Performance management and the outsourcing process: Lessons from a financial services organisation
International Journal of Operations & Production Management
ISSN: 0144-3577
Article publication date: 18 September 2009
Abstract
Purpose
The purpose of this paper is to assess the applicability of a number of performance management techniques in the outsourcing process, in a business services context.
Design/methodology/approach
Using a structured outsourcing framework, performance management techniques are applied in a financial services organisation over a three‐year period. A case study approach is employed to undertake the research, which involved the research team engaging directly with the organisation throughout the outsourcing process.
Findings
Applying performance management techniques in the outsourcing process is challenging in a number of areas including comparison difficulties, incomplete information and inadequate performance management systems. However, benchmarking and cost analysis are useful mechanisms for improving performance, and reducing costs via internal process redesign or outsourcing. Performance management techniques can be employed to remove inefficiencies from processes both prior to outsourcing and during the outsourcing relationship.
Research limitations/implications
There are a number of limitations of the research approach including gaining full participation from the company, having access to all relevant company information and time constraints.
Practical implications
The research findings highlight the implications of applying performance management techniques in a practical outsourcing setting. As well as identifying the challenges, the research highlights the value of integrating critical success factors, cost analysis, benchmarking and other performance management techniques into the outsourcing process.
Originality/value
There are few studies in the literature of applying performance management techniques in the outsourcing process at an operation's level. The findings have identified the challenges and benefits of performance management techniques in the outsourcing process. The findings have highlighted the importance of operations management concepts such as performance management, operations strategy, business improvement and process re‐design to services outsourcing, and the need for further research in this area by operations management scholars.
Keywords
Citation
McIvor, R., Humphreys, P., McKittrick, A. and Wall, T. (2009), "Performance management and the outsourcing process: Lessons from a financial services organisation", International Journal of Operations & Production Management, Vol. 29 No. 10, pp. 1025-1048. https://doi.org/10.1108/01443570910993474
Publisher
:Emerald Group Publishing Limited
Copyright © 2009, Emerald Group Publishing Limited