Getting staff outsourcing right

In 2005, 3UK announced that it would outsource the running of its network to Ericsson. More than 1000 staff would move from 3 to Ericsson as part of the managed services deal.

Neil Clark, Service Delivery Human Resources Department at Ericsson UK, is keen to stress the importance of people management in such deals. “It’s crucial. If the transfer of the people does not work well, it can derail the whole project and put the transfer of the service at risk,” he says.

Clark witnessed the transition from both sides: he used to work for the mobile operator 3 before taking up his new role at Ericsson.

He says employees were given very short notice of the transfer to Ericsson because it may have affected the stock price of both 3’s parent organization, Hutchison, and Ericsson.

“You need to manage the situation within the boundaries you are given,” Clark says of the short timelines.

Once 3’s staff were informed, however, every effort was made to allay their concerns and make the transition as smooth as possible.

“Both companies worked in true partnership to ensure that communications were strong and aligned. We also worked well together to ensure minimum disruption to people at the point of transfer,” Clark says.

The companies made sure to notify all employees via joint company presentations before informing the stock markets in Stockholm and New York.

Ericsson has now developed a solid reputation across the business world for its ability to manage outsourcing deals.

“One customer is considering outsourcing more business to us,” Clark says. “One of the key things they felt we did extremely well was transferring their staff. Specifically, the customer felt that the success was attributable to three main points: excellent and regular communication; joint workshops to discuss how the transfer will happen; and total transparency about the communications.” 

He describes Ericsson’s blueprint for staff outsourcing as “second to none.”