Free Newsletters [dotclear.gif] [dotclear.gif] [idg.us.cioarchives;pos=top;sz=468x60;ord=?] [dotclear.gif] [dotclear.gif] [dotclear.gif] [dotclear.gif] * Leadership * Enterprise * KM/Storage * Security * Industries * Sourcing * Technology * Career Budgeting CIO Executive IT Value Leadership & Management CRM E-Business ERP SCM Data Storage/Mining Intranet/Extranet Knowledge Management Government & IT Policy Legal Security & Privacy Financial Health Care Nonprofit Retail Outsourcing Staffing & Retention SOA Emerging Technologies Infrastructure Wireless Career Counselor CIO Executive CIO Wanted Future CIO * CIO.com * Archives * Research * Columns * Blogs * Newsletters * Search In This Edition Success in Outsourcing CIOs share business rules that work. Ethical Outsourcing You are still responsible for how operations are run. Using Analytics for Competitive Advantage Theres a right and a wrong way to use them. How to Do Customer Segmentation Right By courting specific customer segments, RBC Royal Bank has grown its market share. The 6 Keys to Business Alignment Lasting value for your business partners. Rules for IT Three CIOs have created rules for their staffs to follow. Disposing of Hard Assets Getting rid of your old computers is more complicated than you might think. The Looming Security Crisis Ed Lazowska, of the Presidents Information Technology Advisory Committee, says the government, vendors and CIOs arent doing enough. OCTOBER 1, 2005 | CIO MAGAZINE KEYNOTE Outsource, Don't Abdicate Regardless of what business processes you move outside your corporate borders, you cant lose sight of your ultimate responsibility for ethics and the end result. BY BEN GOMES-CASSERES Advertisers IFRAME: http://ad.doubleclick.net/adi/idg.us.cioarchives;pos=center;sz=336x280;tile=4;ord=? [idg.us.cioarchives;abr=!ie;pos=center;sz=336x280;tile=4;ord=?] IFRAME: http://search.idg.net/custom/relatedcxo/query.html?&col=latest&qt=+ outsourcing vendor consultants staff foreign-worker contractors off-shore overseas H1-B visa +%2Burl%3Acio&nh=3 IFRAME: http://search.idg.net/custom/relatedcxoidg/query.html?&col=latest&qt=+ outsourcing vendor consultants staff foreign-worker contractors off-shore overseas H1-B visa +-url%3Acio&nh=3 My favorite post-Enron cartoon, by Dan Wasserman, has two captains of industry discussing what to do about the fallout from corporate scandals. "We are seen as ethical disasters," says one of them. "How are we going to rebuild public trust?" In a flash of brilliance, the other answers: "We could outsource it!" Behind the sarcasm there lies an interesting question: When a company sheds operations through outsourcing, does it also shed its responsibility--ethical and otherwise--for how those operations are run? Companies today rely more and more on partnerships with third parties for everything ranging from supplies and manufacturing to product design and distribution. In this so-called extended enterprise, where does management's responsibility for good governance begin and end? Lawyers and accountants will surely have an answer (or several) to this question, based on their reading of Sarbanes-Oxley and other regulations. But top management's answer should go beyond current laws and professional practices, as the question also relates to performance, reputation and, yes, even ethics. Corporate governance, writ large, means how and to what ends top management exercises its authority and influence. But authority over what? The financial statements of a company begin and end at the legal boundaries of the company's property. What it owns or controls is included; what it doesn't, is not. The problem is that partnerships and outsourcing often fall in a gray zone--they are not usually owned or controlled by the company, but they can be critical to its economic performance. In effect, the economic boundaries of the company stretch well beyond the legal boundaries. And it is this broader economic scope of operations that companies should govern well, not just the legally defined core. Those who don't, risk suffering penalties--perhaps not legal penalties, but penalties no less in their performance, their brand reputation, or in the public's perception of their ethical integrity. 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Submit Comment CIO.com Comment Policy Site Tools * - Printer-friendly * - E-mail this * - Subscribe to CIO * - Request Reprint * - Reader Comments Related... Articles Outsourcing * Taking Mobility Beyond E-Mail: Build or Buy? What you need to consider when deciding whether to develop mobile systems yourself or purchase solutions from a provider. * Offshore Outsourcing Guide - 2006 Global Outsourcing Guide Risks, rewards, challenges and opportunities, country by country. * Career - The China Gambit China, starved for executive talent, is importing CIOs from the West. And discovering how IT works--and doesn't--in this emerging factory to the world is supercharging their careers. * Risk and the CIO It may be time for Uncle Sam to step in and help manage corporate risk from global disasters, but that doesn't mean CIOs don't have a job to do in the meantime. More on Outsourcing... 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