IT law specialist Clare Murray of Pinsent Masons, the law firm behind Out-Law.com, said that cost-cutting requirements and the changing needs of organisations are behind a rise in the number of IT outsourcing contract renegotiations. She said she expects the trend to continue. "Customers are under pressure to cut costs and are …
Aren't they supposed to do this anyway?
Anonymous because I work for a consulting company.
You're better served with effective IT Strategy
With the businesses and the markets changing, if not revenue stream oscillating, a company is better advised not to outsource in first place, and by keeping the IT operations in house. By doing so it has full control over the IT operations and does not need to crosscheck extensively that the service provider is actually doing its job. With an effective IT strategy, ideally based on commodity hardware and software, IT services can be adapted to the changing market situations. Hardware vendors a very good in selling dynamic resource allocations and de-allocations on servers, but they only work for short term, temporary performance oscillations. They fail, however, in long term planning and adaption. I have never come across any IT Architect, or a Senior VP for IT who built in the flexibility of reducing IT operations, even conceptually. This is because program managers and vendors expect growth and nothing else, and the hardware design is practically done by the sales representatives of the hardware vendors.
Funny, tho, the many times I looked into wide eyed execs when I presented the framework to bring chargeable flexibility to IT services. Was it implemented? Of course not, since this idea didn't come from da big wig's mouth and wasn't wrapped between a steak dinner.