Forrester: Poor internal IT is ‘prompting outsourcing’

Poor quality internal IT departments is becoming a ever more common driver to outsource, according to Forrester Research analysts.

Cost savings and better IT delivery remain the main drivers for outsourcing, say Forrester, but poor quality IT is increasingly a motivating factor, particularly for management, according to senior analyst Richard Peynot.

“This approach, ‘outsourcing as a sanction’, is risky because its adopters seldom consider the full range of issues involved in driving outsourcing success,” said Peynot.

Following a three-year study with end users and service providers, the analyst group identified common shortfalls in current end user outsourcing strategy, and outlined three key steps businesses should follow to avoid these pitfalls.

First, it said a firm should ensure its outsourcing strategy matches the rest of its IT group structural issues. IT characteristics such as the degree of centralization and the delivery model were foundational issues that ruled out some models and preselected others, Forrester said.

Second, since staff availability for new projects influenced the outsourcing model chose, it said buyers should adjust the targeted outsourcing model or simply rule out some options.

Lastly, it urged that firms ensure that IT context determined the implementation of the selected outsourcing model. It said this should underpin decisions about issues such as which domains may not be suited for outsourcing, or which would require more preparatory work.

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Jim Love, Chief Content Officer, IT World Canada

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