Glossary of terms

This glossary is intended to assist you in getting a general understanding of commonly used terms and concepts when dealing with outsourcing and outsourcing governance. We welcome your contribution to further improve and expand the glossary.

# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
There are currently 21 names in this directory beginning with the letter G.
Gain sharing
A technique for sharing risk and reward on a long-term basis. Euphemistically, gain-sharing is not labeled as risk sharing, so care must be taken to identify what is being shared and why.

Gain Sharing Pricing
Pricing mechanism where the compensation to the service provider is based on some measure of the value delivered or the profitability of the customer enterprise. The contract is structured in a way where both the customer and provider share financially in the value created through the relationship

The General Data Protection Regulation (GDPR) (Regulation (EU) 2016/679) is a regulation by which the European Parliament, the Council of the European Union and the European Commission intend to strengthen and unify data protection for all individuals within the European Union (EU). It also addresses the export of personal data outside the EU. The GDPR aims primarily to give control back to citizens and residents over their personal data and to simplify the regulatory environment for international business by unifying the regulation within the EU.

When the GDPR takes effect, it will replace the data protection directive (officially Directive 95/46/EC) of 1995. The regulation was adopted on 27 April 2016. It becomes enforceable from 25 May 2018 after a two-year transition period and, unlike a directive, it does not require national governments to pass any enabling legislation, and is thus directly binding and applicable.

General & Administration Outsourcing (GAO)
Transfer of ownership of some or all general and administrative processes or functions to a service provider. This could include Finance & Accounting, Human Resources, or Procurement related processes or functions

General allocation system
The opposite of "Chargeback systems." An accounting system that allocates the expense for a given service by factors other than actual usage — such as business unit revenue

General and Administrative (G&A)
​General and administrative function, not regarded as primairy business functions, includes Finance & Accounting (F&A), Human Resources (HR), and Procurement

General Management Staff
Employees (other than expat staff and support staff) that do not support the actual delivery of work but are involved in the management of the delivery center. (e.g., Chief Operating Officer, Head of Service Delivery, Quality Manager)

Global buyer
Buyer entity having operations in at least two continents

Global contract
A contract in which delivery occurs on multiple continents

Global delivery model
Using personnel from all over the world to provide maximally efficient service delivery

Global In-house Center (GIC)
Global In-house Center (GIC) also referred to as Captice Center Offshore companies set up by organizations to provide internal services and in some cases to sell those same services to clients. Often U.S. and European organizations set up captive centers for their outsourced work

Global scope
Geographic scope of an outsourcing transaction where delivery occurs in multiple continents

Global shared services model
Also known as captive centers or offshore insourcing, where the objective is to consolidate the scattered, autonomous internal service operations of a multinational organization into multiple service centers, serving a specific region of the world

Global sourcing
Global Sourcing refers to a strategy wherein services are sourced from a country (or countries) different from the country (or countries) where the company receiving the services is located. It includes both offshoring and near shoring

Global Transaction
A transaction where delivery occurs on multiple continents

Governance refers to a coordinated set of activities and methods that is used to oversee and manage all aspects of an outsourcing relationship with the objective to reduce risk and maximize value from the engagement.

Governance cost
The cost incurred by the retained organization to manage the outsourced relationship

Governance plan
A formal governance document designed to guide and control the execution of a sourcing engagement. A contract govenance plan is critical to the success of the engagement and is the most important document that needs to be created when entering into the operational stage of the engagement.

A sourcing governance plan should typically answer the following basic questions:
• Why? - What are the critical objectives of the engagement?
• What? - What are the activities required to meet the contracted obligations? What are the main products or deliverables?
• Who? - Who are responsible for delivering and accepting the products and/or deliverables?
• When? - What exactly service delivery schedule, when can milestones be completed and what are the associated payments?

A key element of the sourcing governance plan is the Performance Control Plan which will be detailed and maintained when the risks and Controls have been identified in consultation with the service provider.

Governance system
A governance system is a set of interrelated or interacting elements that the client and service provider use to maximize the value from their engagement whilst minimize risk and costs

Grid computing
See on-demand computing.
The concept of grid comes from the electricity industry. The electrical grid is a network of infrastructure components that generate, transmit, and distribute electricity. By analogy, by flicking a switch, you can have the outsourced business services flow directly and instantly to your office.

Gross savings
The annualized savings accruing to a buyer due to labor arbitrage benefits and productivity improvements arising from offshoring