Value Based Outsourcing. Clear linkage between your outsourced resources and business performance.

When you outsource a business function, whether I.T. or business process, you want lowest cost but you also want leveraged business performance, an infrastructure that facilitates (not constrains) business agility, and a low cost of doing business with your supplier. In other words you want tangible added value. But adding value is really hard.

What are the Benefits

Assures a strong & clear linkage between your outsourced resources and business performance by:

• Optimising value from your existing programmes.
• Identifying latent value and assessing ROI potentials.
• Simplifying decisions surrounding investment priorities.
• De-scoping programmes by focusing only on the top value drivers.
• Preemptively tracking all benefits in terms of 'value in progress', value delivered and value 'at risk'.
• Optimising the unit cost of your outsourced resources.
• Minimising constraints to business agility from your outsourced resources.
• Providing a strong, clear Value based framework for managing your supplier relationship.

So, What is Value Based Outsourcing?

When you outsource a business function, whether I.T. or business process, you want lowest cost but you also want leveraged business performance, an infrastructure that facilitates (not constrains) business agility, and a low cost of doing business with your supplier. In other words you want tangible added value. But adding value is really hard and the work of Jeff Thull at Prime Resource explains why:

"A complex world means its difficult to assess the nature and degree of the business problems you must resolve and the complexity of the services/technologies that will provide the solution. And some are not well equipped to understand and manage the organisational change issues - and only 'Change' delivers Value. Finally, some may not have the ability to measure and recognize the incremental value provided by the solution supplier.“

VBO overcomes these barriers - and it does so by combining the capabilities of our approach to Value Management as embodied by our Value Lifecycle Management services with the ability to track your Supplier's performance across a range of strategically important areas. This means that it is now possible to leverage your outsourced resources by ensuring that your supplier is always focused on the strategically important issues and is managed and paid on the basis of value delivered rather than inputs provided.

What will it deliver?

VBO will provide you with the following:

• It gives you the ability to locate, scale and clearly articulate business value and then tell your supplier what you want in terms of clear, measures based outputs. In other words - it gives you control over what your supplier is doing without prescribing the solution.
• It allows you and the supplier to understand and agree upon the value to be delivered and how it will be tracked
• It measures the performance of the supplier across a range of strategic issues so you are never in the position of paying for something you have not received.
• It guides both parties to adopt the right behaviours needed to secure agreement on what is valuable and how best to deliver it.
• It dramatically reduces contractual disputes
• It will prevent your outsourcing contract becoming a 'straight-jacket' and transform it into a powerful tool supporting your strategic objectives