IDC probes outsourcing customers

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IDC probes outsourcing customers

IT analyst firm IDC has released its annual report on user preferences and needs for IT outsourcing services. It also delves into the expectations of organisations seeking these services.

The report titled ‘In The Mind Of The Outsourcing Customer: IDC’s Annual Outsourcing Survey 2007’ has revealed that companies are contracting with renegotiation in mind. IDC claimed organisations are creating leverage via strategies including ‘price benchmarking’, ‘claw-back’ and ‘blue-sky’ clauses.

“This finding is primarily driven by the need for flexibility to redefine the contract and minimise the risk. However, customers need to bear in mind that short term selective outsourcing contracts with blue-sky clauses may provide flexibility within the scope of services, but will not be very price competitive when compared to traditional outsourcing contracts,” said Aprajita Sharma, research manager Outsourcing and BPO, IDC.

She added that despite the growth of the multi-sourcing trend, outsourcing suppliers like IBM, EDS, CSC continued to sign longer term, highly bundled, multi-tower contracts in 2007.

“IBM managed a sweeping victory over its competitors when it came to ranking customer perception of being a leading outsourcing player,” she said. “IBM has reinforced this with some high profile strategic deals signed with National Australia Bank, Commonwealth Bank and others within the Government segment.”

The report also highlighted trends across various verticals that are acting as catalysts in boosting outsourcing spend in the local market.
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