In 2010 the bottom line for sourcing groups is where and how you deliver value to your business. Successful teams are those that truly recognize what it is that line of business stakeholders need from their IT providers — either cheap cost effective service delivery; better operational performance or unique and competitive solutions that change the game. Based on my dealings with clients and analyzing Forrester inquiry data, I’ve detected three distinct sourcing archetypes at work, each guided by different motivations, metrics and engagement types. So…which one are you?Fire-fighter? Sourcing groups that focus on fire-fighting push for discounts and focus on economies of scale through aggressive supplier consolidation wherever possible — this is something that previous entries have explored on this blog and reinforce how much the recession has pushed cost cutting to the fore most often with the blunt instrument of renegotiation (IT Sourcing Getting Less Strategic?). Sourcing groups have moved to funding on request with the centralized vendor management organizations and procurement directing operations and taking control.
Explorer? Sourcing groups in this mode direct their energy into investigating a host of emerging options for IT service delivery — this is where I see more activity from our sourcing clients as they investigate how to use some of these new pricing models, SaaS offerings, BPO, managed outcomes etc. to radically shift the cost profile of service delivery —this push is coming from around the business as CFOs read about these new models to lower costs; CEOs and board executives are seeking to hand off duplicate processes or what that they perceive as commodities to specialists through platform BPO offerings; and CIOs look to rationalize IT budgets and get better expertise.
Builder? Sourcing teams in this mode are engaged in sinking the foundations that underpin a profound shift in operating model architecture, IT/business redesign, and supplier engagement. A lot my work at Forrester focuses on helping firms understand how systematic multisourcing models supports this shift. Systematic multisourcing ensure contracts, IT service delivery, SLAs, and innovation references a common framework that sets a benchmark for inter-provider governance and execution and delivers sourcing outcomes really coupled to stakeholder demand. Think about your sourcing model as digital rather than analogue — that is what systematic multisourcing promises. Should you be looking to build?
In 2010, which sourcing archetype will you be? Tell us if we are missing any?