Spend Trend Shifts As Outsourcing Moves To Multisourcing

Dissatisfaction with traditional outsourcing relationships is changing the way enterprises and their IT service providers do business. So what’s behind this trend, and how can organisations and service providers take action to address it?

According to Dexter Wee, General Manager iBOSS, Asia Pacific, Infrastructure Operations & Outsourcing Solutions, Datacraft, the swing to Multisourcing is a direct outcome of traditional sourcing strategies that cannot keep pace with rapidly changing business environments and evolving client needs.

“Multisourcing provides options. It allows clients to choose between best-of-breed service providers and select the right sources for IT services in order to obtain optimal business outcomes,” said Wee.

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Wee adds that another key driver behind new approaches to sourcing IT is the fact that business priorities have changed. Organisations are faced with ever-growing expectations and competitive pressures and in this landscape, outsourcing simply to save money is not enough. Also, as technology becomes increasingly complex, clients are finding themselves under pressure to understand these rapidly evolving technologies and find ways to harness them to deliver competitive advantage - all this in a competitive global environment.

Wee outlines four trends that he believes will guide growth and continued commercial success for trend-savvy service providers as Multisourcing goes mainstream:

• Today’s sophisticated clients want service providers to present them with a comprehensive range of modular offerings that allow them to engage at whichever level they are comfortable. Integration of new services, transparent pricing models and upfront agreements will become the order of the day.

• Service providers should offer clients strong and credible sets of integrated but distinct solutions. These include traditional services such as planning, procurement and support, but also extend to services beyond the traditional offerings. A powerful example (Wee cites) is taking ownership of running services within a client’s environment throughout the technology’s lifecycle, thus maximising return on the current IT investment, and integrating new and existing technologies to extract maximum value.

• Service providers must move beyond their traditional role of technology providers, to deliver innovation to their clients. The demand for ongoing improvement will be a critical differentiator in the Multisourcing market.

• The battle for IT expertise and intellectual capital will win the market for service providers. The cost of finding, training and retaining highly skilled engineers in-house is a heavy burden for organisations outside the technology industry. This paves the way for service providers who can offer the human skills and top level resources to dominate the market.

“The Multisourcing approach offers a winning formula: Optimal value creation, combined with innovation, business alignment and return on IT investment – which results in success for both the client and the service provider.” concludes Wee.