Outsourcing begets more outsourcing.

That's one conclusion of a global study--Outsourcing In Government: Pathways To Value--issued Thursday by management consultant and IT services provider Accenture on government's use of outsourcing. "As governments become more experienced with outsourcing, they seek new ways to derive greater value from these arrangements," says Steve Rohleder, group CEO of Accenture's global government practice. "Therefore, they're more inclined to outsource processes such as procurement, finance and accounting, and human resources, which were previously considered too critical to outsource."

The study, based on surveys and interviews with more than 150 top officials in 23 governments in Asia, Europe, North America, and South America, found that nearly 90% of respondents deemed outsourcing activities as important or absolutely critical to their missions of delivering services to their citizens. In addition, the study revealed that governments outsource mainly to improve the speed or quality of the service they provide. Among activities and services that governments often outsource: staff training and education programs, finance and accounting, human resources, and supply-chain operations, as well as IT applications and infrastructure.

At least 70% of respondents who outsourced to gain access to new technology or expertise or to centralize or standardize operations said these objectives were mostly or fully met. In comparison, only half of the executives who said reducing cost as their prime motive to outsource expressed similar satisfaction.

Other findings of the study:

• Governments that have used outsourcing to change the way they operate were more inclined to engage in business-processing outsourcing than those that used outsourcing to cut costs. More than two-thirds of respondents who outsourced to transform their agencies said they achieved change by outsourcing business processes.
• Governments usually outsource to achieve two objectives: change government operations to improve citizen satisfaction and address severe budget deficits or create efficiencies through cost reduction and greater productivity.
• Great Britain has amassed a broad portfolio of capabilities for managing outsourcing contracts while achieving greater value from the money government spends on outsourcing. The United States and Canada were close behind.

In the United States, Rohleder says, the Department of Homeland Security and its agencies and the state of Florida are among the most aggressive government entities to use outsourcers as a vehicle to transform how they function.

Tom Healy, Accenture's partner responsible for global government outsourcing, says a primary reason governments turn to outsourcing is because they're under pressure to move rapidly and lack the in-house skills and technology to get solutions up and running quickly.