Service Integration and Management or SIAM as it is referred to is in vogue. With large numbers of suppliers offering different services and a propensity for CIOs to multisource makes supplier management an important and time consuming task.
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So tricky for some that it is being outsourced. But should businesses outsource the management of suppliers to one of the suppliers themselves. A real poacher turned gamekeeper.
Ben Barry, director of IT advisory Coeus Consulting, wrote this guest blog post about the risk of outsourcing SIAM.
Service management – it is just too important to outsource
By Ben Barry
“There are some services which might be too important to outsource – service integration and management (SIAM) is one example.
Most large organisations operate in a multi-sourced environment, with different aspects of their technology requirements being handled by different suppliers while others are handled in-house. These contracts tend to have evolved from larger first generation single source contracts, without too much thought on how to effectively integrate and manage the various suppliers.
Why is it necessary? Quite simply because suppliers don’t work well together without someone with authority directing them. It’s a bit like the conductor in an orchestra… when you listen to an orchestra playing without a conductor you realise how important they are!
Due to the lack of maturity in the market place when moving from single source to multi-sourced models, few organisations considered fully how they would integrate them effectively and even worse this was often an afterthought – believing that the suppliers would just get on and work it out between themselves. This often led to a mixed integration model, with multiple parties having responsibilities for different processes.
For many, it is a recipe for disaster and our research and involvement with large businesses across a range of sectors has revealed few examples of organisations managing to make it work well.
A well run service integration function requires a complex framework in order to successfully deliver services to the business, whilst utilising multiple IT suppliers to do so.
Now organisations are understanding the need to create a well-defined SIAM function, their first thought is likely to be that outsourcing is the logical way to deliver it. However, what is logical and what works in the real world are very different.
The first big shock for clients who outsource their SIAM function is when an IT issue directly affects critical business operations. The reality is that suppliers will never feel the pain the way their client does or have the same understanding of the business, meaning the supplier will rarely deal with things as urgently as the client would themselves.
Even if they do, the SIAM provider then hits the second big real-world obstacle – during a major incident when multiple suppliers are involved, the outsourced supplier rarely has the authority or the mandate to coordinate and drive the other suppliers in the way necessary to deliver a quick resolution.
Outsourcing your SIAM function means that you lose control, knowledge and understanding of one of your main levers for driving the business and should not be undertaken lightly. In fact, there are only a few very specific circumstances where it should be considered because of the inherent problems.
There are different approaches to outsourcing your service management, a lot have weaknesses, but for most outsourcing service management is too crucial to be effectively handled by a third party.”
A free white paper discussing this further is available from Coeus Consulting here.