This ebook of KellyOCG and the Henley Business School is crystallizing some repeatable characteristics of successful outsource supplier partnerships.

1. FORGING
SUCCESSFUL
PARTNERSHIPS
WITH AN
OUTSOURCING
provider
Advice & Anecdotes from the C-Suite
Susan DeFazio & Dr Anne Dibley

2. Kelly OCG and the Henley Centre for Customer Management
at Henley Business School undertook a year-long study to identify
the repeatable characteristics of successful outsource provider
partnerships. They reviewed and analyzed the most respected
publications on the topic of service agreements, and conducted
in-depth interviews with over a dozen senior executives from
outsourcing providers and client companies. The findings are
crystallized here in a 15-minute primer for senior executives.

3. 01
success factor
Strong Governance
Plans change. Outsourcing agreements and memorialize those ‘mechanisms’ in the The timing and composition of meetings should
can’t account for every possible wrinkle in agreement. You may decide to have a single be spelled out in the service agreement—no
an evolving, dynamic relationship. Strong point of contact to delegate tasks, or to institute matter how plodding the exercise may seem.
governance agreements compensate for a customized ‘heat map’ that documents on- The structure and purpose of meetings should
uncertainty and define how the partnership going tasks, unresolved issues, and individuals be reviewed constantly so they don’t become
will ‘flex’ over time. responsible. stale. Consider atypical formats from time to
time, such as a ‘blue sky’ discussion, to foster
Create a mirrored governance structure Demand a clearly mapped ‘relationship innovative, fresh thinking.
between the provider and client, from senior infrastructure’ from the outsourcing provider.
management on down. Disseminate the right management
The outsource provider should define and map
information to support the governance.
You should know who’s ‘facing off’ when clear roles across their global organization,
problems surface. Mirroring begins with the repeated by country and by discipline. By Sharing clear, relevant, real-time information
CEOs of both organizations, who should meet standardizing roles, the OS is better positioned is critical to drive action. Key performance
at least bi-annually to ensure the governance to scale the partnership to multiple countries indicators (KPI) should be reviewed at every
structure is effective at delivering the results and business units. meeting—not as lengthy ‘back-patting’
both parties expect. The ladder of mirrored overviews to show how all is proceeding to
relationships should be clearly documented in Respect the critical importance of meetings plan, but a tightly focused look at exceptions.
the agreement, from C-level all the way through as the ‘tailwind’ in a successful partnership. As one executive put it, “The MI should be used
operations. A tightly woven partnership solves to drive out the low and high points, and think
In our interviews, the subject of meetings
problems more efficiently than the alternative. about the future.”
(e.g. how often, who comes, what follows)
Define roles clearly, particularly who ‘owns’ was a point of extensive discussion and
what issues in your governance framework, thoughtfulness. Consistent, well-run meetings—
then set up accountability for marking from weekly progress meetings to executive-
progress and resolving problems. level performance review meetings—were
characterized again and again as the element of
Institute a clear system for following up on traction in highly complex relationships.
action points from project review meetings—
3

4. 02
success factor
measuring value & success
Measure success based on supporting Gut-check KPIs regularly. Client satisfaction is among the most
growth rather than driving down costs. important measurements to capture.
The OS and client should examine in-place
Explains one executive, “Some clients think metrics regularly to determine if they are still No matter how stunning your KPIs, the client
they’re asking for cost reduction and value, but relevant. To move beyond a short-term focus (both managers and end-users) must ‘feel’
are really only focusing on costs. They need on costs, be explicit about the value being this success to make it so. Says a procurement
to look at the ‘total cost of performance.’ For delivered. Says an OS executive, “[We] might executive, “We, as procurement, can say, ‘this
example, Client Performance + Provider A gives be running twice the number of applications is a really successful programme, we have ‘x’
you Performance X, but Client Performance + with half the people. If you don’t [define] this, in amount of savings’ etc, but in essence, the
Provider B might give you Performance Y.” two or three years time, your client is going to programme will not be successful, as long as it
say, ‘you aren’t doing enough.’” is not in the minds of our business stakeholders.
An outstanding outsourcing provider can help
clients raise the bar, setting new performance The concept of value can change, almost One executive reports two simple ways to
goals based on growth and access to talent. imperceptibly, over time. Says one OS measure whether client satisfaction is high:
executive, “You need a quarterly process to “First, does the client say ‘yes’ when you want
recognise and define how value is changing. them to act as a reference for a new piece of
At a senior level, every meeting you have with business? Second, is the client prepared to put
the client, put on one sheet of A4 paper – ‘this their name or brand on a case study?”
is what we’ve done for the organisation; this is
what we’ve achieved”
“To get approval for a video case study is the ‘holy grail.’ if your client is prepared
to have a video of him on your website saying you’re all good to work with...
In my opinion, it doesn’t get any better than that.”
—outsourcing provider
4

