A friend of mine used to call the consultants who were hired ather company tribblesa creature brought to life in the original StarTrek series. Tribbles were cute little furry pets that came onboard the U.S.S. Enterprise, bringing comfort and calmat leastinitially. The problem was they multiplied exponentially (they wereborn pregnant, and the more they atewhich they did constantlythemore they reproduced) and overwhelmed the crew. Likewise, thisfriend was watching a multiplying number of consultants come onboard offering comfort and support, all promising a solution onlythey could provide to the very problem they themselves uncovered.As each solution failed to solve anything, it created anopportunity for ensuing tribbles to implement their panacea to anow worsened set of circumstances with a similar lack of results.With money gushing out the door in fees, it came as no surprise thecompany eventually wound up in Chapter 11.

The trouble at that company, though, was not the tribbles. Theguilty party was management, which was clueless as to what theproblems really were and abdicated its responsibility. Those incharge didnt have any coherent goals or a notion about anappropriate remedy, nor did they implement metrics to monitorresults. They didnt get their hands dirty. And this misstepcertainly isnt a consultant issue; rather, it applies to anybusiness-partnering arrangement, including outsourcing or vendors(see related articles on pages 14 and 18).

A recent META Group report provided a process to drivedecision-making, vendor selection, and ongoing relationshipmanagement in outsourcing. It includes setting the rightexpectations identifying the enterprises short- and long-termbusiness objectivesselecting outsourcing vendors that can meet thebusiness objectivesnegotiating contracts with service levels thatalign with primary business objectivesmanaging the outsourcingvendor relationships with a strong dedicated team. Gartner took alook at the flip side about a year ago and cited six worstpractices of outsourcing that limit success: short-term focus, poorcommunication, inadequate service levels, no benchmarks, failure torecognize risk, insufficient resources.

The point here isnt in the particulars so much as it is in theneed for the active participation of the company working with theoutsourcer, consultant, or vendor right from the start. While thecompanies you hire may be the experts in their niche, you must bethe expert in your business, and your expertise has to control anddirect theirs.

With the expected growth in outsourcing and continued businesspartnering of all kinds, insurers need to take the lesson of myfriends company to heart. Working with any partner involves varyingrisks. As carriers shift their focus from using outside help tofulfill limited tactical IT needs toward meeting challenges on anenterprise or broader strategic level, those risks get riskier.Participating fully in the process assists in containing suchrisks, and companies that do so, will (to quote Star Treks Spock)live long and prosper.

Sharon S. Schwartzman
Editor-in-Chief