INFO6010Advanced

Concepts in IT Project
Management
Week 10: Outsourcing and
Virtual Team Management
Presented by
Dr. Ifeanyi Egwutuoha

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 Project Outsourcing

Outsourcing transfers project activities and certain decision

rights to an external entity, by contract, with specific
performance measures, related rewards (generally
monetary), penalties (again generally monetary), and exit
clauses defined. (Brewer and Kevin C. Dittman. Methods of IT
Project Management : Third Edition, Purdue University Press, 2018.)

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 Project Outsourcing

– A client outsources project

management functions to a
vendor or service provider
– A service provider outsources a
part of its project management
functions to another vendor or
service provider
– Project management functions
are considered separately and
awarded as a separate
assignment (contract like) within
an organization.
https://www.pmi.org/learning/library/outsour
cing-project-management-services-7150
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 Pros and Cons of Project Management Outsourcing?
Pros
– Clients can focus on core
competencies
– Faster ramp up time or time to
market
– Fresh look from an outside view
– Vendor can ensure that best
practices are followed and can
provide latest trends in specific
sectors
– Preparation for similar projects in
future.
https://www.pmi.org/learning/library/outsour
The University of Sydney
cing-project-management-services-7150
Cons
– Commitment (buy-in) and resources
required internally, even though
external resources are used
– Relationship with vendor needs to be
managed otherwise no benefits are
accrued
– Because ownership of resources does
not exist with client, vendor can
discontinue the relationship
– Depending on the nature of the
project, data security may be
compromised
– May cost more if the relationship does
not work out.
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 Functions or Processes that Can Be Outsourced?

– Planning—WBS and schedule development, preparing cost

estimates/baseline, quality and risk planning, tool/software
support
– Monitoring and controlling—analyzing/control schedule and
cost, reporting status information, tool/software support,
project management information systems, project audits, and
earned value analysis
– Closing—post project appraisal

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 Outsourcing types

– Offshoring
– Rural sourcing—Rural sourcing is the movement of a business process
(in whole or in part) done at a company to another company located
in a lower cost setting within the same country
– Nearshoring
– Multisourcing, or best-of-breed sourcing—Outsourcing can involve a
number of different types of outsourcing (for example, nearshoring,
offshoring, and rural sourcing); this is called multisourcing, or best-of-
breed sourcing
– Insourcing—Insourcing, the opposite of outsourcing, is the movement
of a business process within a company to an internal entity (inside
the same company) that specializes in that operation

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The University of Sydney Page 7
 Virtual Team Management

https://www.star-knowledge.com/blog/virtual-teams-
challenges-and-solutions/

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 Virtual Team Management … key issues?

More worker are now working virtually (covid era)

– Rewards and punishment are more difficult to assess and deliver, so
using either for team improvement is limited.
– Researchers estimate that 90 percent of communication is nonverbal,
transferred by body language and facial expressions.
– Cultural awareness is necessary when part of the team is located in
another country.
– The technology a virtual team needs to use to communicate can be
complex or may not work when needed.
– Time zone differences make it difficult to work, regardless of the
technology, when part of the team is 8 to 10 hours different.
– Language barriers can crop up, even when everyone is speaking
English. Depending on the clarity of the technology and the speaker, it
can be very difficult to understand each other.

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 Overcoming the issues

– Be culturally aware of all who are on the team

– Use a formal standard project methodology and
communicate it to all participants
– Pick the right technology for the situation (email,
phone, instant messaging, blog, teleconferencing,
videoconferencing, zoom, etc.)
– Support effective collaboration on projects
– Host regularly scheduled status meetings
– Communicate, communicate, communicate.

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