(Length: 13 pages)

August 22, 2006

Reality, Risks, And Best Practices For Managing Multiple Service Providers

by Paul Roehrig, Ph.D.

with Christine Ferrusi Ross, Bill Martorelli, Ronald J. Furstoss

Executive Summary (This is a document excerpt)

As more companies adopt a multiple-provider outsourcing strategy, executives are struggling to install governance processes that are cost-effective, ensure delivery quality, and provide responsible oversight of multiple complex contracts. Most practitioners agree that current outsourcing deals fail to achieve expectations primarily because of deficiencies in account governance — and multiple providers add complexity and risk for benefits that may be more perceived than real. For those committed to a sourcing strategy with multiple providers, there are some specific tactics that can improve the chances of success, such as retaining decision authority for engagement milestones and creating clear ownership of different service delivery components.