Companies initiate outsourcing exercises for many reasons, with cost reduction at the heart of most if not all of them.  Despite the fact that cost reduction is central to many initiatives, the catalyst for outsourcing varies from company to company. In some cases, outsourcing initiatives begin as a “top down” mandate from corporate executives. To be prepared, CIOs should conduct a proper investigation of information technology service delivery in the context of outsourcing as part of their annual planning and budgeting process.

“We find that successful CIOs actively evaluate outsourcing options on a regular basis, especially during lean times, when cost-cutting is paramount,” said Ben Trowbridge, CEO of Alsbridge.  “When senior business leadership asks about outsourcing, these CIOs typically have already conducted a detailed evaluation and are prepared to address very specific questions about the relative merits of various options. Rarely do these CIOs have to defend themselves against claims of significant cost reductions when the outsourcing mandate comes down from above.”

Further, Alsbridge advises that all senior executives, including CIOs, should evaluate outsourcing alternatives on a regular basis using a suite of tools prepared specifically for this purpose. These tool-kits aid in the preparation of critical analyses including detailed baselines of current IT expenditures, market pricing evaluations or benchmarks showing what services would cost from third-party providers, and unbiased evaluations of critical services, identifying those that have the highest potential for value or suitability to be sourced to a third party.

The article concludes by advising executives to address three areas of sourcing economics in all business cases:

Procurement and negotiation

Market price comparison

Risk evaluation

The article "Don't Get Outsourced! Proactively Evaluate Your Sourcing Options” is the latest article published by Alsbridge in the online journal of sourcing topics, Outsourcing Leadership, at http://www.outsourcingleadership.com/.  IT, sourcing, and financial professionals can access hundreds of informative and educational articles, white papers, and archived webinars at Outsourcing Leadership. Alsbridge provides consulting services to help CIOs prepare analyses and business cases for all types of sourcing strategies, including outsourcing, shared services, and benchmarking.  Executives who are actively planning sourcing projects should call (214) 696-6410, email inquiry@alsbridge.com, or visit http://www.alsbridge.com/ for more information. 

About Alsbridge, Inc.

Alsbridge, Inc. is an award-winning global advisory firm, providing unparalleled expertise in outsourcing, shared services, and benchmarking. The firm is fact-based and client-focused, with a proven methodology that fosters success.  Alsbridge defines client goals and scope, finds the best cultural fit with providers,
refines the best solutions and eases transitions and implementation. Founded in 2005, Alsbridge is the proven, effective difference. For more information, visit http://www.alsbridge.com/.

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Contact:

Don Montgomery

Alsbridge, Inc.

Office: (214) 696-6410

inquiry@alsbridge.com