned call rate, total number of phone calls made by the service desk (in and out), and the total number of tickets opened by the service desk for a specified period of time can be assembled into a slide that effectively communicates the current state of the service desk.

Implementation Solution Ideas:

One key to reducing abandoned call rate issues is to reduce dependency on the telephone. As calls come in the help desk representatives should integrate with back office support using instant messenger, and email in real time. If the help desk representative needs to assign a ticket to a support team, the process should occur automatically; the representative should not have to use the telephone to manually escalate tickets to the support team. Also, when tickets that are escalated to the support teams are completed, communication back to the customer can be automated. He/She can be informed that the call has been resolved and can be instructed to contact the help desk if the problem persists. Each point in the process where human interaction is required is an opportunity to leverage automation. The people responsible for providing the service desk service have to decide on the appropriateness of automation for each step. The goal is to keep the phones available for incoming calls and reduce the outgoing calls used to contact support staff.

Service Metric #2 : Number of Tickets Opened per Time Period

Many help desk staffs will complain that they are overworked and “stressed out”. They will often be requesting additional staff to man the phones to help take calls. Help desk management is usually aware of the problem, but want to understand how pressing the need really is. Additional staffing will impact the organizations bottom line pretty quickly, and senior management will expect a lot of detailed justification. Help desk management may ask you if the additional staff is really needed.

Using metrics from the help desk software, you can prepare a chart showing tickets opened per hour. This information provides insight into the ticket throughput for the service desk, and can be used to estimate the number of tickets each representative has to process on average in any given hour. Knowing the effective throughput rate for processing calls can also help to adjust the triage processes used for incoming calls. The automation discussion from the abandoned call rate graph above also applies here, but so do some additional elements. For example, after examining several help desk implementations, we found that representative training and incentives for first call closure also impact the help desks ticket throughput. Written instructions and processes for triage and service call resolution must be followed consistently by all help desk representatives. Incentives for service desk personnel have to be carefully thought out and balanced with the skill set of the people taking the calls. Too little skill and the first time resolved rate is too low, too much skill and the representatives will try to own the tickets for too long trying to demonstrate their prowess at problem resolution.

Rewarding service desk employees for first time call resolves can be detrimental to the service desk team’s ability to effectively process calls in a timely manner – especially when available resources are taxed by incoming call volume. If the strategy to resolve every call the first time is the only strategy, you run the risk of backing up the call queues during peak hours

Service Metric #3 : Impacted Users by Call

Assessing the impact and urgency of service calls is part of an effective “triage” process which should be performed for every incoming Service Call. A primary function of the service desk is to provide communication and resolution for incidents that impact multiple users. One-on-one help from a service desk technician is the most expensive help that can be provided.

We have examined three analyses of service desk data. In each case we were able to relate metrics extracted from the service desk as key performance indicators for measuring the impact of the changes proposed. When implementing a new service desk or changing the processes that govern how services are utilized it is a good idea to take a sample of the data before and then after the changes are put into effect.

The unit cost of the ticket can make an excellent metric for estimating the ROI of some of the proposed solutions. The following discussion will explain how to utilize the service desk ticket as a unit for estimating ROI: Take the annual budget of the service desk and divide it by the number of tickets processed. The result is a dollar cost/service call. This figure can then be applied to the estimated reduction in the number of tickets opened at the service desk for any particular new project to give a
simple calculation for the value of the savings to the company.

Service Desk Survival Guide

Asses your operations

· Conduct a benchmarking assessment

· Listen to your customer, team, peers, etc. (Sit in on the phones).

· Challenge your direct reports (“How Do you know” and “Show me”).

· D3 – Drill Down into the Details

· Enlist a Third Party Service Desk Expert

o Methodology

o Preparation

o Urgency

o Timeliness

o Executive Briefing

Review your Delivered Services

· List Services Currently Delivered

· Rank in Order of Importance/Value To Customer

· Categorize Services Into Problem And Request

· Identify Services Where You Add No Value

o Look for ways to Deflect or Eliminate

· Estimate Cost To Deliver Services

· Map Your Team’s Skills To Your Services

· Any thing left over for the valued services?

