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Managing IPR in a digital age August 22, 2011

Posted by Mark Hillary in IT Services, Outsourcing.
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So you have a dilemma.

You may well already use an outsourced or managed service environment and it all works well, but then the supplier calls and offers to start doing some extra parts of your supply chain. Moving up the value chain as the expression goes.

That’s great too, provided it’s a supplier you know and trust. Why not ask them to take on more work if you know you can trust them to deliver?

But the thing that often worries clients is how they can outsource higher-end work without losing control of their intellectual property.

It’s a dilemma, because the boundary of the organisation is constantly shifting, but where contracts are concerned, someone needs to take a decision so services can be defined. But when are the key parts of the relationship to check on if you are going to extend a process outsourcing relationship?

  • First, is to ensure you have all your IP protected anyway using tools such as trademarks or copyright. You need to have your own house in order first.
  • Second, is to review the contract with your supplier. Can you ensure that you retain IP rights even if the supplier creates value and possibly even invents new processes for you?
  • Third, be aware of your own limits. There is always a pragmatic limit about what can and can’t be protected, so make sure you have also considered the difference between what the law says and what you really can do in the event of a breach.
  • Fourth, review all practical security measures that can be taken  around the relationship, hand-offs, and the delivery site so that confidential IP cannot be removed from site.
  • Fifth, identify where the supplier may be working for your competition and so-called ‘Chinese walls’ need to be extremely strong.

In most cases, if you have a great supplier at one level, then they will be able to scale up to the next level. It is usually beneficial for the supplier (more business) as well as the client (more services provided by a trusted and already proven partner) so this should not be considered a dangerous strategy.

In fact, it’s going to be essential for most firms to turn to trusted partners more and more, just to achieve the kind of performance expected of a twenty-first century business.

Ensuring you can work with an ecosystem of partners whilst still protecting your valuable IP is all just a part of doing business in a globally connected environment.

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Collaboration drives innovation May 13, 2011

Posted by Mark Hillary in IT Services, Outsourcing.
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What is the biggest change in outsourcing over the past decade? Probably the level to which it has become an established part of the executive toolkit – no longer an exotic strategy adopted by the manager as he returns from a career-break spent completing an MBA at Harvard.

Outsourcing has become a normal and accepted business strategy for different types of company and business functions. But there is a world of difference between procuring a service and working with a partner. Despite the way most suppliers toss around ‘partnership’ during the sales process.

As outsourcing has matured though, it has become clear that it works best when there is a genuine sense of partnership and collaboration. This is hard to create, and even harder to sell, but it is possible.

What is needed though, is for the buyer of a service to appreciate that they are buying from an expert, not trying to find the cheapest possible deal from a company they don’t care about at all. The service provider has to understand that they are not going to just deliver a service at the lowest possible cost, but they are going to become an integral part of the client’s supply chain.

Traditionally the power has always been with the client. They are buying the service and they call the shots. But as it becomes clearer that many client firms are really just brands with a controlled network of suppliers, who has the power?

It is not that suppliers have suddenly achieved the upper hand, but their importance in making a business relationship work is acknowledged far more today, and that opens the door to a genuine partnership where doing well together works for both client and supplier.