Evaluating UK Intra-National Outsourcing to North Staffordshire

Outsourcing is a widespread practice in the modern global economy, with decisions motivated by expectation of various advantages of which cost reduction is often the primary factor. Recent trends have been towards Business Process Outsourcing (BPO) and offshore outsourcing, and more recently Knowledge Process Outsourcing (KPO) has emerged as an established area of the market. Despite the potential attractions, there are a range of risks associated with outsourcing, and these are demonstrated by the substantial number of arrangements that fail to meet expectations. For example, Glick (2004) cites research by Gartner that indicated £4bn was wasted on poorly managed contracts by European businesses in the previous year. This highlights the business significance of outsourcing decisions and shows that the impact of major outsourcing decisions is likely to be strategic in that the competitive position of a company is influenced by the outcomes. The argument for use of a systematic decision support system to assist with outsourcing decisions is persuasive. The Holistic Approach Business, Information, Organisation (HABIO) Framework offers a holistic approach which takes account of interrelated strategies and complex considerations that may vary according to the circumstances and priorities of the decision-maker. It also facilitates monitoring decisions over the life of the outsourcing arrangements, thereby supporting timely anticipation and response to significant changes in the economic, political, or social environment. The HABIO model could be used in consideration of intra-national outsourcing decisions to areas such as North Staffordshire where decline in industries traditionally associated with the locality created needs and opportunities for regeneration.