Know What and Who You Should Know

· Identify the Critical Elements of Your Support Business

o Supply, Demand and SLA adherence

o Total Cost of Support, Cost per Contact and Solution

o Don’t forget the customer’s who stopped calling!

o Service Desk Professional Utilization

o Top 5 Call Types by Volume and Mean Time To Resolve

· Identify and Report Business Impact and Employee Productivity Trends

o Barriers to Total Contact Ownership

· Identify Key Sponsors and Champions of Service Desk

o Senior Level Management

o Customers

o Business Drivers

Invest in Training Your Team

· Increase productivity

o High Impact Training

o Screen Human Harmony

o Automate the Manual

· No better time

o Create Career paths

o Invest in Training and Certification

o Mentor and Coach

· Former Intel CEO Andy Grove says never forget that your career is your business:

o “Every person … is like an individual business. Your career is your business –and you are its CEO.”

o Although your career may be on track, be sure not to ignore turning points that could lead to greater success –or bitter failure.

o You’ve got to keep track of the market, watch for competitors and look for better ways to do things.

· Grove says a “mental fire drill” can help every career

o Read newspapers, trade magazines and books (“Leaders are Readers”)

o Attend industry conferences

o Listen to associates to learn when change is imminent

The Art of Customer Service

  1. Start at the top. The Manager’s attitude towards customer service is the primary determinant of the quality of service that a company delivers. If the Manager thinks that customers are a pain in the ass who always want something for nothing, that attitude will permeate the company, and service will be lousy. So if you are the Manager, get your act together. If you’re not the Manager either convince her to change her mind, quit, or learn to live with mediocrity–in that order.
  2. Put the customer in control. The best kind of customer service happens when management enables employees to put the customer in control. This require two leaps of faith: first, that management trusts customers not take advantage of the situation; second, that management trust employees with this empowerment. If you can make these leaps, then the quality of your customer service will zoom; if not, there is nothing more frustrating than companies copping the attitude that something is “against company policy.”
  3. Take responsibility for your shortcomings. A company that takes responsibility for its shortcomings is likely to provide great customer service for two reasons: first, it’s acknowledged that it’s the company’s fault and the company’s responsibility to fix. Second, customers won’t go through the aggravating process of getting you to accept blame–if you got to the airport on time and checked your baggage, it’s hard to see how it’s your fault that it got sent to the wrong continent.
  4. Don’t point the finger. This is the flip side of taking responsibility. As computer owners we all know that when a program doesn’t work, vendors often resort to finger pointing: “It’s a middle tier problem” “It’s Linux way of doing things.” “It’s the way Pasta created the print out” A great customer service company doesn’t point the finger–it figures out what the solution is regardless of whose fault the problem is and makes the customer happy. As my mother used to say, “You’re either part of the problem or part of the solution.”
  5. Don’t finger the pointer. Great customer service companies don’t shoot the messenger. When it comes to customer service, it could be a customer, an employee, a vendor, or a consultant who’s doing the pointing. The goal is not to silence the messenger, but to fix the problem that the messenger brought so that other customers don’t have a bad experience.
  6. Don’t be paranoid. One of the most common justifications for anti-service is “What if everyone did this?” For example, what if everyone bought a new wardrobe when we lost their luggage? Or, to cite the often-told, perhaps apocryphal, story of a customer returning a tire to Nordstrom even though everyone knows Nordstrom doesn’t sell tires, what if everyone started returning tires to Nordstrom? The point is: Don’t assume that the worst case is going to be the common case. There will be outlier abusers, yes, but generally people are reasonable. If you put in a policy to take care of the worst case, bad people, it will antagonize and insult the bulk of your customers.
  7. Hire the right kind of people. To put it mildly, customer service is not a job for everyone. The ideal customer service person derives great satisfaction by helping people and solving problems. This cannot be said of every job candidate. It’s the company’s responsibility to hire the right kind of people for this job because it can be a bad experience for the employee and the customer when you hire folks without a service orientation.
  8. Under promise and over deliver. The goal is to delight a customer. For example, the signs in the lines at DisneyLand that tell you how long you’ll have to wait from each point are purposely over-stated. When you get to the ride in less time, you’re delighted. Imagine if the signs were understated–you’d be angry because Disneyland lied to you.
  9. Integrate customer service into the mainstream. Let’s see: sales makes the big bucks. Marketing does the fun stuff. Engineers, well, you leave them alone in their dark caves. Accounting cuts the paychecks. And support? Do to the dirty work of talking to pissed off customers when nothing else works. Herein lies the problem: customer service has as much to do with a company’s reputation as sales, marketing, engineering, and finance. So integrate customer service into the mainstream of the company and do not consider it profit-sucking necessary evil. A customer service hero deserves all the accolades that a sales, marketing, or engineering one does.
  10. Put it all together. To put several recommendations in action, suppose a part breaks in the gizmo that a customer bought from you. First, take responsibility: “I’m sorry that it broke.” Second, don’t point the finger–that is, don’t say, “We buy that part from a supplier.” Third, put the customer in control: “When would like the replacement by?” Fourth, under promise and over deliver: Send it at no additional charge via a faster shipping method than necessary. That’s the way to create legendary customer service.

