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Are Benchmarking Clauses in Outsourcing Contracts Worth the Effort?

Category:   Benchmarking  IT Infrastructure & Applications  Finance & Accounting Services...

Anyone who has negotiated an outsourcing contract knows that one of the most contentious issues tends to be the benchmarking clause. How often should the price and service be benchmarked? By whom should it be done? Against what data should performance be compared? Who will pay for the market comparison?

Supersize Your ITO Benefits through Benchmarking

Category:   Benchmarking  IT Infrastructure & Applications  Outsourcing

With the shadow of the global economic crisis casting a pall over the global economy, virtually every corporation is struggling to find ways to streamline operations, cut cost and become more efficient. Many of the largest corporations continue to engage in outsourcing to reduce expenses and focus on core competencies.

Opportunities and Challenges of Multi-process Outsourcing

Category:   Strategy & Business Case  Business Processes  Outsourcing...

Anyone who has been involved in an information technology (IT) outsourcing transaction knows that such transactions require careful planning, analysis, negotiation, execution, management, and complex legal agreements.

Tap the Full Potential of Outsourcing with Advanced Vendor Management

Category:   Transition & Governance  IT Infrastructure & Applications  Outsourcing

Advancing your organization's vendor management practice is essential to tapping the full strategic potential of your outsourcing investment and leveraging continuous improvements in your vendor's process and technology capabilities.

CIOs today are depending on vendors to deliver a larger portion of their IT service portfolio and play a pivotal role in improving corporate IT practices. Because critical business processes are now more tightly coupled with IT services than ever, it's imperative for CIOs to create a core competency for managing vendors and maintaining a productive vendor relationship. An advanced vendor management capability can help an IT organization avoid the risk of being held captive or reliant on any one provider or by paying rates that are not in line with the market.

Today's outsourcing deals are of shorter duration than in years past. At present, deals are typically signed for 3-5 year terms whereas 10-15 year terms were common in the not-so-distant past. Given the need to rapidly and efficiently integrate and leverage a vendor's services into an IT organization, it's important to develop an advanced vendor management capability. Otherwise, an outsourcing buyer never realizes the true value of their investment and is ill-prepared to monitor the market (price, service levels, etc.), renegotiate, or efficiently migrate services to another outsourcing provider without taking a step backwards.

The new directive on outsourcing for CIOs is to look beyond the traditional advantages of labor arbitrage to ensure they leverage their vendors for innovation and sustainable transformational efficiencies. The internal IT organization must become more effective at integrating vendor capabilities and continually aligning them to reinforce changes that enable the business to adjust to dynamics in their economic environment. For CIOs to be successful in this endeavor, it requires advancements in vendor management capabilities, both in terms of leadership and structure.

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