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Irene Pimentel

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Irene Pimentel is an IBRS analyst who focuses on news and information on the global IT Outsourcing market. Irene provides IBRS clients with up to date information on all outsourcing deals that are taking place helping our clients understand who is winning business in what markets. With over 10 years experience as a management consultant, Irene has worked with some of Australia's largest blue chip companies and public sector organisations. Irene has also worked as a research manager for an IT sourcing consultancy, providing clients with targeted intelligence and advice for their specific IT sourcing transactions.

The importance of aligning IT outsourcing decisions with business strategies rather than cost alone is recognised. However, companies may still fall short of achieving expected benefits if the definition of current and future goals is too narrow. Adopting a value-driven approach to outsourcing requires an understanding of both business goals and how a supplier can help to meet an organisation’s strategic objectives – the IT’s value to the organisation.

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The basic concepts underlying on demand outsourcing, or purchasing IT services on a consumption-based pricing model, make it an attractive option for buyers. On demand outsourcing is a growing trend that is touted as a simple, more cost effective and strategically oriented sourcing solution. However, technical immaturity and lack of clarity regarding the precise nature of this sourcing option increases the potential complexities and risks associated with adopting it. A consumption-based pricing model is focused on activities, rather than technologies. Organisations incorporating such a model into its sourcing strategy must therefore make an assessment of potential benefits and hidden barriers to success that clearly defines the buyer’s goals and correlates these goals to services offered by vendors.

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nformation security refers to the protection of sensitive company data and vital systems from external attacks, such as theft or destruction. Part one of this series explored how organisations can determine whether outsourcing information security to a Managed Security Service Provider (“MSSP”) would be the best way to identify, prevent and recover from information security breaches.

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A monthly review of all of the sourcing activity, upcoming tenders and news items.

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Like any other sourcing transaction, relationships with Managed Security Service Providers (‘MSSPs’) that provide information security must be rationalised and planned by customers. Information security is an area of growing concern, but must be fully understood before a decision can be made regarding the approach an organisation will take to protect valuable information. Part One of this two part series explores the rationalisation of relationships with MSSPs, Part Two focuses on obtaining and managing these services.

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When developing an approach to a business process outsourcing relationship, the buyer and provider need to consider the buyer’s objectives for outsourcing the business function and what impact non-performance or sub-standard performance of the services will have on business operations as a whole. The more complex the business process being outsourced, the closer and more sustaining the business relationship between the buyer and the provider needs to be. Establishing a relationship that can be sustained requires an assessment of whether the business process should be outsourced and if so, what vendor should be selected and how to maintain the relationship throughout the course of the agreement.

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A monthly review of all of the sourcing activity, upcoming tenders and news items.

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When outsourcing, a buyer must develop a relationship structure based on what type of relationship suits its organisational structure, the activities to be outsourced and how success will be measured. For instance, using a transaction-based relationship model, a strategic model or a combination of both to measure the success of the project. Relationship difficulties might arise during the course of a sourcing transaction, shifting the focus from maximising the value of the relationship to relationship tensions. The types of problems that cause relationship difficulties include a lack of clarity regarding responsibilities between parties to the contract, unmet expectations and unexpected costs. How parties will resolve or avoid these difficulties should be considered when developing the relationship structure, internal processes and resources required by parties to the agreement. When outsourcing, a buyer must develop a relationship structure based on what type of relationship suits its organisational structure, the activities to be outsourced and how success will be measured. For instance, using a transaction-based relationship model, a strategic model or a combination of both to measure the success of the project. Relationship difficulties might arise during the course of a sourcing transaction, shifting the focus from maximising the value of the relationship to relationship tensions. The types of problems that cause relationship difficulties include a lack of clarity regarding responsibilities between parties to the contract, unmet expectations and unexpected costs. How parties will resolve or avoid these difficulties should be considered when developing the relationship structure, internal processes and resources required by parties to the agreement.

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A monthly review of all of the sourcing activity, upcoming tenders and news items.

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Part 1 of this article, published in IBRS July 2003, discussed different approaches taken by Public Sector agencies when sourcing IT. Part 2 outlines the management challenges faced by Public Sector Agencies when sourcing IT, focusing on the initial planning and assessment phases of an outsourcing initiative. The sourcing model selected (See Part 1: “Public Sector Sourcing Models” IBRS, July 2003) and internal processes established to manage this model should focus on achieving the business benefits sought and specific requirements of the agency as identified when defining the current IT status.

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