ITIL Conclusions

  • Proof that the adoption of ITIL produces, for most of those who measure it, a real improvement in service levels to the user base as customer.
  • More than half of adopting companies measured a distinct improvement in customer satisfaction.
  • ITIL benefits staff. Not only does their work competence increase, but so does their job satisfaction.
  • The size of your company is no limit to or likelihood of your adopting ITIL or not. Size does not appear to make a difference. You can take up ITIL with just two people in the IT department.
  • The typical ratio of IT headcount to userbase is around four to six percent – this by-product of the survey could be seen as a staffing benchmark.
  • Taking up ITIL still remains a matter of deliberate choice rather than a must-have. This is encouraging for ITIL as a philosophy, for it suggests that despite the method’s recent prominence, it is not a passing fad or the latest IT lifestyle, but the subject of serious strategic consideration.
  • Those who adopt ITIL have a slightly heightened tendency to adopt other external practice standards in their business. Those who reject ITIL are highly likely to reject other standards also.
  • Smaller companies are more likely to be among the group rejecting ITIL. Despite its apparent workability in smaller, even tiny IT departments, the methodology is still typically the premise of the larger organisation.
  • At this stage in ITIL’s development, it is by design a methodology, not an industry standard to which companies can adhere.
  • ITIL-based companies see one of the main benefits as being the unification of the whole of IT under common practices – but ITIL alone will not necessarily deliver this. The active participation of as many departments as possible is crucial.
  • ITIL can be adopted exclusively within IT, without necessarily accounting for existing business practices and strategies.
  • A fifth of adopting companies acknowledged that ITIL had indeed given them a competitive advantage in their company’s market – and as by definition not everybody can be market leaders, this fifth reflects a commercially significant benefit to ITIL.
  • For any desired benefit, the implementers must take specific and careful steps to ensure that it comes about. Clear goals and a consistent pursuit of them are critical so the benefit does not become one of the ubiquitous ‘Almost Delivered’.
  • ITIL is an IT matter only. Business strategic, commercial and political matters, although important on an organisational scale, are not necessarily components of the ITIL implementation.
  • All sections at all levels of IT should be prepared for procedural and operational change. Concentrated study of IT procedures will be paramount and unavoidable.
  • Despite all the processes mentioned in ITIL, it remains incomplete. Adopting companies found a need to add other processes beyond those described in the ITIL literature.
  • Two thirds of those using software to support ITIL adoption found that the software had to be customised even where the software was aimed at the ITIL market.
  • There is no single way of ‘being ITIL compliant’ because the flexibility of the methodology renders the concept of ‘compliance’ irrelevant in an ITIL context.
  • First-time-fix and time-to-fix improvements delivered by ITIL have cost justification implications because quicker fixes mean that users are losing less downtime in the helpdesk queue. This service increase translates directly into a business benefit.
  • There is a trade-off between expedition and accuracy. The records in the CMDB do not just impact IT, but have a business implication, for they are a list of valuable hardware assets. Perhaps it is worth seeing a reduction in service level in exchange for an increase in the integrity of management information.
  • Benchmark the services prior to adoption in light of a probable benefit thereafter.
  • In nearly three quarters of cases, ITIL can be implemented with the same or ultimately fewer staff than at present.
  • ITIL is not a cure for all procedural ills or absences – its processes, though detailed, do not cover everything, as experienced implementers overwhelmingly agree.

