Outsourcing - BPO
Ethics of Outsourcing
Many times, business organizations encounter the dilemma of ethical
decision making. “If a CIO says ‘I've never faced an
ethical issue’, they're not living in the real world,"
says Larry Ponemon, chairman and founder of the Ponemon Institute,
a security and privacy research think tank based in Arizona.
Though business relationships are more economic in nature, their
moral and ethical dimensions have an equal impact on profitability.
When it comes to the ethics of outsourcing, matters become more
complicated, as parities involved are continents away. A judicious
choice between the right and the wrong person to do business with
will determine the future of your outsourcing venture. Why is
it important to do business with organizations that are ethical?
Ethical compliance presents a strong public image and upholds
the integrity and character of an organization. Whether personal
or professional, not many of us will want to associate with unethical
individuals. It makes a lot more sense to do business with ethical
organizations as it has a direct influence on the overall functioning
of a business.
When things go wrong!
This is the acid test. The way your outsourcing partner reacts
during a crisis is the best indicator of whether it is ethical
or unethical. When there is mutual trust and responsibility towards
each other, a crisis management mechanism will automatically evolve.
Ethics creates a space for itself and in ensuring the smooth running
of businesses.
Legal aspects
Legal perceptions may differ from one nation to the other and
ambiguity could arise when a dispute occurs, leaving both parties
in a fix. The association becomes easier when the parties have
a legal, moral and ethical obligation to comply with the agreement,
with due respect to international law.
Information Security
The core concern of outsourcing ethics is confidential information
security. Privacy and security fall under the ‘no compromise
zone’. Sujoy Chohan, a consultant at IT research specialists,
Gartner Company, says, “If there is any industry which is
investing in security tremendously, it is the offshore industry,
whether it is India or elsewhere”.
Chief Privacy Officers are highly concerned about proper information
security practices. If your outsourcing partner does not have
adequate information security measures, it might be wise to stay
clear of them.
How does an outsourcer identify organizations which are doing
ethical business?
Everyone claims to be ethical. Though a clear definition of the
parameters for identifying organizations with ethical conscience
will be a difficulty, some factors are vivid.
Vendor reliability
It is nothing but trust that makes someone want to outsource.
Weigh the dependability and reliability of the organizations to
which you want to outsource.
A clear definition and practice of the ethical rules and privacy
policies of the organization like non-disclosure of trade secrets,
secrecy and non-disclosure contracts with staff, third party service
providers and visitors is a prerequisite. This will reassure the
outsourcer that it is safe to do business with a partner who is
miles away. Employee Credibility
Information security will largely depend on the people who handle
the information. Organizations that implement tough employee credibility
measures have a direct implication on its outsourcing ethics.
Communication
Clear and open communication channels are another sign of an
ethical company. When a project does not go the right way, an
ethical partner will always keep you informed of the problem and
possible solutions and time needed.
Inquiry
A thorough enquiry should be made about the organization and
their nature of work management. Talking to the employees and
references will give a clear idea about the professional approach
of an organization. Check if the following requirements are met
by your outsourcing partner:
•Proper information security systems
•Appropriate quality certifications such as ISO 9000 or
SEI CMM
•Appropriate programs to protect the trade secrets of its
clients, partners and their customers
•Infrastructure
•Training and upgrading the security skills and awareness
of employees.
•Safety of electronic data storage
•Presence of a whistleblower
•Proper arrangement with third party service providers
How does being ethical help in reducing the risks of offshore
outsourcing?
You can always find companies that offer services at very low
costs. An ethical concern might seem to be a costlier choice.
However, the price difference could be deceptive as the variation
will only be in the initial cost. In the long run, the overall
cost will prove to be much lower when you are working with an
ethical partner.
Ethical vs. Unethical partnership
Unethical partnership:
•The cost of maintaining the project and the relationship
will be high
•Lack of trust
•Strained relationship
•Non disclosure of facts
•Lack of transparency
Ethical Partnership:
•Reduced costs
•Reduced risk
•Common focus
•Relationship equilibrium
•Knowing the risks and managing them together
•Proper management systems
Client responsibilities
Before making an outsourcing decision, the outsourcer should
also be clear about the responsibilities that he should share.
This will help in building a healthy relationship base.
•willingness to discuss
•manage expectations
•last agreed document should be the basis
•build flexibility to contracts
•openness to intermediate scope and price review
Make sure that all the loop holes which can disrupt the outsourcing
process are dealt with. The benefits of outsourcing are sure to
show up with safe outsourcing practices.
For more information on outsourcing, log on to outsource2india.com
Article Source: http://EzineArticles.com/
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