The state of IT sourcing mid 2013 - Part one: innovation through outsourcing

I was at the Forrester conference this week following the track focused on outsourcing. I have written an article following the event that looked at the importance of supplier management in today’s world of multiple suppliers.
This, which you can read here, basically covers the presentations I attended. The article looks at how supplier management is becoming more complex as new technologies, delivery models and suppliers come to market with technology to address business challenges.

But I thought I should blog some of my observations. So here is the first. I really want to get some feedback about each of the points I mention, so feel free to leave your comments.

There was an interesting point made about innovation. Businesses lament the difficulties they face getting IT service providers to innovate. Even when it is part of the initial agreement businesses struggle to get service providers to genuinely innovation. Having said that innovation is a very difficult for any business to do? I mean it isn’t that easy to identify innovation.

I was talking about innovation in outsourcing with Forrester analyst Lutz Peichert at the event. He said Forrester is seeing more companies investing time and money in getting innovation from service providers. It is in the service providers’ interests to innovate these days both for their own business, to make them more effective at delivering services and also to help them win business.

His advice to businesses for getting innovation from suppliers is this: “Understand the capabilities of the supplier and put the people at the supplier in contact with the right people in the business.” This makes sense because there is no point a procurement executive talking about innovation to an IT expert. It should be the person that could benefit from innovation that should be involved in that debate.

Let me know how you get suppliers to innovate. Or if you are a supplier let me know what you want from your customers to help you innovate.

Here is an article Forrester analyst Wolfgang Benkel wrote for Computer weekly last year about. Innovation in Outsourcing Relationships.