Fixing Broken Outsourcing Relationships


The Issue
For a number of reasons, the reality of IT outsourcing frequently turns out to be very different than the promise of outsourcing. Recent studies continue to find that more than 50% of all IT outsourcing relationships are considered unsuccessful – and almost 70% of IT outsourcing relationships are terminated early.

Way too much attention has already been devoted to the pros and cons of outsourcing and the right and wrong ways to outsource – but I want to take a shot at an approach for turning problem outsourcing relationships into successful outsourcing relationships.

Five-Step Plan for Fixing Broken Outsourcing Relationships
Okay, bear with me a minute while I try to explain where I’m going with this. Think of me as a marriage counselor giving advice on a troubled marriage.

From what I know of marriage counselors, they typically get involved in a marriage when things aren’t going very well for either party. The married couple typically wants the counselor to “fix” the other person or they want to get out of the marriage as quickly as possible.

On the other hand, the marriage counselor is not into affixing blame. The counselor listens to the “he did this” and “she did this” stories, but the counselor’s objective is to get the marriage back on track.

That’s what I want to do. I want to get troubled outsourcing relationships back on track. Here’s my five-step plan for fixing broken outsourcing relationships:

Step 1 De-Emotionalize the Situation
I know it’s not easy when you are in the middle of a contentious outsourcing relationship, but the first thing you need to do is relax and try to eliminate the emotions associated with the outsourcing relationship. The only way you are ever going to be able to salvage a troubled outsourcing relationship is by thinking and acting unemotionally.

As counterintuitive as it may seem under the circumstances, you have to start thinking in Win/Win terms. That means trying to find a way for both sides to win with the outsourcing relationship.

Ask yourself, “Am I ready to find a Win/Win solution to our outsourcing problem?” When your answer is “yes,” proceed to Step 2. If your answer is “no,” redouble your de-emotionalizing and Win/Win visualization efforts. If you are never able to answer “yes,” skip the rest of this briefing and start looking for a briefing on outsourcing divorce.

Step 2 Establish Realistic Expectations and Objectives
The second thing you need to do is clearly define your expectations and objectives for a successful outsourcing relationship. Think Win/Win in establishing your expectations and objectives because your expectations and objectives have to be realistic.

Actually, unrealistic outsourcing expectations and objectives are a reason why many outsourcing relationships get in trouble – but I’ll have to address that in another briefing.

When you are satisfied that you have clearly defined expectations and objectives for a successful outsourcing relationship, write down the expectations and objectives.

Step 3 Assess Options
The next step is to thoroughly analyze your existing outsourcing agreement and understand your options. Understand your options for terminating the relationship and determine if you have any leverage in getting the relationship back on track.

Step 3 is a form of negotiation. You never want to get into a negotiation without getting as unemotional as possible, knowing what you want to achieve from the negotiation, and understanding your options. In other words, you want to be in as strong a position as possible when you initiate the negotiation process. By the way, this is the position you want to be in when you initiate negotiations on a new outsourcing relationship too.

Step 4 Objectively Explore Solutions With Outsourcer
After getting yourself ready, it’s time to get down to business. As emotionlessly as you can, you need to explore options with your outsourcer. The script for this discussion should begin by saying you are unsatisfied with the outsourcing relationship and you want to explore options for getting the relationship back on track. The script should not include the word “attorneys” and should definitely not say anything about the outsourcer’s personal history or business ethics.

After getting past the uncomfortable beginning of the discussion, you should be prepared to clearly spell out what you see as the problems with the outsourcing relationship and outline your expectations and objectives for the relationship. This is where you use the expectations and objectives you wrote down in Step 2.

Depending on how the outsourcers reacts, you might want to have a printed copy of Step 1 available for the outsourcer so they can understand the importance of de-emotionalizing the situation and thinking Win/Win.

I’m kidding about having a copy of Step 1 available for the outsourcer, but both sides in the discussion of options have to keep emotions in check and understand the importance of creating a Win/Win situation. You may want to use an objective, third- party marriage counselor to make this happen.

