Assessing and managing risk comprehensively is the cornerstone of a successful offshoring program. Moving beyond basic security particularly important given the breadth and scale of current global sourcing initiatives that expose businesses to multiple levels of systemic and operational failure. The concern is amplified by the level of sensitive and confidential data and intellectual property accessible to offshore operations, especially in highly regulated verticals such as healthcare and banking.
Organizations that have extensive sourcing programs with multiple delivery channels must take into account their overall risk exposure from the very beginning. Here are the Top 5 risks that must be addressed for your organization to move beyond basic security to a higher level of “enterprise program assurance:”
1. Organizational: How strong are your internal policies and procedures, governance processes, personnel, physical and network controls, and global assurance and audit capabilities? Are they customized for global operations?
2. Programmatic: Can you meet overall enterprise and customer servicing requirements in a multi-sourced environment and maintain the financial viability of the global program?
3. Domain: Is dependence on sourcing causing a gradual loss of technology capabilities, operations knowledge and intellectual property in the business unit and creating the need for robust knowledge management frameworks to manage them?
4. Delivery model: Is the delivery model for business-critical applications and processes robust? Is the delivery footprint sufficient to overcome the risk to a single geography? Are you so dependent on one service provider that its business risk is transferred to you?
5. Operational: Do you have delivery controls and disaster recovery and business continuity plans that are responsive to a rapidly changing environment including pandemics such as SARS and swine flu, terrorist attacks and mounting regulations?
Protecting your business in today’s environment takes careful planning and follow-though. A comprehensive model program to assess global sourcing risks and build a multi tiered risk management program is a key determinant of the soundness of any global operating model.
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