Savvy IT outsourcing customers insist on including <a href="http://www.cio.com/article/29102/Outsourcer_Benchmarking_The_Sanity_Clause">benchmarking clauses</a> in their IT services contracts. Benchmarking clauses are beneficial to outsourcing customers because they allow the customer to bring in a third party to assess the competitiveness of the outsourcer's prices.
"OK. What's Next?" It's the last leg of a three-part agenda Eurpac CIO Mike Skinner uses each time he meets with his staff. Number one: Where are resources invested? Number two: What progress have we made? Number three: What's our next goal? Every meeting. Every agenda. Every time.
When Sprint Nextel announced its plans to outsource network services to Ericsson earlier this month, the statement was notable for a number of reasons. Most significantly, by signing the seven-year, US$5 billion deal, Sprint became the first U.S. telecom provider to contract with a third party for network management. The move was an about-face for Sprint, which is known for its tight-fisted control of its networks.
Most information technology leaders enter into outsourcing relationships with a reasonable understanding of where they'd like their IT services provider to take them-some point in the future where the state of IT has been improved by saving money, increasing efficiency, or implementing new enterprise systems.
There are many matters to consider when setting up an offshore outsourcing deal-scope, location, roles and responsibilities, service levels, governance plans and price, just to name a few.
The offshore captive center was once the Holy Grail of offshore outsourcing. As companies got a taste of the cost savings possible by outsourcing IT and business process work to lower cost countries, they began to salivate over the thought of bypassing the offshore vendors (and their pesky profit margins) altogether and saving even more money by setting up their own service shops in India.
Almost everybody has a theory about how to save the U.S. newspaper industry. The only consensus, it seems, is that it needs to change fundamentally or it could all but disappear. At The New York Times, tough times have elevated IT-enabled innovation to the top of the agenda.
Outsourcing experts, IT analysts (and optimistic vendors) are predicting an increase in IT services deals during the second half of 2009. They foresee an uptick in outsourcing driven by enterprises looking to increase IT efficiency and cut costs.
There has been much discussion about the global economic recession's impact on the price of IT outsourcing services. The consensus has been that buyers keen to cut costs coupled with decreasing demand for IT services would drive prices down across the outsourcing market -welcome news for IT executives under pressure to slash their budgets while maintaining quality.
Once upon a time, IT service providers demanded exclusivity from customers. As those early outsourcing deals wore on, clients grew weary of being locked in to a "one and only" provider. To keep their customers happy, outsourcing vendors began offering minimum volume and revenue commitment clauses, which gave customers some room to breathe while insuring a certain level of return for IT service suppliers.
Several prominent offshore outsourcing customers have made a big show of announcing the cancellation of some of their business process and information technology services deals and what could be described as a "backshoring" of those jobs to the U.S.
Reward good behavior and punish poor performance. Sounds like a commonsense approach to achieving results. And if that tactic works in the chaos of the kindergarten classroom, it seemingly couldn't hurt in achieving desired outcomes when outsourcing.
Egypt has the most market potential among emerging providers of global IT services, according to a recent study by the London School of Economics Outsourcing Unit.
Since Slumdog Millionaire took home eight Oscars earlier this year--inspiring increased interest in many things Indian--2009 has been dubbed by some as "the year of India." But, in terms of IT services, it probably won't be the year of India Inc.
If you have an outsourcing contract for work in Bogota, Colombia, Bangkok, Thailand, or Johannesburg, South Africa, you should be aware that they rank as the riskiest offshore outsourcing destinations in the world. Locations in India and Brazil also made this inauspicious list. Where do you outsource?