Wednesday, November 19, 2008

Outsourcing Reporting Function - Smart Decision

Large organizations with huge reporting requirements have been traditionally outsourcing the report production services. Report production is considered non value added. The basic analysis of the reports are also outsourced, so that the organizations don't waste their valuable resources into these routine mundane activities. To illustrate, Nielsen does reporting function to large corporates in US through their ACNielsen Retail Measurement Services

If reporting function can be outsourced, why do some large corporates still do these functions manually, internally deploying their knowledgeable resources? Is it not beneficial to have these reports done by companies such as Nielsen while the corporates focus on analyzing reports and making meaningful decisions.

GE used to enforce six sigma rigor on their IT suppliers, forcing them to reach above 4.5 sigma still maintaining costs. Similarly, corporates could force the outsourced vendor to automate reports over time and then in-source them or have it outsourced for a fraction of the original cost when they used to be manual task.

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