Pay, Ask and Prepare

Commented the post IT Outsourcing Customers Get What They Pay for, Not What They Want by Stephanie Overby (@stephanieoverby) on CIO.com.

Short break out:

"When asked to rate their own talent, outsourcing buyers consider themselves strong in tactical areas such as contract negotiation and service provider selection but weaker in the more strategic fields of improving analytics, driving innovation, and defining business outcomes beyond cost savings. 

These talent gaps in outsourcing partnerships will come to the forefront in the coming year, says HfS Research CEO Phil Fersht. Outsourcing customers cite cost reduction as the most important driver for outsourcing decisions--43 percent of respondents label it "mission critical.""

My comment:

This is truly a bidirectional issue. I would like to rephrase: IT Outsourcing Customers Get What They Pay ASK AND PREPARE for, Not What They Want. Customers don’t prepare well enough and they often ask Nirvana-questions which outsourcing can’t ROI. The problem: far too often a professional sourcing advisor managed the procurement project – customers still do not get what they want (not acceptable). Or; the customer didn’t listen to the advisor and/or the ITOP/SP. At the same time ITOP/SP's don't argue their services well enough - bespoke ITO is bad for business and ROI. Remember; price war is bad too. On-site, off-site or as cloud, you name it; IT is not for free! Customers and sourcing advisors; do your benchmark well enough when choosing ITOP/SP. And sometimes the ITOP/SP just BS-ing you in the procurement phase so my tip of the day: demand General (& soft) SLA too, not just Specific (services connected) + drop some of the demands, instead you should let the ITOP/SP propose an alternative solution.