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Volume 32, Issue 3

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Wednesday, 21 November 2007 00:28

How to Keep Your Organizational Reality from Sabotaging Your Outsource Strategy

Written by  Pamela Harper

As companies look for new ways to grow in an unstable economic climate, strategic outsourcing, the strategy of outsourcing entire business functions, is gaining popularity. However, there’s more to successfully executing an outsourcing strategy than meets the eye. On the one hand, having suppliers and contractors handle entire functions from research and manufacturing to accounting, human resources, sales and information technology services can accomplish a variety of business objectives while enabling you to control costs and quickly respond to the rapidly changing marketplace. However, executives often overlook thinking through and planning for critical organizational reality implications at the earliest stages of considering this approach. The result is often a phenomenon that I call “strategic gridlock”: persistent organizational problems that can pile up and cause the company’s progress to grind to a halt. Consider the case of “Company A“, a technology company that decided to outsource their manufacturing function. This strategy should have