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Home » Articles » Summary: Smartsourcing – Thomas M. Koulopoulos

Summary: Smartsourcing – Thomas M. Koulopoulos

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SMARTSOURCING Book CoverSMARTSOURCING by Thomas M. Koulopoulos 

Driving Innovation and Growth Through Outsourcing


I. One Sentence Summary of the Book

Smartsourcing done right could lead to massive savings and could help you with your business.

II. Book Overview

Outsourcing is the most popular movement and innovation nowadays. According to Koulopoulos and Roloff, many companies are not doing the right approach when it comes to outsourcing. Therefore, not utilizing its full benefits.

Smartsourcing is a level up in outsourcing. Yes, traditional outsourcing minimizes costs by transferring the work to where the workers are inexpensive. However, this simply recreates the status quo. Smartsourcing, on the other hand, takes a step forward by teaching companies how to partner with service providers to not only reduce costs but to increase innovations in the full extent of their businesses.

It is vital to revisit a company’s processes if you are planning to do a smartsourcing strategy. It is important to determine which are core and noncore processes.

III. Recommended for

Outsourcing is a trend that is here to stay. At least, as long as companies are saving money by hiring other companies to manage other parts of their business, even as they continue to perform their core competencies. This book emphasizes the reasons and principles of outsourcing.

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The book covers a complex topic but it will help you take a hard look at your outsourcing strategies. This will help you identify and fix the gaps to improve the way you do outsourcing.

While some concepts are somewhat difficult to grasp, executives and managers can learn a thing or two about outsourcing. This is highly recommended for business executives, managers and business owners to help their companies save costs and compete.

This book will also help you understand and apply the concept of smartsourcing. This book is also recommended for startup companies who want to save costs.

Thomas M. Koulopoulos IV. Author Biography

Thomas M. Koulopoulos is the CEO and founder of the Delphi group. He is a well-known expert on the implications of information technology on global organisation. His articles and insights are frequently featured in international print and broadcast media such as Business Week, The Wall Street Journal, Forbes, The Economist, CNBC, CNN and NPR. He’s also been a guest lecturer at the Boston University School of Management and Harvard University

 V. Lessons

1. Employees and local jobs

Employees should not be alarmed that outsourcing would away their jobs. A company that designates its noncore tasks and processes and tasks to an outsource partner has more time and energy to prioritize on improving its core competencies and activities, therefore creating more jobs.

Whenever a company outsources, a noncore process is designated to another company. This is called “lift and shift”. Outsourcing partnerships frequently create separate companies rather than doing a collaboration. Outsourcing streamlines operations, it is part of smartsourcing, which streamlines the process including the outsourced function.

“Smartsourcing is the evolution of outsourcing to a more sophisticated and effective model of working with all of your partners and processes – not just those that are most easily transported to an outside party.”

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2. Key Components of Smartsourcing

The basic premise of smartsourcing is that it simplifies an organization by allowing it to focus on what’s most critical for the business.”

Economy of scope

  • Lower risks for companies
  • Improves performance
  • Smartsourcing can save money in different areas

“Shift from ownership to strategy”

  • Instead of concentrating only on products and services, companies shift their focus to strategies.

“Placeless job”

  • Smartsourcing brings work to the people who can do the best jobs at a fraction of the original cost.

SMARTSOURCING DASHBOARD – Is an evaluative tool to determine which processes the company should outsource.

“Smartsourcing is not just about technology; it’s about how businesses are run.”

VI. Other Learnings to look out for

  1. The right approach when it comes to smartsourcing
  2. How to balance offshoring and outsourcing
  3. How to make and use a smartsourcing strategy.

VII. Personal Takeaways

  1. Smartsourcing is not a new or unrelated idea but an evolution or a step further from outsourcing.
  2. Businesses should change or should learn how to change how it operates or does business in order make smartsourcing work for them.
  3. Smartsourcing is transferring a defined task or process from your business to an outsourcing partner.
  4. Outsourcing your nonessential processes reduces costs and boosts innovation.
  5. Choosing which process to outsource and is vital.
  6. Majority of firms that choose to outsource only do it to save costs.

VIII. Final Words

While outsourcing is very important and minimizes cost, smartsourcing, when done correctly, can help a company save even more money while continuously performing their core competencies. This book teaches us how to balance offshoring and outsourcing. It also teaches the concept of smartsourcing and the correct approach.

For more details about the author, you may check the link below.


IX. What other people are saying

  1. This is a great book about the fascinating current trend in the global market

This is a great book about the fascinating current trend in the global market. Personally, one point I found interesting was about innovation; it gives us a new outlook on outsourcing and off-shoring.
In our company we are talking about “Right Shore”: the right resources at the right location at the right time. If reorganization is done successfully and strategy is right, then come Right Shore and smart-sourcing. They leverage the capacity, capabilities, cost advantages and competencies of your company across geographies.

  1. An excellent view on outsourcing

The book takes a slightly different tack on how outsourcing should be viewed and how companies should use it. The overall effect is a little like that described by Hagel and Seely-Brown in The Only Sustainable Edge, but Tom writes a very readable book covering three key trends, all described cogently and without too much MBA-speak. In particular he does a good job contrasting outsourcing and smartsourcing – there is a focus on differentiation over commoditization and on strategic excellence combined with agility (one of my favorite topics). Anyway, the book outlines three themes:

Movement to external economies of scale, Shift from ownership to strategy, The evolution of the placeless job

The overall approach can best be summarized by one quote from the book where he says that an “organization’s intellectual resources are maximized because they are not distracted by nonessential work”.

A highly recommended book.

  1. Tom sees the future before us again.

Tom has again taken a topic that is critically important for any business and created a lucid set of guidelines for doing outsourcing the smart way.

Every business (and individual for that matter) is going to be affected by the trend, so we might as well get it right. Tom’s provides a roadmap that will benefit us all in innovation and results. He’s right, the United States cannot compete with the world just on price alone. Smartsourcing will become a trend amongst those not just outsourcing, but doing so with intelligence.

  1. Mind-blowing

Driving Innovation and Growth Through Outsourcing
Smartsourcing by Thomas M. Koulopoulos and Tom Roloff – is sub-titled ‘Driving innovation and Growth through Outsourcing’ this goes straight to the point which seems to be an habit of the authors who does not beat around the bush and dive directly into the nuts and bolts of their subject, which makes Smartsoucing a very insightful read.

  1. A “must” read for all 21st century business decision makers

I was looking for a book about “outsourcing” and came across this title. “Smartsourcing” I said. What’s that? Intrigued, I bought the book. I’m glad I did. It opened my eyes to a new dimension in business thinking. If you are planning to outsource or want to be an outsourcer, this will change your perspective of this evolving industry. If you have said “no” to outsourcing and want everything done internally at your company, this book will change the “no” to “yes” for some aspects of your business. Reading this book may mean the difference between success and failure in the 21st century.


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