5. 03
success factor
Openness, transparency,
honesty & responsiveness
Don’t forget to recognize the value the Expect a provider to propose strategic,
outsource provider is providing, repeatedly. sophisticated solutions, based on their
expertise—and offer plenty of opportunities
Treat the provider as you would one of your
for them to do so.
own executives or managers to promote
greater openness and transparency. Consider As one provider explained, it’s “not just getting
an awards program, team building ‘day-aways’ the ball back over the net,” but dealing with
or other special gatherings. These types of root causes and the long-term. The solution
events warm up the relationship, signaling to a particular problem may not be a simple,
respect and commitment. bottom-line solution, but require a more
nuanced analysis.
“Each institution holds dear the long-standing relationship and understanding
they have [with an outsourcing provider]. Most companies would point to
one or two suppliers where (sic) you know that, come hell or high water, that
supplier is going to be there for you.”
—client organization
5

6. 04
success factor
MUTUAL TRUST AND CONFIDENCE
Trust and confidence—assuming it’s well- questions and analyze difficult problems. Why does building trust matter? If the OS team
placed—begets a more productive relationship. Says one client company executive, “The feels hung out to dry, says one provider, “You
Those are qualities that grow out of a outsource provider must have the ability to get the ‘dregs’ on that account. On the provider
competent, long-term relationship, yet there are connect and understand the business, and side, people can manage themselves out of
actionable steps to speed the process. look at the overall value it can bring to the accounts. The client doesn’t necessarily realise
organisation. They need to understand the it’s getting the B, C and D teams.”
Share problems early and plainly—and ask business pressures we’re facing, and how they
for this type of openness in the agreement. can help us meet our goals.” Aspire to reach a state of mutual,
institutionalised trust.
Trust and confidence emerge not in heady
Share sensitive information early.
periods of success, but in the midst of challenge Institutionalised trust is characterised by low
and stress. One OS leader explains, “Honesty is A true measure of mutual trust is the number attrition and extensive sharing of financial
telling the truth when you’re asked a question; of ‘unofficial conversations’ the relationship information. Says one provider executive,
transparency is telling the truth, plus showing manager on the client side is prepared to have “You mention the name of the client, and
concerns, gaps, negatives, and being open with his counterpart on the provider side. For everyone responds instantly. [...] Each institution
when you can’t do something. example, a client may tell the provider about holds dear the long-standing relationship
an organisational change before it has been and understanding that they have. [...] Most
Choose your key contacts—particularly officially announced to help the provider look companies would point to one or two suppliers
the OS-based ‘client manager’—wisely. good to within his own organisation: “They’re where you know that, come hell or high water,
This individual should be chosen as a steward telling you because they trust you that it won’t that supplier is going to be there for you”
of the relationship. Aside from having excellent go any further, [...] giving you a ‘heads up’ on
relationship skills, he or she should also be a something that may impact you, rather than
shrewd businessperson, able to ask probing leaving you on the back foot.”
6

