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The 'New' Outsourcing is about Business Outcomes

Fujitsu Australia Limited,Fujitsu New Zealand Limited

Sydney, July 29, 2003

Too many Australian organisations are still reaching outsourcing agreements for the wrong reasons and without the level of detail necessary for them to be a success, according to Peter McFarlane, Executive General Manager Services, Fujitsu Australia.

Speaking at a Gartner Dataquest conference entitled Outsourcing - The Next Generation Technology Summit, Mr McFarlane said that for many organisations outsourcing remains a painful experience that has had to become much more rigorous and disciplined. However, while many first generation outsourcing agreements have expired, the vast majority of organisations are continuing to outsource rather than bring functions back in-house.

Mr McFarlane said the most common mistake organisations make when outsourcing is to focus on short-term goals rather than longer-term objectives. This is a symptom of treating the outsourcing process as transactional and confrontational, rather than a partnership.

"Organisations are too concerned with cutting costs at the expense of delivering business value," Mr McFarlane said.

"Many also fail to specify service-level agreements from a business perspective. There should be an early consensus between both parties to develop common goals and set mutual expectations backed by performance measurements."

Mr McFarlane said it is important to ensure that outsourcing contracts can evolve to support the organisation's business requirements. Such agreements need to have a flexibility that allows both the outsourcer and the customer to respond to change.

"Fujitsu has supported many government departments and enterprise clients through restructuring, and assisted clients going through mergers and acquisitions," Mr McFarlane said.

"Our experience is that successful relationships thrive in a culture of trust and commitment. We believe a partnering culture grows when the stakeholders agree upon areas such as common goals, potential obstacles, mutual expectations and performance measurements. This provides opportunities for outsourcers to provide real innovation by leveraging new technology and improved processes.

"Both sides of the outsourcing industry - vendors and customers - have made the mistake in the past of dealing with outsourced services on an IT level. The flavour and style of outsourcing has changed. The focus now is on business outcomes."

About Fujitsu Australia

Fujitsu is a global leader in information and communications technology solutions. Throughout Australia and New Zealand, Fujitsu is recognised as a leading systems integrator and services provider. We deliver complex infrastructure systems and services, and business and telecommunications solutions, as well as offering access to a wide network of partners. From the desktop to the data centre; multivendor procurement to prime contracting; consulting to systems integration, Fujitsu has earned a reputation as the single supplier of choice for leading corporate and government organisations. Fujitsu Australia Limited is a wholly owned subsidiary of Fujitsu Limited of Japan.
For more information, please see: www.fujitsu.com/au/

About Fujitsu

Fujitsu is a leading provider of customer-focused IT and communications solutions for the global marketplace. Pace-setting technologies, highly reliable computing and telecommunications platforms, and a worldwide corps of systems and services experts uniquely position Fujitsu to deliver comprehensive solutions that open up infinite possibilities for its customers' success. Headquartered in Tokyo, Fujitsu Limited (TSE:6702) reported consolidated revenues of 4.6 trillion yen (US$38 billion) for the fiscal year ended March 31, 2003.
For more information, please see: www.fujitsu.com

Gillian Lamrock

Phone: Phone: +61 (02) 9776 4799
E-mail: E-mail: gillian.lamrock@fujitsu.com.au
Company:Fujitsu Australia Limited

Date: 29 July, 2003
City: Sydney
Company: Fujitsu Australia Limited, Fujitsu New Zealand Limited