Stop outsourcing and begin multisourcing

Too many IT directors are embarking on outsourcing as an almost reflex action and with inevitably disappointing consequences says analysis and research company Gartner.

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Too many IT directors are embarking on outsourcing as an almost reflex action and with inevitably disappointing...

consequences says analysis and research company Gartner. At its Symposium/IT Expo last week, Linda Cohen, vice president and distinguished analyst warned against such compulsive outsourcing and advised organisations to begin a more disciplined approach to what she calls "multisourcing" in order to achieve business growth and agility, and not get burned. Right now, many firms are so disillusioned with outsourcing that they are actually embarking on an insourcing strategy. Ms Cohen explained to why dissatisfaction was occurring. "Companies make outsourcing deals based on business problems.

"Firms sign 3-, 5-, 7-year outsourcing deals based on today's problems and so in, say, three year's time that problem is solved and the deal is actually not good. There needs to be a whole new way of attacking outsourcing. We are living in a multisourced world where some things are outsourced and some are insourced," she commented.

To Gartner, outsourcing is an innovative discipline that takes organisations beyond quick-fix cost cutting to enable capability building, global expansion, increased agility and profitability, and competitive advantage. As such, multisourcing requires a new mind-set and frameworks for communicating, interacting with, and overseeing service relationships both inside and outside the organisation.

Gartner chose its Symposium to launch a book that Ms Cohen has co-written with fellow Gartner sourcing expert Allie Young called "Multisourcing: Moving Beyond Outsourcing to Achieve Growth and Agility."

Ms Cohen says the book is directed towards CEOs as much as IT directors and aims to shatter a number of myths attached to outsourcing, of which Gartner believes there are eight principal ones: the myth of sourcing independence; the myth of service autonomy; the myth of economies of scale; the myth of self-management; the myth of the enemy; the myth of procurement; the myth of the steady state; the myth of sourcing competency.



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