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Customer Outsourcing Directions: IT Prefers Integrated Outsourcing, BPO Prefers Multisourcing - But What About the Future?

Product Type: Market Research Report
Published by: IDC
Published: December 2006
Product Code: R104-29017
Description

This IDC study uses demand-side research from three IDC surveys to provide outsourcers or players looking to compete in outsourcing with an overview of market feedback on customer buying patterns for outsourced services in the IT and business process markets. In particular, this study will highlight market trends in customer preferences for integrated versus multisourcing; outsourcer preferences; key provider criteria needed to win customers; and preferred pricing methodologies and savings expectations. Within the IT outsourcing market, this study provides details on outsourcing patterns for specific IT markets (e.g., network, desktop, application, data centers, help desk, business continuity). Finally, this study provides players in the outsourcing market with critical information on the optimal business model and go-to-market strategy needed to ensure success. Areas discussed include key customer needs, portfolio of offerings, partnership requirements, sourcing investments, and transformational enablers.

"Today's customers are leveraging a variety of sourcing options that include integrated and multisourcing across both IT and business process, as well as traditional and emerging models (e.g., hosting, software as a service [SaaS]), all while leveraging new technologies with the goal of driving optimal business performance," said David Tapper, director of Outsourcing, Utility, and Offshore Services research at IDC. "For outsourcers, the combination of increased customer sophistication in sourcing capabilities and increased integration of new technologies and service models will require that players build a robust set of capabilities, develop new partnership ecosystems, invest in new service models, support multiple processes and IT requirements, and ensure that they can provide customers with flexible sourcing options."

Table of Contents

Table of Contents

IDC Opinion

In This Study

IT Outsourcing Demand-Side Survey

Methodology

Respondents

Interviews

Survey Schedule

Data Weighting

Data Analysis

Respondent Profile

Company Size

Industry

Figure: ITO Respondents by Revenue

Figure: ITO Respondents by Company Size

Figure: ITO Respondents by Industry

Business Process Outsourcing Demand-Side Survey

Methodology

Respondents

Interviews

Survey Schedule

Data Weighting

Data Analysis

Respondent Profile

Company Size

Industry

Figure: BPO Respondents by Revenue

Figure: BPO Respondents by Company Size

Figure: BPO Respondents by Industry

Offshore IT and Business Process Services Survey

Executive Summary

Pillar 1: Supporting Strategic Customer Needs

Pillar 2: Outsourcer Strategy

End-to-End Capabilities

Partnership Requirements

Sourcing Strategy

Investments

Customer/Provider Transformation

Situation Overview

Business and IT Priorities

Table: Top 5 Business and IT Priorities

Figure: Top 3 IT Priorities

Figure: Top Business Imperatives

Influencers on BPO and ITO

Figure: Top Drivers of IT Outsourcing

Figure: Top Business Challenges Enabled by BPO

Top Outsourcer Characteristics

Figure: Top Criteria When Choosing an IT Outsourcing Provider

Figure: Top Criteria When Choosing a BPO Provider

Sourcing Preferences

Figure: IT Outsourcing Model Preference by Company Size

Figure: Single-Function Priorities for IT Outsourcing by Company Size

Figure: Top 3 Reasons for Utilizing Multiple Providers for IT Outsourcing by Company Size

Figure: ITO and BPO Bundling Preference by Company Size

IT Outsourcing

Table: Top 2 Reasons for Using Multiple Providers in IT Outsourcing by Company Size

BPO

Figure: BPO Sourcing Preference

Global Sourcing

Figure: Offshore IT and Business Process Preference

Savings and Pricing Expectations

BPO

ITO

Figure: IT Outsourcing Cost Savings Reinvestment Model

Figure: Use of Utility Pricing for Outsourcing

Customer IT Outsourcing Priorities and Requirements

IT Outsourcing Concerns

Table: Top 3 Concerns When Outsourcing IT and/or Applications by Company Size

Figure: Top Concerns When Outsourcing IT Functions and/or Applications by Company Size

Governance Structures and Alignment with IT Outsourcing

Figure: Governance Structure Alignment: IT Outsourcing Model Preference

IT Outsourcing Segment Usage

Figure: Current Use of IT Outsourcing Segments

Figure: Use of Hosted Applications

IT Outsourcing Industry Perspective

Table: Top 3 Concerns About IT Outsourcing by Industry

Figure: Top Concerns When Outsourcing IT Functions and/or Applications by Industry

Segment Outsourcing Adoption Patterns by Industry

Table: Financial Services: Outsourcing Adoption by Segment (% of Respondents)

Table: Manufacturing Services: Outsourcing Adoption by Segment (% of Respondents)

Table: Healthcare Services: Outsourcing Adoption by Segment (% of Respondents)

Table: Retail/Wholesale Services: Outsourcing Adoption by Segment (% of Respondents)

Table: Communications/Utilities Services: Outsourcing Adoption by Segment (% of Respondents)

IT Outsourcing Provider Preferences

Figure: Provider Preferences for IT Outsourcing Segments

Figure: Provider Preferences for Hosted Applications

Figure: Provider Preferences for Converged Desktop Outsourcing

Future Outlook

Linking IT to Business

Figure: Linking IT to Business

Transformation and Market Optimization

Customer Transformation

Internal and Organic

External

Market Optimization

Competition and New Business Models

Sourcing Investment Strategy

Economics

Figure: Sourcing Investment Models

Optimizing Investments

Figure: Optimizing Sourcing Investments

Optimal Position

Least Optimal Position

Intelligent Sourcing

Partnership Ecosystem

Risk Management

Enabling Innovation

Target Markets: Transformation and Opportunities

Figure: Disruptive Customer Segmentation

Essential Guidance

Learn More

Related Research

Market Definitions

Service Providers

Markets

Synopsis

Ordering and More Information
Price and Delivery Options



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