Step 5 Communicate, Communicate, Communicate
The only way you can fix a broken outsourcing relationship is by actively communicating with your outsourcer. A lot of troubled outsourcing relationships get that way because of poor communication between the enterprise and the outsourcer.

You probably don’t want to hear this now, but doing a better job of communicating might have kept the outsourcing relationship on track in the first place. There I go, sounding like a marriage counselor again.

Moral of the Story
In some cases, ending an outsourcing relationship may be the only viable option, but there are a lot of troubled outsourcing relationships that can be turned into successful outsourcing relationships by taking the emotion out of the situation and taking positive steps to fix the relationship.

I know this marriage counseling approach for dummies is a little over-simplified, but the steps are right. Give this approach a try the next time you are considering an outsourcing divorce.

Is ITIL missing the human touch?

Earlier this year a research-based report entitled “What’s next for ITIL and Service Management” was produced by the Service Futures Group ( It stated that “ITIL implementation is largely influenced by the perception, motives and attitudes of those involved. ITIL is less likely to be successful if it is implemented purely as a way of managing processes and far more likely to be successful if it is implemented as an initiative to change the entire ethos of the IT Department and to deliver benefits to the organisation as a whole”.

The areas that need attention for ITIL to be adopted successfully are people, process
and product. Organisations frequently focus on process and product, but the people aspect is often restricted to ITIL foundation training for IT staff, with little emphasis on the need to adopt a service ethos. Without sufficient attention to people, some ‘quick wins’ can be missed entirely – I call it applying the ‘human touch’.

People are key to differentiating between perceived success and failure. Changing the service ethos of the IT Department is about making the customer feel in control of the business, with IT providing services at their request and in an appropriate manner and language.

Remember that people (your service desk staff) provide the customer with the first impression of service and establish the baseline for service quality. People take ownership of issues and take action to avoid service degradation. People review trends in service performance and establish meaningful metrics. People also coach staff on performance to goals.

Too often service desk mentality sees customers and consumers of services as potential problem providers. The staff that man service desks respond to problems and incidents and are typically trained by and part of the IT infrastructure. The understanding of the business departments that the service desk supports is all too often very limited. This needs to be reversed with a high percentage of the staff in direct service functions having real knowledge of the business and IT management continually refining the support processes so that they are business driven.

The new V3 release of ITIL has moved much closer to embracing business value but it still uses acronyms and terms that the business does not immediately relate to. Delivering
service with a ‘human touch’ requires that the service teams embrace the business language and fully understand the needs of their customers.

What can be done to break down barriers between IT and other departments? IT can work to increase its status and humanise its approach. This doesn’t require a radical change of process. Instead, IT needs to interact more with its customers. I recently heard the relayed experience of the CIO of a large insurance company. He turned around the perception of the IT department, from abysmal to award-winning for service excellence within six months, with no extra money, new systems, nor the need to radically
change process. Instead, he mapped out the most influential business managers within the organisation and instructed his most customer-focused IT staff to visit them on a daily basis to check that they were being adequately supported.

As there are now several service desk tools that can claim to tick all or most of the boxes in relation to ITIL processes, organizations would do well to remember the primary reasons for their purchase: to improve the perception of IT service provision and increase
customer satisfaction.

If a SelfService portal is available to the customer, it should allow them to raise their requests in business only language, explaining the options and possibly costs in a way that makes sense. IT staff should also be aware of the services that are most important to the customer at the point when incidents are logged and requests prioritised appropriately.

Finally, the customer’s satisfaction level needs to be visible. Is the customer happy, or unhappy with the way their requests have been handled? This information prepares IT staff when interacting with the customer and enables them to offer a better service and focus on the human touch.

Situational Relevance in Social Networking Websites

Anyone who has spent a fair amount of time on a social networking website is familiar with the “what’s next?” problem. Put quite simply, “what’s next?” is what you say to yourself after you have exhausted the novelty of the service, and from that moment on you use the site less and less.

The answer, it turns out, is actually quite simple, and it deals with the concept of situational relevance. We all have many social networks: our primary social network, which is comprised of our close friends and family, and numerous secondary social networks, which may be comprised of coworkers, classmates, neighbors, fellow church patrons, teammates and so on. As our social networks are webs, the primary and the secondary nets all intertwine; regardless, we maintain separate identities for each.

