Outsourcing opportunity scorecards

To outsource, or not to outsource? We are increasingly faced with this decision whenever there is the consideration of bringing in external solutions or services.

What to source, when, and from whom

Outsourcing is typically used to pursue cost containment, focusing in-house staff on strategic, high payback, activities. Areas commonly considered for outsourcing include:

Applications development
Applications support and maintenance
Infrastructure management
- Hosting
- Remote systems management
- Networking
- Technology help desk services
Business process outsourcing
- Client technology product customer service support
- Internal desktop/end-user applications support

We have created some simple worksheets to assist in the "what if" thought process.

Outsourcing scorecard

Have an opportunity in mind? Fill out our brief questionnaire to see if you're on the right path. This page will refresh after you submit or reset. Of course, you should considered each case on its individual merits.

1. My opportunity is well-defined.

Organizational, functional, and workflow inputs, outputs, and boundaries are well-understood and documented. Scope, key risks, key assumptions have all been identified.

2. My environment is stable.

Technology in use is not changing, minimal changes to applications and business workflow. Predictable and well-understood.

3. My opportunity involves new technology.

Substantially changes hardware and/or software in use in the department/organization.

4. My opportunity involves a mission-critical function.

The workflow impacted by this opportunity is key to the organization and/or the enterprise. There is an immediate negative business impact in the event of outages or errors. This function is visible to Pearson customers and/or the market at large. Pearson's reputation can suffer as the result of a mistake or failure. All functions are "important," please rate based on risk exposure to Pearson.

5. My opportunity significantly changes business workflow.

Substantially changes the order and/or flow of work within the deparment and/or organization, and/or eliminates and/or introduces new workflows.

6. My opportunity is strategic.

Aside from other considerations of major impact (technology, workflow), and apart from current "importance" in the organization, represents an oppportunity to gain a significant competitive business advantage (scale, economy, uniqueness).

7. My opportunity is highly complex.

Addresses factors such as technology complexity (application logic, complexity of data feeds,...) and workflow complexity (management of, large number of inputs and outputs, complex decision trees implemented in automated and/or manual workflow,...).

8. My opportunity and environment are self-contained.

Minimal, small-scale, and well-managed interactions with the "outside world": applications minimally "talk" to other applications, minimally connect to customers or other internal organizations for inputs and outputs. Workflows are largely contained within departmental/organizational boundaires. Impact of changes limited primarily to department and/or organization.

Outsourcing worksheets

We also invite you to use these Excel spreadsheets to work on your "what if" scenarios.

Outsourcing Qualification Scorecard — this is an Excel version of the scorecard above. If your organization disables macros from external sources, use our web version here.
Outsourcing ROI Worksheet — this is a two-page worksheet estimating staffing and productivity costs to provide some initial feedback on the costs/benefits of an outsourcing opportunity; it's intended to facilitate an initial "back of the envelope" estimate; note that it includes factors such as desktop support, current staff occupancy costs, and so on. It is important to account for all per-staff costs both onsite and offsite.

These worksheets assist with an initial look at risk, costs, and benefits. While cost is often the initial if not primary consideration, there are others. Before we get into strategy, we offer some brief background on outsourcing and avoiding common pitfalls.

Today's technologist Considering outsourcing? Next Background and pitfalls Outsourcing viability PRESENTATION

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1.	My opportunity is well-defined.
Organizational, functional, and workflow inputs, outputs, and boundaries are well-understood and documented. Scope, key risks, key assumptions have all been identified.

2.	My environment is stable.
Technology in use is not changing, minimal changes to applications and business workflow. Predictable and well-understood.

3.	My opportunity involves new technology.
Substantially changes hardware and/or software in use in the department/organization.

4.	My opportunity involves a mission-critical function.
The workflow impacted by this opportunity is key to the organization and/or the enterprise. There is an immediate negative business impact in the event of outages or errors. This function is visible to Pearson customers and/or the market at large. Pearson's reputation can suffer as the result of a mistake or failure. All functions are "important," please rate based on risk exposure to Pearson.

5.	My opportunity significantly changes business workflow.
Substantially changes the order and/or flow of work within the deparment and/or organization, and/or eliminates and/or introduces new workflows.

6.	My opportunity is strategic.
Aside from other considerations of major impact (technology, workflow), and apart from current "importance" in the organization, represents an oppportunity to gain a significant competitive business advantage (scale, economy, uniqueness).

7.	My opportunity is highly complex.
Addresses factors such as technology complexity (application logic, complexity of data feeds,...) and workflow complexity (management of, large number of inputs and outputs, complex decision trees implemented in automated and/or manual workflow,...).

8.	My opportunity and environment are self-contained.
Minimal, small-scale, and well-managed interactions with the "outside world": applications minimally "talk" to other applications, minimally connect to customers or other internal organizations for inputs and outputs. Workflows are largely contained within departmental/organizational boundaires. Impact of changes limited primarily to department and/or organization.