After years of disappointment, organisations are
sceptical about outsourcing companies’ pitches that are concerned
with innovation, says analyst Ovum.
The use of the word innovation has grown dramatically among IT
services suppliers in the last six months, said Ovum. However it
seems that both clients and the players within IT services have
different ideas as to what innovation is, and what it should
deliver, said the analyst.
“The challenge is in the mismatch of vendor/client expectations
and in the limitations of the contractual arrangements. This often
means that the clients can be unhappy even when vendors deliver on
all of the agreed metrics,” said Angel Dobardziev, an Ovum
analyst.
Discussions between Ovum and 11 major western and Indian IT
players around innovation revealed that the majority of suppliers
have different and often conflicting ideas as to how they think
clients define innovation. The clients involved also seemed to have
different expectations from suppliers in terms of innovation.
“Clients will talk about, and demand, innovation but what they
are really after are outcomes,” explained Dobardziev.
“Vendors should focus on these desired outcomes and take time to
understand the different and often conflicting needs of various
clients.”
Both sides must work closely together every step of the way,
from defining innovation expectations to agreeing the measures to
track progress, said Ovum.
This will mean ensuring an equitable approach to the sometimes
tricky issues of risk/reward and intellectual property in
innovative engagements, said the analyst.
“If you really want valuable innovation to be delivered as
everyone expects, the deal should be treated as a partnership. It’s
not enough just to say that a vendor/client relationship is
strategic, you have to be prepared to invest in the relationship -
if you don’t, then you’ll have an old-style customer/supplier
relationship on your hands,” said Dobardziev.
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