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[Webinar Recap] Outsourcing Governance: What’s Buzzing and What’s Missing
SirionLabs conducted this webinar on 6th December 2016. Titled “Outsourcing Governance: What’s Buzzing and What’s Missing” and it featured John Dreyer, CEO of The Shelby Group and Claude Marais, Co-founder & President of SirionLabs. Here is a quick summary. We all know that our outsourcing arrangements can be improved through better oversight. But despite this realization, …
SirionLabs conducted this webinar on 6th December 2016. Titled “Outsourcing Governance: What’s Buzzing and What’s Missing” and it featured John Dreyer, CEO of The Shelby Group and Claude Marais, Co-founder & President of SirionLabs.
Here is a quick summary.
We all know that our outsourcing arrangements can be improved through better oversight. But despite this realization, approximately $200 bn is lost annually in unrealized value due to inadequate governance in such engagements. Our experts discussed why it is critical to have a strong governance infrastructure in place in order to realize the full value in outsourcing engagements. They also discussed the key attributes of effective supplier governance across contract, performance, financial, risk and relationship management.
In order to understand why value leakage in outsourcing is such a huge issue across the board for most organizations, SirionLabs and The Shelby Group recently conducted a comprehensive study on the maturity of outsourcing/supplier governance. Respondents from across the globe from different functional backgrounds including procurement, sourcing, supplier management, contract management and IT participated in the study (over 65% were from companies with revenues exceeding $1 billion). The findings from the survey were published in a report titled ‘Overcoming the Value Gap in Outsourcing Engagements’ (download this report here).
Our experts walked the audience through the key insights from the study. The survey revealed significant gaps across most areas of supplier governance. Sample this:
- 92% of respondents consider Service Level Management as Critical or Important but 40% reported their current capabilities as basic or non-existent
- 86% of respondents consider Contract Repository as Critical or Important but 37% rated their organization’s current capabilities as basic or non-existent
The fact that the respondents rated most of these areas as highly important shows that they understand the significance of the various governance disciplines in driving value in outsourcing engagements. However, the low levels of current capability reported by the respondents in these areas suggests that organizations need to focus their energies in strengthening these areas – through a combination of people, processes, and technology. Going by the feedback that we received from our audience, this was the most interesting part of the webinar for them.
The discussion then moved to how organizations need to approach their outsourcing engagements from a governance perspective to get the most return on their investment in these relationships. With their extensive experience of managing outsourcing relationships at large organizations, our experts had several real-world examples to share with the audience.
Claude Marais, Co-founder & President, SirionLabs
Claude has been a leader in the global sourcing domain for over two decades. Prior to SirionLabs, Claude pioneered ISG-TPI’s supplier governance solution. During his leadership the practice grew to $11 bn in managed TCV. Earlier, Claude was the global leader for contract management and strategic sourcing in GM’s $3 bn/year ITO organization. Before GM, Claude had leadership roles in the Procurement and IT organizations at The Coca-Cola Company. He is a co-founder and past National Chair of the Society for Information Management IT Procurement Working Groups, a founding member of the ICEX Outsourcing Forum and a Fellow and Honorary Vice Chairman of IACCM.
John Dreyer, President and CEO, The Shelby Group
John’s expertise in finance, technology and business strategy has helped establish The Shelby Group as a leader in procurement and supply chain optimization. He works with senior leaders at Shelby’s Global 2000 clients to design innovative solutions for aligning sourcing, procurement, and supplier governance with C-suite objectives to drive bottom-line results. Using a combination of data-driven insight and supplier engagement, John leads his team to reframe relationships and achieve client objectives for outsourced professional services.
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