How do you keep IT outsourcing knowledge flowing?

Most of us look and try to recommend cost effective model, sure that is one of the key factors that is also mentioned above however should we not look at skill and experience? Having a team that is skilled, qualified and experience, most of the time adds lot of value when we look at expansions and take critical decisions. And this definitely comes with a price but can be made cost optimum by looking at year on year contract and ROI. For the right outsourcing model right contracting and its set of ROI is key.

As a financial analyst deeply involved in big outsourcing deals, I have come to realize that the key to success lies in ensuring a seamless flow of IT outsourcing knowledge. Over the years, I have used a mix of strategies to enable the constant exchange of knowledge in the outsourcing arena. I list below the key elements: 1) Cultivating a Learning Culture 2) Regular Knowledge Sharing Sessions 3) Utilizing Online Collaboration Tools 4) Encouraging External Networking 5) Collaboration with Outsourcing Partners 6) Documentation and Knowledge Repository 7) Continuous Learning and Training By implementing these strategies, I have seen myself and my team grow more informed, confident, and capable of making well-informed decisions.

Choosing the right outsourcing model depends on various factors. Staff augmentation is suitable for short-term needs, akin to a tech startup needing specialists for a specific task. Project-based models, such as when the Commonwealth Bank of Australia outsourced its IT infrastructure to EDS, focuses on specific objectives. The dedicated team model fosters collaboration, like Spotify's "Squads" model, where specific teams focus on particular product aspects. Managed services, demonstrated by a fintech company delegating IT operations, allow a complete focus on core business functions. Aligning the model with project specifics ensures an effective outsourcing experience.

A RASCI matrix is vital to any outsourcing engagement, and knowledge management should be clearly covered, this is not usually given the right focus, contributing to issues in service quality and more importantly a more challenging transition out phase. A knowledge champion is an important and ongoing function, which should be reflected in both organisations.

Defining roles and responsibilities streamlines project execution. For instance, at NASA, each team member, internal or external, knows their exact role, minimizing confusion and ensuring no aspect is overlooked. Similarly, Apple assigns a project manager to each team for streamlined coordination and communication. Lastly, Google's OKR (Objectives and Key Results) system, which sets clear expectations and standards for each employee, and tracks their performance, can be mirrored when managing external teams. This process, complemented by regular feedback and recognition, ensures smooth project delivery and optimal knowledge flow.

It's important to select the right communication tool and methods that support knowledge management to avoid inefficiency and focus on the value gained.

Effective communication is key for knowledge flow, especially in a distributed team setup. Companies like Twitter and Shopify utilize communication tools like Slack or Zoom, depending on their needs. Email, phone, video conferencing, chat platforms all aid in facilitating smooth dialogue. For instance, Atlassian, a project management software company, leverages tools like Jira and Trello to manage tasks. Establishing a communication plan, akin to how NASA coordinates missions, ensures structured updates. Additionally, using a common language is crucial in global projects, like when Airbus assembles planes using parts from various countries, avoiding misunderstandings through standardized terminology.

It’s important to know the governance structure and how to execute. Bringing in right people for right priorities are key to successful operation . Often we miss out to know and understand what are our priorities and how to execute them . Governance is key !

Ensuring a documentation process that addresses the handover of new projects and keeping documentation current for the existing will make this more effective in the long run.

Documentation facilitates knowledge flow, as seen with Microsoft, where comprehensive documentation helps in effective collaboration with external partners. Sharing project requirements, code, tests, etc., similar to how open-source projects like Linux maintain transparency, ensures everyone is on the same page. Using a centralized knowledge repository is crucial, just as GitHub does for code versioning, offering easy access to all project-related information. Furthermore, following documentation best practices is key. For instance, companies like IBM place importance on clear language, comments, and accuracy, which aids in ensuring consistency across diverse teams.

This will depend on the model of outsourcing, and in large managed services outsourcing training and support is the responsibility of the outsourcing partner. Hence, it is important to ensure the outsourcing partner has a training and support plan as well as a process to identify knowledge gaps.

Training and support are pivotal for knowledge flow, akin to how Google provides extensive orientation for its new hires or "Nooglers". This helps familiarize the outsourcing partner with the business and goals. Regular training, as practised by Salesforce, ensures everyone is updated on project changes. Providing support is also crucial. When IBM deployed its AI platform, Watson, at Memorial Sloan Kettering Cancer Center, extensive training and support ensured the system was effectively integrated. Similarly, when Boeing outsources parts of its aircraft manufacturing, they offer significant technical support to ensure the standard is met, thus resolving any potential difficulties.

Evaluating and improving knowledge flow is crucial, like how Amazon continually assesses its operational efficiency. Measure knowledge flow using metrics such as quality or timeliness, as done by Tesla in their manufacturing process. Soliciting feedback is also key, like Airbnb's practice of constantly collecting and analyzing user feedback. SurveyMonkey and Google use surveys and interviews to get insights from both internal and external teams. Implement improvements as well. For example, Toyota's famous Kaizen philosophy of continuous improvement, or Spotify's innovative "guilds" system to share knowledge, can serve as inspiration for improving your knowledge flow processes.

In my experience, it's not so much about the model but rather the intent behind outsourcing. Skills, cost and efficiency are the major drivers. Whatever the intent, the outsourcing provider must be considered as a partner and knowledge management should be one of the primary criteria in the selection of the partner. The relationship the business has with the outsourcing partner will determine the quality and efficiency of the business. While there are many factors, this in my experience is one that is sidelined in many cases. I'm against the terms internal/external teams in partnerships, as a true partner is the one that has your best interest; this is bidirectional.

IT outsourcing, a strategy used by businesses like IBM to access specialized skills, can reduce costs and increase efficiency, as seen with Apple's outsourcing of manufacturing. However, it can bring challenges in managing communication, quality, and knowledge transfer. Ensuring seamless knowledge flow, akin to Microsoft's collaboration with external partners, involves clear communication, as employed by Twitter with tools like Slack, comprehensive documentation as practiced by Linux, proper training like Google's orientation, and continuous evaluation, following Amazon's efficiency assessment. This balance of strategies ensures successful integration and collaboration with external teams.