Additionally, at different times in our lives, our primary and secondary social networks grow together and apart. For example:

* As youths, our primary social network grows very close to the secondary social network of classmates.
* As we enter adulthood, our primary social network moves away from the secondary social network of our classmates, and towards the secondary social network of coworkers and community relationships.
* As grown adults, our primary social network may move closer to the secondary social networks of PTA’s, church groups and neighborhood associations.

Of course, these lists are not absolute, just illustrative examples. At different times in our lives, different social networks play more or less important roles: they are situationally relevant.

From birth through adolescence and young adulthood, our primary social network expands continuously. Eventually, we settle; the incentives for primary social network expansion, such as partnering and friend aggregation, diminish. As we settle on a core social network, the secondary social networks step forward to serve the role of providing us a steady stream of new people to meet (sustaining a human need for sociality). Just as “the new kid” was a remarkable event in grade school, the new neighbors down the street and the new vocal parent at the PTA provide us with later-life social network renegotiation that we all find interesting.

Regardless of how it is spun, all social networking websites rely on users to fuel the interestingness of the system. Users know that the websites are only as interesting as who is on them; that is why social networking website users often become advocates to non-users. However, once everyone is on the website, the users are posed with a quandary: “what’s next?” We know what happens to traffic after that point.

The actual problem is not that users are tired of each other or the sites are faddish (common explanations); it is simply that the users no longer need the website’s service. Take the case of Friendster: Aimed at a mid-to-late twenties demographic, Friendster positions itself as a way for people to visualize and expand their primary social network. The problem, of course, is that an average Friendster user has long established much of his or her primary social network. If the average user is not frequently or drastically changing his or her primary social network, a site that seeks to aid in that role is actually not useful. Visualization and exploration of a social network is simply not enough.

Let’s bring situational relevance back into the picture. In the context of social networks, situational relevance of a social networking site is based on 1) the demographic it attempts to serve, and 2) the social network it attempts to map. While it is almost always interesting to view social networks (for example, conducting a time-to-time investigation of ex-classmates on, to create real value, a site must be positioned properly. To do so, the site must address the social network, primary or secondary, of a demographic where that social network is relevant and in flux.

Facebook may be the best example to date of synergistic situational relevance. Facebook addresses a secondary social network (classmates) that is, at the time, closely tied to the primary social network of its demographic (college students). College students spend 4 years constantly in flux, each semester meeting new people and dynamically shifting their primary and secondary social networks. For the college student, their world is largely the campus; the Facebook provides a constant companion as they navigate the college experience. For this reason, I believe that the Facebook, as long as it continues to serve the core information needs of the students (by continuing to give them interesting ways to explore information about each other), will continue to stay relevant on college campuses for a long time to come. Of course, poor marketing or unpopular business practices could diminish the brand; nevertheless, students will always find a service like the Facebook necessary and useful, because it answers student’s social and informational needs.

I hold Facebook up as a shining example, of course, because it is the service that best fits my criteria of situational relevance. LinkedIn, the popular business networking site, is an example of a site that addresses a secondary social network of a relevant demographic. However, LinkedIn is not nearly as popular as Facebook. Unfortunately for LinkedIn, the only time people strongly rely on their personal-professional secondary social network are in times of need. When someone has a comfortable job, there is limited incentive to invest much time in a site like LinkedIn. While LinkedIn serves a real need, its users will never be simultaneously vested in the system the way Facebook’s users are.

Now let us look at Friendster and MySpace, two sites that attempt to serve the primary social network of a wide demographic. Friendster and MySpace eschew situational relevance, opening up the door to all comers; as a result, both are faced with the “what’s next” problem. Friendster did not successfully deal with this problem; MySpace, by properly leveraging the userbase’s media interests, is in the process of a transformation. Both sites effectively realized that leveraging non-dynamic social networks eventually lead to burnout, or “what’s next?”

