Understand your objectives Sample Clauses

Understand your objectives. The most frequent cause of unsuccessful arrangements is that the service provider did not meet management’s expectations - usually because these expectations were poorly understood or articulated by both parties involved. Such a situation may arise in IT outsourcing, for example, because end-users may not be sure of their needs, the technology may be new or untested, business requirements change frequently, or implementation did not occur as expected. In some situations, senior management may have conflicting objectives for the arrangement, or unrealistic expectations as to what problems the outsourcing can solve. For example, if outsourcing is undertaken primarily to reduce costs or to convert fixed costs to variable costs, it may result in an arrangement that compromises quality, timeliness and level of service, which may be unanticipated by management and lead to disappointment with the arrangement. In such cases, as the situation deteriorates, outsourcing risk increases.