7. 05
success factor
Delivering what you promise
To deliver on promises, take time we actually agreed here? What does it mean
to study and internalize what’s for you?” The facilitator helped the employees
commemorated in the agreement. visualise the reality of the outsourcing
relationship: “If this is what we do, this is what
To do so, bring in a third-party facilitator to
it will look like for you and your people.” These
run workshops that ‘translate’ the language
exercises embed the ethos of the agreement
of the agreement into real-life scenarios and
across both organizations, moving beyond the
processes. One executive recounts how a
checklist of expectations.
facilitator helped employees to reinterpret the
contract, and answer the questions, “What have
“Internally, ensure you’ve properly mapped and understood issues surrounding
each of the customers within the [client] organization (i.e. how those
relationships work and how people react). Don’t fall afoul of the strongest
opinion-formers within groups. Understand who they are--they are not always
the most obvious ones.”
—Outsource Provider
7

8. 06
success factor
Achieving mutual goals,
bringing mutual benefits
The client must believe that success for the Clients should not view providers as
provider equals success for the client. a destination for savings, but as an
extension of their own enterprise,
If the client genuinely supports and believes
and an opportunity to create value.
in the importance of the provider’s success,
this enhances the chances of a successful The best partnerships function as peer-to-peer.
collaboration. Says one client executive, “The Says one client executive, “Even though they
better they perform, the better they perform are a third party, we like to think they’re part of
for us. [We need to] ensure they’re motivated, [our organization.] It’s 50-50, the relationship.
progressive and doing best industry practice. We rely on them, we’re there to support them;
We’ll do whatever we can to support that.” they’re the ones who give us feedback. [...] We
bring new initiatives to the table, then they
have 50% input on how it all works. [...] If we ask
them to do something and they can’t do it, we
have to be real; they can’t do everything. We
always work on solutions together.”
“I’m supporting the growth of their business; this stimulates them to do things
for me that they might not be contracted to do. It’s a balanced ‘give and take’
relationship. I make sure information is shared; by withholding information,
you’re shooting yourself in the foot.”
—client company
8

9. 07
success factor
Giving extra value and on-going innovation
The OS must have the ability to find To innovate, create ripe opportunities.
connections between its knowledge
The client and provider must set aside time—
base and the client’s needs.
as a contractual obligation—to discuss and
Says one client executive, OS companies support innovation. Says an OS executive,
must “look at the market and us, and “Innovation happens when the client
understand trends. Understand what HR encourages it, [saying,] ‘We’re going through
operations will look like in five years time. a restructuring, and we’d love your thoughts
They must work out how they need to develop on how we’re going to manage our workforce
their products to serve that industry. They differently in this new model. Can you work with
should present us with leading-edge us on this to make us more nimble?’”
capabilities that have been developed;
don’t use us to learn and build capabilities.”
“You need the right people and roles in place to foster this discussion
on a regular basis, as well as formal governance planning.”
—Client Organization
9

10. About the Authors
Susan DeFazio is Senior Director and Principle Workforce Consultant within
the Global Centre of Expertise for Kelly Outsourcing & Consulting Group. She
has extensive experience in the human capital sector which includes leadership
positions in staffing operations and strategic account management.
Dr Anne Dibley is Programme Director for the corporate MSc in Strategic
Marketing Leadership, and is a Lecturer in Marketing at Henley Business
School. Anne’s research projects for the Henley Centre for Customer Management
include studies focusing on corporate social responsibility, sustainability, how to
manage outsourcing relationships, and collaborative innovation.
About the Henley Centre for Customer Management
Under the directorship of Professor Moira Clark, the centre brings together business
practitioners, industry thought-leaders and experts/ academics to help organisations tackle
today’s business challenges through a programme of workshops and research projects.
Find out more at www.hccmsite.co.uk.
About KellyOCG
KellyOCG is the Outsourcing and Consulting Group of Fortune 500 workforce solutions provider,
Kelly Services, Inc. KellyOCG is a global leader in innovative talent management solutions in the
areas of Recruitment Process Outsourcing (RPO), Business Process Outsourcing (BPO), Contingent
Workforce Outsourcing (CWO), including Independent Contractor Solutions, Human Resources
Consulting, Career Transition and Organizational Effectiveness, and Executive Search.
Further information about KellyOCG may be found at kellyocg.com.
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