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THE LAST THING most CIOs want to think about as they embark on a major outsourcing deal is what will happen when it ends After all reaching the decision to outsource some or all of an organizations IT services requires a great deal of business case analysis transition planning and soul-searching about the best way to handle the many human issues involved Assuming that the organization views the pending transaction as positive or at least acceptable this is a time of high excitement and tension and it may not seem like the ideal time to plan how to get out of this arrangement in a few years But you ignore the end game at your peril Sourcing deals are risky and some of the biggest risks are not visible in the rose-colored days leading up to deal consummation Fortunately these risks will come to light not at the very end of the deal but somewhere midstream as they did a few years ago for me and my colleagues at General Motors GM manages one of the industrys largest IT outsourcing agreements with EDS Many factors make this arrangement unique including the fact that it was created in 1996 when GM divested EDS with the proviso that EDS would maintain a more or less exclusive lock on GMs IT business for the next decade Ralph Szygenda was hired as CIO for GMs newly formed Information Systems Services organization and he hired a couple hundred IT executives and managers including yours truly to drive GMs technology strategy and manage the EDS outsourcing deal I led three organizations in my time there including the operations portion of GM North Americas multibillion-dollar agreement with EDS which is set to expire in 2006 In 2001 the midpoint of the contract we began to analyze the opportunities and risks involved in the expiration of that arrangement While that story has yet to play out the risks we identified are
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