Addressing secondary social networks of relevant demographics may seem formulaic, but it requires changing attitudes towards the ways websites support social networks. For example, residents of a neighborhood, whose primary social network do not change, are interested in the constantly changing secondary social networks that comprise their neighbors. Church members, again, whose primary social networks do not vastly change, are very interested in the constantly changing secondary social networks of their fellow worshippers. These networks are large, personally relevant and dynamic (new neighbors move in, new worshippers join the church, families expand and change, etc); unfortunately, simply setting up or is not the answer.

Secondary social networks do not benefit from economies of scale. That is, simply because I am interested in my fellow neighbors, I am not interested in all neighbors everywhere, nor do I wish for all neighbors everywhere (a secondary social network that may encompass many of my social networks) to be able to see my particular identity in that social network. In each social network, we possess a unique identity; this is why the Facebook works. In the Facebook, students can retain a particular identity without worry of everyone (parents, siblings) being privy to that identity. In essence, the vast, untapped secondary social networking market is comprised of semi-open (gated) secondary social network communities.

Imagine gated social networks for parents of students at a school. Imagine gated social networks for the in-flux neighborhoods of a place like Cary, NC or Northern Virginia. Imagine a gated social network for church members, for employees of a company, for adults entering retirement living. All of these cases, and the many more like it, involve in-flux social networks that the relevant demographic is personally vested in, where they have strong incentive to participate. Since these secondary social networks are gated, users are comfortable the way college students are comfortable in the Facebook.

Of course, there are difficulties that come with this model. The Facebook gets off easy by limiting access by email accounts; they let the universities do the gating for them. Gating churches and neighborhoods are harder, but how much harder? I can think of a number of solutions off the top of my head; if a business could solve this problem elegantly, there’s no limit to the secondary social networks that can be augmented by websites. In a sense, this is the perfect long tail, and everything that is right about Web 2.0. There’s gold in them hills, people. Now go get it.

CEOs make in a day what workers do in a year

The typical CEO of a top U.S. corporation earns more in a single workday than the average American takes home in an entire year. And there’s no sign that the gap is getting narrower.

A new study by the Institute for Policy Studies and Boston-based group United for a Fair Economy found that the CEOs of the 500 largest U.S. companies took home an average of $10.8 million in total compensation in 2006.

That’s about 364 times that of the average American worker, who earned just $29,544 in the same period.

The top 386 CEOs also enjoyed perks worth an average of $438,342 in 2006. A minimum wage worker would need to work 36 years to earn as much as CEOs obtained just in perks last year, the study found.

It’s a similar story with pensions. CEOs retire with an average $10.1 million in their retirement plans. In contrast, barely more than a third of American households headed by an individual 65 or older held any type of retirement account in 2004 and those accounts that did exist averaged only $173,552 per household.

For those at the top of the 20 largest companies in the U.S, however, the rewards were even greater, averaging $36.4 million. This figure is three times the average of $12.5 million earned by the 20 highest-paid European CEOs.

In comparison, members of the U.S. executive branch of government averaged just $198,369 and generals in the U.S. military $178,542.

“Individuals who sit atop America’s business enterprises are capturing far more compensation for their labors than individual leaders in other fields who appear to hold the same exact leadership skill set,” the report argued.

Yet CEO pay pales in comparison to the sums earned by those in the most lucrative jobs in the U.S. The average compensation for the mangers of the country’s top 20 hedge funds was an eye-watering $655.5 million in 2006, with four having earned more than $1 billion in the last year alone.

Sam Pizzigati of the Institute for Policy Studies said that these huge pay gaps could cause real problems because they drained leadership talent out of the government and not-for-profit sectors.

“The soaring pay gap between business executives and elected leaders in government essentially makes corruption inevitable,” he added..

“With such huge windfalls at stake, business leaders have a powerful incentive to manipulate the political decisions that affect corporate earnings.”

Sarah Anderson, lead author of the study, added that despite changes to the reporting regulations that have made it difficult to compare this year’s CEO-worker wage gap to previous years, it is clear that the overall trend has not changed.

In 1965, U.S chief executives in major companies earned 24 times more than an average worker. In 1980, the ratio was 40-1. The gap then surged in the 1990s and hit 300 at the end of the recovery in 2000.

“We certainly haven’t seen any real retreat on CEO pay,” Anderson said. “Even companies that are heading toward crisis are continuing to pay huge sums.”

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