Value of smart sourcing in the face of new business challenges


(By Jayant Gundewar)

If there is one constant in life – it is change. Change is inevitable; it’s how we adapt, develop, and move forward. From the extinction of the daily commute to the way businesses operate, how we view the world, and how we work, COVID-19 has transformed our world – and in some ways, it is set to get better. Remote working is the new normal. Business resilience is at the forefront of the enterprise. Yet, as we venture forward, the coming together of people from across the organization, partners, and service providers, will determine the future. Now more than ever is the time to leverage the trusted, flexible partnerships you’ve built, turning to those partners who have prepared for such events, to help organizations restore, sustain and thrive in the post COVID era.

Business and IT leaders across the world believe that a move from what has historically been termed outsourcing, to smart sourcing is imminent. At its simplest, smart sourcing is an approach to the selection and prioritization of those service providers that go above and beyond the delivery of tactical IT solutions. It’s about nurturing long-lasting relationships with providers who can deliver business outcomes aligned to the goals of the entire organization. It not only involves running your daily business, but also taking you forward on your IT transformation journey, to deliver business agility with relevant expertise to augment the gaps in your own in-house IT team.

Security and governance will continue to remain key elements that define the ability of service providers in helping clients remain competitive in the new working environments. Over the next 3-5 years, Managed Service Providers will deliver maximum value through their security capabilities, financial stability, trust, reputation, and automation. Now more than ever is IT’s time to demonstrate value by keeping core business applications, processes, and the network not just alive and well, but dynamic, to shift under the new ways.

As the relevance of a smart sourcing increases, it is important to outline the challenges experienced by business and IT leaders in this new phase dominated by disruption. Previously, organizations sought to quickly scale to meet increased customer demand. Now, scale is focused on secure networks and remote workers, digital platforms, and collaboration tools. Speed of execution and ability to simplify and automate the organization through platform-based services remains an ongoing focus, regardless of macroeconomic forces. Growth aspirations have been completely challenged. Transformation was for the most part, focused on customer experience and new revenue streams. Now, end user transformation sits front and centre on the CIO agenda.

Considerations for transformation reimagined through smart sourcing

In line with business expectations of IT to deliver against their outcomes for end user transformation, so too are those expectations on the service provider. Smart sourcing helps IT teams pinpoint the most effective transformation projects that in turn, add the maximum amount of value to the organization.

  1. Evaluate your current service provider relationships- Evolving to a smart sourcing model requires time and dedication from both parties. First, understand your partner’s competencies and the ability to deliver against initiatives with strong end user transformation
  2. Understand your own transformation motivations- End user security is paramount right now, as is agility and scalability to increase availability and to automate various components of the IT environment. Whatever your motivation, your service provider should be able to listen and help with a broad range of capability
  3. Transformation approach and project focus- Understand your service provider’s ability to help you deliver outcomes related to both business and IT. True smart sourcing is about prioritizing service providers who can deliver to the needs of the business
  4. Keep it simple-Technology is notorious for its complexity. A smart sourcing relationship keeps these elements as simple as possible. And, not just for IT teams, but for the entire business to understand through the transformation process

Who we partner with and how we work together will be crucial to the long-term viability of organizations. Service providers are at a pivotal moment too where they must show their value, stability, and confidence in being able to deliver core business values with both an IT and line of business audience in mind. As the world of service provision moves on from simply outsourcing to smart sourcing, the ability to help IT move up the value chain is a core component. While there is a gradual trend for IT to be far closer to the line of business leaders, there is still some way to go for many.

(The author is the Senior Director – Transformation & Platform Services Sales at NTT Ltd. (India)



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