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Ways to Maximize IT Outsourcing Deals

by: Sarah Joson

Monday, June 22, 2015 |

Today’s IT outsourcing deals are being inked left and right. Large, long-term deals used to rule the IT outsourcing space, but nowadays, these types of deals are considered impractical and a waste of time. IT companies are now seen dividing major operations into smaller ones, which are then subcontracted to niche providers.

If companies were to outsource to a single provider today, others will consider it risky or a bad move. Even experts believe that having a single provider is not the best strategy for a long-term project. Specific technical expertise that a firm needs might not be covered by the provider and large providers might not be the best candidates for testing and development, or they may be good testers and platforms for development but do not have the adequate management and transition teams.

Ways to maximize IT outsourcing operations

A post at CIO.com suggests ways on how companies can maximize and optimize their IT outsourcing operations:
Multisourcing is not always the best option.
Some transformative and enterprise programs may not be compatible with multisourcing, or the process of outsourcing a specific division/function to several providers. For instance, certain specific and complex functions such as software solutions or software-as-a-service platform are best to be done in a single-provider approach. The life cycle of the operations is redundant with minimal updates and changes, and is more focused on agile configuration and testing.

Properly address risks.
Large-scale and long-term IT projects must rule out all the issues that could lead to problems in the future during the planning and contracting phase. One way is to ensure that you, as the client, will only be billed for the things that you specifically asked for, and are delivered well within your stipulated conditions and agreement. Also, if you feel that you can gauge the operation well enough to make estimates, then do so by limiting the scope of work and deliverables of the outsourcing provider.  

What you would want to do is create a strategy that will add value to your ongoing operation, while watching out for the major drawbacks that can happen in a single-provider partnership. Consider the rates, discounts, management structure, resource and staffing requirements, performance structure, and commercial terms.

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