The Transformation And Termination Or Renewal
These SLAs define the level of service that is provided under the main contract. In outsourcing context, SLAs specify the priorities and responsibilities of the outsourced firm to the client, and what guarantees that they should give to the client regarding their services. In short, these SLAs dictate the vendor on the quality and the degree of services that the client expects them to deliver in accordance with the outsourcing contract.
These SLAs provide a measurement control for the client to gauge and evaluate the quality of service provided by the outsourced firm as part of the contract. They are useful later on in deciding whether or not to terminate or renew the existing contract when it expires.
Ongoing Service Delivery
This phase is the actual delivery of the service agreed upon by the parties during the earlier phases of outsourcing. This phase lasts from the beginning of the transition phase to the last effective date of the contract. Ongoing service delivery may have periods in which the company outsourcing the services would perform evaluations on the outsourced company. This is to ensure that the services rendered are in line with the SLAs provided for by the contract. The parties may also meet periodically to discuss possible problems with the engagement including those that arise from contingencies.
Termination or Renewal
The last phase of the outsourcing process is the “termination or renewal” step, which is marked by the last day that the contract is effective. This date is specified in the final contract, and has been agreed upon earlier by the parties during the negotiation phase. There are two options that the company could take at the end of the contract with an outsourced company. It could choose to take back its services and engage in insourcing, the opposite of outsourcing. If it chooses to do so, the company would have to set up a stand-alone entity within its organization. This entity will specialize in the skills that the company previously availed from the outsourcing firm.
Another definition of insourcing, however, is to subcontract the process to a firm within the jurisdiction or country that the company is located in. This mode of contracting became famous in 2006 because of some companies’ negative experiences in outsourcing some business functions, especially customer service, to firms in foreign countries.
If insourcing is not a viable option, the company could avail another outsourced company’s services in place of the previous provider. This decision would then require the company to go through a new process of outsourcing, and would have to start looking for a new provider to close an outsourcing contract with.
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