Archive for March 2007

Outsourced work plagued by cost overruns, underperformance: survey

Here is a very interesting article from Channel News Asia about outsourcing.

Outsourced work plagued by cost overruns, underperformance: survey
By Jeana Wong, Channel NewsAsia | Posted: 19 March 2007 2028 hrs

SINGAPORE : The practice of outsourcing has not really brought in its much-touted benefits for companies, according to Deloitte Consulting’s latest outsourcing survey of 280 of the world’s biggest global firms.

The survey revealed that outsourced work have been plagued by underperformance and cost overruns, leading companies to start counting beans and to manage such work proactively.

To prevent costly mistakes, legal and accounting experts suggest that companies examine their own processes and think hard about exit strategies.

Outsourcing has been a popular catch phrase among companies looking to cut costs by hiring external parties to provide specific operational services.

But a Deloitte survey has found that outsourcing itself could lead to more staffing and tweaking of the services than expected.

And this ironically raises costs and eats into any expected cost savings.

“Typically, for organisations that outsource, they might have variations in terms of their practices across different regions or perhaps different operating companies. These different practises would mean that they are not able to accept the standardised solution offered by a vendor in a wholesale manner,” said Phua Jer Hong, regional practice leader of Strategy & Ops Advisory at Deloitte Consulting.

“In other words, the majority of the organisations have yet to realise the cost savings that they are originally entailed or have identified in their business case. They are also putting in place a larger-than-expected retained organisation to manage outsourced vendors, as well as to manage the outsourcing deal itself.”

Rather than being fixated on cost savings, Deloitte suggested that companies think of outsourcing as part of their overall business strategy.

For instance, a company entering a new overseas market could outsource its human resource operations. This would turn what would have been fixed costs into variable costs.

Companies could also transfer their risks and liabilities if they outsource non-core operations like disaster recovery.

Deloitte said companies could also start by centralising and standardising their own processes first before outsourcing what they identified as their non-core functions.

While there are many benefits from outsourcing, legal experts say companies will need to figure out their exit strategies right from the outset, so they are better prepared during transitions or when the relationship with an outsourced partner sours. This is especially if in-house staff have been transferred over to work with the vendor team.

“When you are in a transition out, make sure you think about where these employees are going to go and how you are going to downsize the relationship. Employees for certain jurisdictions in certain countries are, of course, a very political issue, a public relations issue, so you want to make sure you get this right from the outset,” said Chin Hooi Yen, associate director of Gateway Law.

“The other thing is intellectual property. You want to ring-fence your IP and protect it throughout the relationship. And when you exit, you’re still in control of your intellectual property, and not left it in the control of the vendor.”

Of the 70% of respondents in the Deloitte survey expecting cost savings from outsourcing their work, nearly 40% had paid extra or hidden costs for services they believed were included in their contracts.

In the same survey, nearly two-thirds of respondents who outsourced have brought those services back in-house. – CNA /ls

So anymore top management people still want to outsource?

Which university did you graduate from?

Continue to help setup the new PC for some of the colleagues who are on leave on Friday.

So as usual, I connect the new PC to a network point, help my colleague map to the shared drive and ask them to copy their data to the new PC.

Then one colleague asked me this question:

“So I copy everything in C drive to the new PC C drive huh?”

WTF….. For goodness sake, if this question is being asked by someone with non-IT degree, I can still understand. But this fellow has an IT degree. Does he has any basic IT knowledge? You just need to copy your data over. Your software need to be reinstalled onto the new PC manually. It will not work if you just copy your program folder over to the new PC. This is basic IT knowledge that even non-IT people would know. Does he really have a IT degree or is it bought online?

And my reply to him was:

“Which university did you graduate from?”

—————

Few hours later, another colleague walked pass me and saw me setting up PC for other colleague. He came over and had a short chat with me. He said that being a LAN admin in a IT dept is actually quite an easy job since everyone here has a IT diploma or degree.

I told him that story and both of us laughed for 5 seconds before continuing our work.

————–

I know, I sound rude. No matter how stupid the question is, I shouldn’t be insulting the person by asking him which University he grad from.

But it is the same person who didn’t restart the job, didn’t setup the laptop, anyhow promise deadline, didn’t inform us till last minute, arrow me to cover his meeting and give excuse saying he don’t know.

I think heaven will forgive me for being so rude.

Not my type of retirement

Recently, I begin labeling some of my colleagues as people with “Retiree Mentality” (RM). These are people who are in the company waiting for retirement. They are unwilling to put in extra effort, go by the books and unwilling to take up changes.

People with RM in my company are all perm staff. They are always scare of doing things that has never been done. They follow the rule book and unwilling to make slight changes for special cases. They don’t know a lot of things and are unwilling to learn. They don’t want to do too much as doing too much means more chances of making errors. They are afraid to make mistakes. They are just there waiting for time to pass and waiting for their retirement.

There are many characteristic of a RM person. These are just few of them. And sad to say, some of the RM people in my company are holding high position like Directors and Team Lead.

This is not my type of retirement. I don’t want to find a secure job and work till I’m too old to work. I want to be rich enough to stop working before I reach the retirement age. I want to get out of the rat race, to earn enough passive income to pay my bills and have enough to live a good life. Its not easy to reach that stage, but not impossible.

But I’m not heading towards that direction. In fact, I don’t even know what direction am I heading. But I know it’s the wrong way.

Me LAN Admin

Our company bought 27 new PC lately. One of them is for me!! :D
Its about time they upgrade my PC. I’m on a 1.6ghz, 256mb PC. Its still alright for normal duties. But when there is a large list to vlookup or I need to use jbuilder, this machine crawls.

As I’m the LAN Admin on duty, I have to help setup the PC. So there are quite a lot of PC to setup, I decide to do 3 at one go. Could had gone more if the space allows.

The whole thing feels so like the days before my Poly when I was doing parttime job as a trainee technician. Setting up PC like a factory worker at a mass production line. Everyone who walk passed me will go “WAH” or “WOW”.

After setting up, I need to get the new pc owners to transfer the data from their old PC to the new ones. At first, I wanted to pull the harddisk from the old PC and plug it to the new PC. But then, the old PC’s HDD is on IDE while the new PC is on SATA.

So the only option is to use network to transfer data. Slow, but better than nothing. So with a borrowed hub and power extention cable, I set up some of the new pc on the floor. Using 1 monitor, mouse and keyboard, I connect the new PC to the network one by one, share the drives and get the users to transfer their data.

It is an interesting sight.

Corona Beer Freezing Trick

Put a Corona beer in the freezer for 3hr, give it a knock and it “freeze instantly”.

Cool. Should work with any other beer right?