Heart of the matter

"I heard that the chief executive [of the outsourcer] was beating up his team on having failed to win the renewal. I invited him to dinner and said that in the three years with us they had changed strategy from being low-cost and fast-moving to having significant overheads and, therefore, they no longer had alignment with what I wanted.

"So I told him, it's not your team's fault, it's your fault. I got a nice letter from him later saying he would never beat up his team in that way again. In outsourcing, a CIO has to have a strong understanding of alignment with partners. If it's not there, tell them, warn them, debate it and do something about it."

Sykes also used a good trick when it came to negotiating with an outsourcing partner, drafting in a merger-and-acquisition specialist to help do the deal and dispensing with the usual request-for-information (RFI) element of the process.

"Usually, you did an RFI, got a large number of replies to get a shortlist and then did an RFP -- a request for proposal," he says. "We never once did an RFI but we did our own market research to get down to three or four players. That way, we were more likely to get a strategic fit. Our opening line was 'We've saved you an RFI and we have a business proposition...' We always wanted a market-based understanding rather than having the classic situation where the outsourcer shifts and changes and does everything to win the deal because the company they work for has this deal-making culture."

In some ways, Sykes's ICI helped create a template for today's shared-risk/shared-reward arrangements.

"What we always wanted was an outcome-based relationship where you worked as a combination with the same ideas. We always wanted to move away from 'classic' outsourcing deals."

In recent times, of course, outsourcing has changed hugely, thanks to globalization and the India effect. Is Sykes a fan of offshoring? The answer is mixed.

"The IT outsourcing movement grew up from companies with a very strong technology offer, that slowly learned how to be facilities management operators. What the Indians have done is to come in and leverage world-class talent at a cost base much lower than Europe or the US. They have taken the old model but what they haven't done is innovate on that model. Some people have taken outsourcing into front-line call-center work, egged on by the lower cost structure, and have not understood the importance of the culture."

Despite having left ICI in 1999, Sykes has stayed very much involved in technology and business, having been chairman of outsourcing firm Morgan Chambers between 1999 and 2004, taking up several non-executive positions and business consultation roles, and advising on how technology can best be tapped to address social issues.