When the executive is faced with a blank slate the best advice is to begin with the end in mind. What is the desired end-state of the business units and business activities in your area of responsibility?
For some buyers of outsourcing services, thinking about the desired end-state means that there is more time to focus on the activities that bring the most value to customers. Other buyers are looking for relief from activities that are bogging down their own staff or require skills and expertise that aren't available internally. In any case, when considering the best candidates from among the business activities in your area of responsibility, consider the goals and reasons for pursing a change and where your organization can achieve the most value by using service providers. The selection of best candidates is not only based on current productivity issues and sources of "pain" but also on the possibilities of what could be accomplished with a change and a new approach to business.
Six paths are offered for identifying the best candidates for outsourcing among the business activities in your area of responsibility.
Best Practice #1: Select Non-Core Competencies
The first and most obvious candidates for outsourcing are those activities that are purely administrative or supportive in nature—those activities that are the farthest from the business' core activities. For reasons elaborated on elsewhere, business activities and processes that are far removed from the firm's customers and those value chain links that deliver value to customers are prime candidates for outsourcing.