Sourcing Monthly April 2020 – May 2020
Conclusion: This month there has been a focus on the impact of the current economic environment on managed service providers. Declines in vendor service uptake, or difficulties experienced by existing customers, have resulted in the need for providers to adapt in an uncertain environment. New measures adopted by vendors when dealing with customers have included the revision of traditional business and payment models, increased flexibility with service contracts, and client support packages. Internally, vendor strategies include tightened cashflow management and regular communication with suppliers to mitigate disruptions that can have flow-on effects to their own customers. Whilst there has been a growth in demand for vendors to provide new and more complex solutions to cater to new work practices and business operations, vendors must work to maintain the integrity of their services. The re-diversion or loss of staff can impact on a vendor’s capacity to provide quality managed services, resulting in vulnerabilities. Vendors must adapt customer engagement practices in order to cater to both internal and external pressures caused by the highly variable and uncertain economic environment.