Considering financial markets and economics, businesses are now looking within to find ways to cut costs to stay competitive. The race to stay competitive means everything is on the table for discussion and reform. Traditional thinking and old ways need to transition into new and innovative ideas to meet the challenges faced by businesses.
Elements of a business that are not an integral part of core competencies should be viewed as candidates for outsourcing if there are clear-cut business benefits to be gained in terms of efficiency, productivity and organisational effectiveness. Managed services aren’t about moving jobs. It’s about the flexibility to put resources in the right place at the right time.
Organisations benefit from managed services in several primary ways:
- The quality of processes are dramatically upgraded, improving productivity and efficiency while reducing costs.
- Valuable staffing, technological and financial resources are refocused on mission-critical core competencies that are dedicated to generating a competitive advantage in the marketplace.
- The trimmed-down organisation is much more agile, which enables it to respond more quickly to changing internal and external conditions.
Outsourcing continues to grow in traditional back-office areas like accounting, human resources, data processing, security, call centres and IT management.
“Ninety percent of companies say that outsourcing is an important part of their overall business strategy.”
Michael F. Corbett, The Outsourcing Revolution
Records and Information Management (RIM) for the vast majority of businesses are non core business functions. They are support functions which do not directly derive income but are a diversion of resources and focus attention away from the organisation’s mission critical activities. This makes a strong case for considering managed services for these important non core business functions.
As organisations struggle with the task of managing the masses of business content generated on a daily basis, they need to ensure that the strategy in place efficiently manages records and information without putting the organisation at risk.
RIM is often seen as an unnecessary or low priority administrative task that can be performed at the lowest levels within an organisation. Those organisations that poorly resource or poorly manage records management programs make the performance of duties more difficult, cost organisations time, money and resources, and makes them vulnerable to security breaches, prosecution and embarrassment.
RIM processes are extremely pervasive, making it difficult for organisations to develop a true picture of all of the costs involved in terms of staffing, technology and work processes. It often dissuades senior leaders and managers from considering the possibility of a managed services solution at the enterprise, business process or line of business level even though a careful analysis will show that there are clear-cut business benefits to be gained.
While most organisational executives may never have considered managed services for these non-core functions, the fact is that switching to managed services for such activities is now not just possible but in some cases preferable to performing them in-house. These managed service are secure, highly reliable and easily accessible over the Internet.
Organisations that outsource RIM business processes frequently identify concrete, measurable improvements in five key areas:
Business Process Improvements
The above benefits can increase organisational efficiency, speed up the flow of information, improve compliance and reduce risks and costs. Managed service can provide a strong foundation for a total information management strategy that facilitates the shift from a labour intensive, physically oriented environment to a strategically focused environment that centres its attention on core competencies.
"Whatever specific reasons a company may have for outsourcing, the underlying principle is a conviction that astute companies share: To stay competitive they must outsource non-core aspects of their business. Because each partner brings its "core competence" to the effort, it may be possible to create a best of everything organisation. Every function and process could be world-class - something that no single company could achieve".
Consider these questions when deciding whether outsourcing RIM is appropriate for your organisation.
- Are your RIM business processes core competencies that deliver a unique value to your customers and stakeholders?
- Are your RIM processes central to your organisation’s mission?
- Is your approach to RIM based on a sound strategy designed for optimisation instead of a “we’ve always done it this way” management philosophy?
- Do you know the true cost of all the resources (including staffing, infrastructure, technology and processes) that are devoted to RIM throughout the organisation?
- Are you satisfied with your organisation’s current approach to RIM in terms of efficiency, cost, quality and ease of management?
- Do the people involved in RIM have the right skills to support your strategic and tactical goals?
- Could RIM managed services reduce your costs, risks and improve your organisational flexibility and agility?
- Could your organisation benefit by reallocating the resources currently invested in RIM operations to more mission-critical tasks?
- Are there redundancies and inefficiencies in staffing when you consider all of the people involved in RIM at both the corporate and line-of-business levels?
Answering “No” for any of the considerations numbered 1 to 6 or “Yes” for any of the considerations numbered 7 to 9 may indicate that outsourcing RIM is appropriate for your organisation.
The ultimate test of whether RIM managed services makes sense for your organisation is whether you will experience significant improvements in the quality, efficiency and cost-effectiveness of your RIM operations.
If you are able to assess the total costs of your current RIM operations, which may currently fall short of benchmark standards in terms of strategy, workforce capacity, technology and processes, you will see that a RIM managed service is, at the very least, an important topic for your organisation to consider. A careful analysis may indicate that a RIM managed service will help you reduce costs, increase productivity and efficiency, optimise the allocation of resources and sharpen the focus on your core competencies regardless of the scale of the implementation.