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The Smart Techie was renamed Siliconindia India Edition starting Feb 2012 to continue the nearly two decade track record of excellence of our US edition.

April - 2009 - issue > Technology

Managing Risks in Offshore Outsourcing Relationships

Subhash Parameswaran
Thursday, April 2, 2009
Subhash Parameswaran
As strange as it may sound, many Fortune 1000 companies don’t have a process for risk assessment and best practices when dealing with offshore vendors. While most major companies recognize there are risks associated with the development of offshore relationships, many fail to develop a strategic approach to risk management.

In most instances, risk management plans are reactive and tactical rather than proactive and strategic.

Very few organizations consider risk assessment and mitigation planning as part of their sourcing strategy. If there is a strategic approach to risk assessment, potential risks can be identified during the sourcing strategy phase.

Risk Assessment, an Ongoing Process
Risk assessment is a continuous process and should be conducted in all phases of the sourcing lifecycle, utilizing an established process. Risks must be categorized into groups vital to the ROI of the organization. Some standard risk categories to be included are:

1. Business risks

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