Next wave of sourcing
In the background of unprecedented financial crisis and rising need to get higher productivity with lower costs using IT, the next wave of global sourcing would be using concerted or collaborative sourcing. It is no longer a nice to hear paradigm or good-to-have, it’s the need of the hour.
Based on the needs of the company, at a point in near future, the clients would only have to decide the strategy, geography of operations and uniqueness of approach and the set of solutions would be pre-built with customization built up. This not only reduces the total spend in IT due to sharing of cost within the eco system but also brings innovation at the speed of required tremendously reducing the time to market.
The concerted sourcing would have multiple variants to it. Utility model for infrastructure management with clear security rules and economy of scale driving the costs down. Factory model of development for platforms that could be collaborated among service providers, under a cost and profit sharing basis. The model would help in customization, prioritization and process adherence in development. This is the next level of the freeware community.
It would be within the lines of Cloud computing, SaaS that are already popular with the long tail as well as the start-up companies that have a niche offering with huge time to market needs.
The important pillars required for the concerted sourcing to become mainstream is not hugely different from the global sourcing with some variation:
§ Efficient & effective governance across the service providers and the clients
§ Metrics to measure the goals of the clients, performance of the provider(s)
Most importantly, future roadmap and decision making for the products and customizations requested within the ecosystem. This is one of the flattening themes of winning in the turns.
Comments
hi Munjay,
ASP model might also prove to be beneficial in this crisis situation where instead of owning the solution, organisations can subscribe to hosted solutions, systems in ASP mode. This would be a better value proposition for organisations.
Posted by: Abhay Jogalekar | December 4, 2008 10:59 AM
Absolutely. Pay as you go will be the norm. IT investments for a change will have to prove and deliver the returns.
Posted by: Mritunjay | December 8, 2008 6:44 AM