The flip side of the collaboration coin I believe is outsourcing because the outsourcing model definition is a client engaging or contracting with another party to provide services. When I think about the outsourcing model I think of it as a type of client / service provider relationship or engagement. Where the collaborative partnership model is based on developing a mutually beneficial relationship, on the opposite of the spectrum I believe you have the outsourcing model of pay for services. Theoretically both of these models can coexist within one overarching model. There are, however, pitfalls to both models that must be recognized and accounted for so that the greatest value is derived for the organizations’ customers.
I see the collaborative partnership model as very closely aligned to deriving value for the organizations’ customers. The partners in this model are focused on two types of customers; their direct customer and their partners’ direct customers. This can be a very powerful model in the business world because this focus on the customer then will extend from the beginning to the end of the supply chain, or the business relationships. This focus doesn’t just miraculously occur, it must be measured continuously across the partnership in order to maintain and derive value. This measurement must be carefully monitored and nurtured across the partnership because this becomes the life blood in maintaining a robust partnership.
This cross functional measurement is a very important concept that I believe is overlooked in many if not most outsourcing engagements until it is too late. I think that this oversight is due to the client / service provider, or pay for services, type of relationship. I believe there is a tendency to focus on cost reduction in outsourcing relationships, to the detriment in many cases to the organizations’ end customer. The danger of this type of model is what I would call death of a thousand cuts because your service to the customer degrades bit by bit, each time without ‘significant’ impact to the customer until you reach the point of no return or significant business loss. This customer failure while then cause a flight of customers to other options. A monopoly of service or product can mask this failure and actually cause unforeseen options to develop. Remember there is always an option, no business is every a complete monopoly and their disregard for the end customer because they believe there is no other option will contribute to their eventual failure.
Cable service providers are I believe a classic example of outsourcing run amok without regard for the end customer. I recently moved and am in the midst right now of working with Time Warner Cable ( #TWC ) to install new service. For my personal experience this has become a spectacular failure in customer service that is the direct result of outsourcing run amok. The issue that I see is that each silo within the organization wants to help the customer and portrays this desire to the customer, however there is no accountability, or organizational follow through across the silos and outsourcing organizations. I have been told no less that five times by fives different representatives that they will resolve my issue that they have submitted my request for resolution and someone will call that day, or within the hour even, to confirm the resolution and guess what, the only return call that I have received to-date was the recorded ‘you have an appointment’ message.
And now for the audience participation portion of the show…
Have you discussed definition and measurement of standard metrics with your collaborative partners? What methods have you identified and incorporated to encourage participation? Have you incorporated a standard that your metrics can support across the partnership network?