Learn how our Managed Operations model provides the perfect middle ground between outsourcing and incorporating.

talk expert
Talk to
an Expert

Explore the opportunities with us.

Contact Us

Clients Miss Opportunities as They Focus Too Much on SLAs

by: Sarah Joson

Wednesday, June 1, 2011 | Outsourcing News |

Business Strategies Overlooked?

A recent study done by Accenture and Shared Services and Outsourcing Network (SSON) stated that outsourcing providers and clients are mostly consumed by service level agreements (SLAs) and are forgetting business strategies in contracts.

Forty-two percent (42%) of the 600 respondents said their time is spent discussing SLAs rather than business outcomes. On the other hand, 25 percent said they used to do the same thing but have changed the process.

According to Tom Pettit, managing director of North America business process outsourcing at Accenture, although SLAs are vital for IT and BPO contracts, they can also confuse both parties from future developments. "SLAs are an important part of any managed service engagement. They set expectations and necessary service performance targets. However, the overwhelming majority of SLAs are focused on measuring process inputs, rather than business outcomes."

Cutting costs may be the driving force for clients and providers to overlook operational metrics. Fifty-eight percent (58%) of the respondents said they outsource work because they wanted to cut costs, 19 percent did it because they wanted access and capacity, and 12 percent did it for risk reduction.

It is also stated in the study that most of the outsourcing customers fail to gratify some members of the management team, which has become a problem. "The centralization of services, whether in an internal shared services model or in an outsourced model, involves shifts in power and influence, changes in roles and responsibilities, and disruption of familiar ways of working. These are notoriously difficult and often deeply personal issues that require focused and sustained management attention over extended periods of time," said Pettit.


Post a Comment

Security Image:

 function captcharefresh button


Email Address: (will not be published) (required)