Globalization 4.x -- The Reality of Sourcing the Flat Corporation (excerpts) by Mark P. Dangelo. Complete 1600+ word copy appearing in the national Mortgage Bankers Association (MBA) publications, April 22, 2008.
Preparing the organization for the mandate of flexible and variable global sourcing arrangements
"...In striking contrast to the haze of the future is the clarity of the past. Financial and mortgage markets both domestically and globally continue to be unpredictable coupled with extensive losses - economic, jobs and investor confidence. The precise future direction, outcome, and timing of improvement are still very uncertain. However, the risks and actions of past deeds are never clearer especially when examining the historically laborious arrangement designed with global sourcing providers or more commonly referred to their using nationalistic tendencies as outsourcers.
Let me be very provocative, traditional sourcing practices and their operating arrangements are difficult to manage, govern and modify especially with the socioeconomic shifts still playing out on the domestic and world stages. In fact, the results for many layered contractual arrangements result in failure or early separation approximately two-thirds of the time. We've all had experiences with information technology or business process third-party sourcing arrangements (i.e., outsourcing) that performed poorly or are consistently acrimonious. Why? Did the advisor miss the mark? Were the organizational expectations set too high? Was the provider poorly prepared for the responsibility and process accountability? Was the arrangement too restrictive and unyielding in times of dynamic business conditions? Was it the sourcing organization and not the provider that was unprepared for the discipline and rigor needed to manage the operations post transition? Was it all of the aforementioned? Was it none of them?
It is evident in projecting forward, that success can no longer be guaranteed using dogmatic, offshore competitive approaches. Competition and success are no longer about organic head-to-head strategies. Tomorrow's success is about collaboratively assembling or orchestrating operational delivery systems from a virtual base of suppliers, providers and customers. The point-based sourcing organizations / outsourcers have reached diminishing returns. Lastly, to set the proper stage for moving forward and contrary to popular opinion and political sentiments, we are entering not the second iteration of globalization - we are already experiencing the fourth..."