The NOA “Reputation of Outsourcing” Seminar: the year that was and the road ahead

Thursday 9th December

As the year comes to a close, the NOA’s “reputation of outsourcing” seminar was held with the aim of discussing outsourcing’s media presence over 2010, identifying key themes and topics of the past year and looking at predictions for 2011.

Will Arnold, Research Director, Apollo Research, was the first speaker at the event and provided an insightful presentation on the media’s influence and presence over the past year.

Will said: “This has obviously been a very eventful year for outsourcing. We were commissioned by the National Outsourcing Association to look at outsourcing growth in the media, understand its influence and research the perceived concerns over the past year. In order to do this we looked at over 13,000 stories in the press across nationals, regionals, industry titles and general business media.”

It was no surprise that outsourcing as a topic has seen rapid growth in 2010. Its growth in coverage was up 117% in the latest quarter compared with the first quarter through blanket coverage of business and general audiences.

The increase in outsourcing media coverage was attributed to:

• Public sector

• Various suppliers

• Outsourcing as a concept

• Cloud

• China

• Shared Services

• Cost-savings

• Agility / Scalability

• Efficiency

• Security

Cost savings were the main reason for positive coverage in the media and fears over job losses attracted the most negative coverage.

Will said: “The public sector, cloud and a focus on winners and losers will be the hot topics of 2011 although there will also be an increase in other themes such as shared services, manufacturing, China, pay and conditions along with a focus on the competitive advantage which is given to end-users.”

“It seems that the main underdeveloped issues in outsourcing are proof of value and research on the economic impact of outsourcing in the UK where arguments tend to be undeveloped and one-sided.”

John Willmott, Managing Director, Nelson Hall, followed on the discussion with comments on the big outsourcing themes of 2010 and predictions for 2011.

John said “I think that the main outsourcing drivers for 2010 have been cost reductions, the public sector and the improvements which have been made in the customer experience. Along with the increase in multi-channel strategies, businesses are being more selective about their outsourcing partnerships, which has led to an increase in multi-shoring. I have also seen an increase in shorter deals due to business uncertainty along with an increase in contract flexibility and transparency.

“Cloud will remain the hot topic for 2011 due to the promise of cost savings and the ability to ‘pay for what you use’. Offshore destinations will continue to make near-shore and onshore acquisitions which is good news for the UK jobs market. Job creation will also be a very important factor for many local government contracts.”

A panel of experts led the discussion for the remainder of the seminar. The panel of seven was comprised of:

• Will Arnold, Research Director, Apollo Research

• Kerry Hallard, Communications Director, NOA

• Chris Halward, Programmes Director, NOA Pathway

• Rex Parry, Partner, Eversheds

• Andy Rogers, Board Member, NOA and Senior Project Manager, National Grid

• Peter Skyte, National Officer, Unite the Union

• John Willmott, Managing Director, Nelson Hall

The discussion touched on various topics and predictions for 2011 including the continual dominance of offshoring, public sector contracts and shared services. Contracts will continue to flexible and more transparent along with multi-sourcing becoming more commonplace.

A lot of emphasis was placed on the human implications of outsourcing. The economic times, spending cuts and people heavy processes have all contributed to job losses being the number one cause for negative coverage.

Peter said “Relationships are the critical key component in any organisation. Outsourcing could and should not be just about cost-savings. People issues need to be addressed and discussed in plenty of time when there is a real risk of possible causalities.”