Outsourcing in Project Management

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Combining strategic outsourcing and project management

By: Rajagopal, Shan | Mobley, Michael

With the coming of the millennium, organizations are continuously examining ways to gain a competitive edge and companies in every industry have begun to take a closer look at their support operations. Customers are demanding more when it comes to quality, value, timeliness of performance and price. To effectively compete in such a market, organizations must provide top-notch products, processes and services; remain focused; and have the ability to offer competitive pricing and quick response services. To do this, they must maintain the staff as well as the expertise. This can be a monumental task for any organization and, given the ongoing labor shortage, finding and keeping in-house experts can be expensive.

One increasing popular option for businesses striving to compete in an ever-changing marketplace is outsourcing one or more non-core activities. The successful outsourcing organization concentrates on key activities and hires “experts” to provide the rest. This does not decrease the ability to manage those functions; it simply allows organizations to be state of the art in all areas by partnering with professionals in non-core functions. This trend, predicted to continue into the next century, can be a cost-effective alternative that provides multiple benefits to employers. In addition, once seen as a high-risk strategy adopted only by companies in trouble, outsourcing is now being recognized as a powerful management tool not only to reduce operating cost but also provide strategic benefits to organizations.

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Outsourcing project management services

By Rao, Raju

Historically, the outsourcing industry has seen considerable growth from the information technology (IT) sector. This gave rise to business process outsourcing and now knowledge process outsourcing. Can project management services be outsourced? Surprisingly, this concept is still in its infancy. Judging from the growth in outsourcing of other business processes there seems to be very good opportunity for project management outsourcing.

A majority of processes project management outsourcing that could be outsourced are those for project control. The concept could be understood in terms of various structures, roles, and models. Although it has some advantages there are some challenges as well. For example, an organization interested in maintaining its focus on its core competency could benefit from it. At the same time there could loss of control or threat of loss of sensitive data.

Some organizations have successfully outsourced their project control functions to outside vendors. The main challenges in the growth of project management outsourcing is in accepting project control as a separate function and in delegating this to other departments or vendors. Although some sectors have a separate structure of project controls in place this is not prevalent in many organizations. There is need for increasing awareness and sharing of best practices by different sectors on this subject.

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Managing outsourcing projects for success

By Hehl, Mark C.

Many companies run into trouble when they shift work offshore, but they usually persist since this process is critical to corporate success. This paper explores this ever growing trend and will help the audience avoid the common pitfalls when outsourcing. A proven formula for project success will be outlined here. This is based upon the writers many years of experience in moving and managing various projects in both Asia and Latin America coupled with long stays on the ground at various overseas locations.

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The project component of an outsourcing engagement

By Wiswell, Jan

The outsourcing engagement includes four phases: define, design, develop and deliver. The define, design and develop phases of the engagement fit the definition of a project. Collectively they are a temporary endeavor undertaken to create a unique service. The project scope includes: defining requirements; designing a solution; developing the processes, procedures, tools and application software needed to implement the service. The delivery phase is the service, which becomes the day-to-day business processes. Delivery falls outside the scope and definition of a project. The project manager is engaged for the duration of the contract even through the delivery phase, as new projects are defined during this phase.

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