InBrief: Workforce and Sourcing Strategy

What It Is: Workforce and Sourcing Strategy is the long-term approach that an organization uses to provide the necessary skills, internal and external, to enable capabilities to deliver on business commitments and support the current and future technology footprint

Why It Matters: Having a deliberate and thoughtful strategy not only creates an agile and responsive workforce to meet ongoing and variable business demand, but also does so at the right cost.  Where a defined strategy is not in place and being governed, there is very likely cost optimization opportunity

Key Concepts

• Business and technology needs fluctuate.  A strategy helps mitigate the cost impact of change
• Leverage a competency model internally and externally to benchmark roles, capacity, and costs
• Generally speaking, it’s better to align variable capacity to areas of variable demand
• Benchmark internal cost of service against best-in-class providers, make adjustments as needed
• Understand that not everything needs differentiated service, keep the lights on is valid in cases
• Invest in areas where technology creates competitive advantage and IP, outsource elsewhere
• Actively manage and govern talent development and performance to optimize productivity
• Never assume HC = FTE.  Used named resources for capacity planning of critical roles vs FTEs
• Source where technology is emerging and immature to facilitate experiments and early learning
• It is a reasonable strategy to engage partners in simplification efforts through mutual incentives
• Never assume shifting sourcing to captives for arbitrage benefits is a 1:1 FTE exchange, it isn’t
• Be mindful in how you manage overall tenure.  Motivated inexperience introduces risk and cost
• Leverage role-based capacity agreements to shift contract labor costs to a defined model
• Scrutinize contracting heavily to avoid inflated cost.  Convert or hire longer-term needs
• Establish consistent contract language that aligns to service delivery roles and expectations
• Define primary and secondary partners for individual sourcing needs, manage them consistently
• Negotiate aggressively but fairly, “partnerships” produce more value than a “vendor” mentality
• Benchmark and leverage consistent performance metrics across internal and external partners
• Apply vendor management and governance processes to captives the same as external partners

Approach

• Understand Current State – Benchmarking capacity by role across sources of staff, including cost
• Determine What You Need – Evaluate business and industry trends, do the same for technology
• Define Sourcing Approach – Identify critical skills to retain and source, and where to get them
• Refine Talent Strategy – Clarify gaps between current and future IT staffing, skills and capacity
• Develop Transition Plan – Plan change to talent pool and make explicit sourcing decisions
• Manage Transition – Define metrics, establish vendor management processes, govern change

For Additional Information: Workforce and Sourcing Strategy – Overview

Excellence doesn’t happen by accident.  Courageous leadership is essential.

Put value creation first, be disciplined, but nimble.

Want to discuss more?  Please send me a message.  I’m happy to explore with you.

-CJG 11/05/2025