Peer Counsel: Involving Outsourcers in the Department’s Reorganization

How involved should your IT outsourcers be in planning an IT reorganization, especially in a company that’s becoming more centralized?

Outsourcers view a company’s move to centralize in two ways: They see it as a potential growth opportunity, but they also see it as a threat—a threat that the company may decide it can do things better, faster and cheaper in-house and therefore no longer needs the outsourcer. We learned during our IT centralization initiative that it might have been smarter to bring a representative from our outsourcer onto the reorg team at the start. That way we wouldn’t have had to manage a separate set of communication and change-management issues around vendor-relationship concerns.

I don’t mean that you should take vendors inside and make them privy to all the nitty-gritty. But if you at least include your vendors in steering committee meetings, there’s open communication. At Cendant, we have since brought our vendor into the communication loop, involving it in status meetings, and that’s been very helpful.

This involvement has built trust in the relationship, which is important regardless of the outcome of the centralization initiative. Through transparent dialogue with the vendor, we were able to identify potential issues in the centralization initiative that we might have missed without the exchange of information between our teams. This created an atmosphere of partnership that allowed us to be honest across company lines, benefiting both parties.

Even if the outcome of an IT centralization initiative is a significant change in an existing outsourcing relationship, the trust built during this process allows both parties to maintain the relationship into the future, potentially providing new opportunities to work together that might not have been apparent otherwise.

–Paul Lawler, Senior VP, Technology Operations, Cendant