2012 Outsourcing Trends to watch out for

With the global downturn and companies declaring mediocre annual results, IT outsourcing may take a hit. However, 2012 will see companies revamping their outsourcing policies, creating newer engagement models, and ensuring that more and more could be achieved with less. Here are a few outsourcing trends we feel CIOs need to watch out for:

• Pricing Models:- Pricing models are now being suited to accommodate joint ventures, business outcomes, revenue sharing and also engagement models that are riskier in nature as compared to previous interactions.
• Deal Sizes:- Ever since 2002, though the number of large contracts and mid-range contracts have remained fairly stable, the number of those contracts (around $100 million) have tripled, thus confirming that outsourcing deal sizes that are smaller in nature have increased over the years and will continue to do so in the coming years as well.
• Cloud Services:- Post all the initial hullabaloo about using cloud services or not, companies have begun to harness the advantages of cloud services like remote infrastructure management, hosting etc. Though these services are still being tried and tested, there seems to be a higher need for these service requirements from various customers.
• Security:- One of the most important issues discussed today during negotiations are the security liability limits between outsourcing clients and the software vendors. This may be primarily because companies are now looking for better and efficient ways of maintaining sensitive data and at the same time, protecting it as well.
• Multi-Vendor Agreements:- Outsourcing clients have started de-risking themselves from single vendor contracts and have started adopting a multi-sourcing approach to outsourcing. This involves sourcing projects based on specializations or building talent in-house based on specializations.

These trends may turn to be significant this year, as companies continue to toil for better profit margins due to continued pressure to perform well. Let’s wait and watch!

As an IT technology company, we firmly believe in the value of outsourcing. But we also know that businesses need flexibility, lower risk, and more options when outsourcing their IT work. Suyati offers traditional as well as customized, unique models of engagement that ensures every business does extend their IT profitably when they choose us as their IT outsourcing partner.