Oversight of outsourcing essential for success: Filene white paper
MADISON, Wis. (3/16/15)--Credit unions use outsourcing to help cut costs, tap into external talent and skills, and stay on top of regulatory compliance. Outsourcing doesn't mean "out of sight and out of mind," however.
In fact, oversight is a key driver to the success of this business practice, according to a new white paper from the Filene Research Institute.
In "7 Questions for Smart Outsourcing," Filene taps credit unions that have outsourced everything from websites to core processing.
Outsourcing a product or service doesn't mean the credit union is no longer responsible for it, the paper noted. Policies and procedures must be in place so that assigned staff are knowledgeable and committed to managing the relationship.
"You don't have to be the expert--that's why you're hiring the outsourcing partner--but you do have to pay attention," said Linda Bodie, CEO, Element FCU, Charleston, W.Va. "You should be learning and growing from this partnership and gaining a better understanding of how to manage it over time."
The white paper offers seven questions to help guide a credit union's outsourcing decisions:
- What function is my credit union considering outsourcing and why?
- Does it make sense to outsource this function?
- Do I understand what I want and need from an outsourcing partner?
- Do I understand the challenge well enough to effectively investigate my outsourcing options?
- How does my contract protect my credit union and my members?
- How will I ensure proper oversight?
- How am I preparing for the failure of my outsourcing partner and the end of our arrangement?