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Majority of CIOs to Modify IT Sourcing Partnerships

by: Sarah Joson

Friday, March 21, 2014 | Outsourcing News |

CIOs to Make Changes in IT Outsourcing Relationships

Results from the latest global survey done by Gartner and recently discussed at SiliconRepublic.com showed that 70 percent of CIOs are looking to modify their sourcing and technology relationships in the next few years.

According to Eric Rocco, Managing Vice-president at Gartner, CIOs are considering switching service providers to keep up with the changes. In addition to that, service providers that are able to assist clients to be more agile with the changes will be taking center stage. Providers should be able to adapt to the demand from the market and consider this as an opportunity.

Rocco added that one of the key drivers of this change is technology, and it’s the type of change that is expected to disrupt the conventional business models and its foundations.

Gartner believes that a provider’s ability to help clients move through the changes that going digital has brought about will expand the majority of IT services opportunities.

The article also pointed out that cost is no longer the main pivotal point in contracts. In fact, with the two rising segments gaining traction in the tech space (cloud-based infrastructure as a service (IaaS) at 44.9 percent and business process as a service (BPaaS) at 12.4 percent), agility will become the main driver for buyers to adopt cloud computing and not cost.   

Clients are expected to shift from traditional data center to infrastructure outsourcing where infrastructure utility services (IUS), will be managed through IaaS technology. As the trends are changing in the cloud computing world, hybrid IT environments will be at the forefront in terms of IT architecture in the coming years. It will be a fusion of traditional IT environments and the as-a-service operating models.

Rocco pointed out that for providers to successfully win clients, they need to understand what drives their business and design their propositions accordingly. He added that some of the angles that service providers can build their recommendations on are to show clients the value of the service to the business, as well as KPI attainment while maintaining innovation.

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