Tony Morris Quoted in Canadian Lawyer In-House Magazine on the challenges of Global Outsourcing
Canadian Lawyer In-House MagazineAugust 2008
The increased risk for outsourcing deals to potentially go sour has caused the growing complexity of outsourcing to quickly become a hot topic. In the August issue of In-House Magazine, the feature story "Outsourcing grows in Complexity" explores past deals that have fallen through to uncover best practices for renegotiation of contracts or switching providers altogether. Tony Morris, Partner in Macleod Dixon's Calgary office, was quoted in the article where he expanded on the issue of who will bear the brunt of winding down a bad deal.
"Corporate Counsel often-times gets side-swiped with the responsibility for the fallout of contracts that are not managed very well, and they end up having to jump in and take responsibility in a way that is a real challenge," he comments. "And it is somewhat unfair."
Morris, whose outsourcing clients tend to stay within North America , cautions the concerns are still the same as if they were looking to procure services overseas.
"Outsourcing is really different from the other service agreements. You have to think 'convey' and 're-convey.' These are contract deals that need a heavy dose of managing and fine tuning, either during the course of the transaction or during the course of the service delivery. At the front end of the agreement, the company may be looking for cost-saving or functionality improvements although you've always got to think about how to unwind that deal. Corporate counsel needs to understand the implications to the business in the long term."
"I think the most valuable thing that I try to do when I engage with in-house counsel who've had a bit more experience in outsourcing is how to make the deals work in the longer term,' comments Morris. "Sometimes that's not much in the way of legal advice at all."
He further goes on to say that it is important to adopt the big-picture approach in viewing the operation as a whole, to weigh variables that can impact any single aspect of business. And that is why outside advice is most valuable, as when the dust settles "corporate counsel ends up living the consequences after the contract is signed," he states. " If they are involved in the deal then they are the folks who live the actualization of the contract, good or bad."