Gartner Says Services Clients Must Negotiate Flexible and Enduring Outsourcing Contracts With Their External Service Providers
Gartner Analysts and Consultants To Provide Nine City Briefing Tour on Outsourcing Challenges and Strategies
STAMFORD, Conn., April 8, 2003 — Outsourcing companies and services customers must work together to develop contracts that are flexible to adjust to the changing demands in the sourcing industry, according to Gartner, Inc. (NYSE: IT and ITB). Many outsourcing deals have had problems because clients feel they are not being serviced properly, and they feel tied into a rigid long-term contract.
"Outsourcing contracts need to be negotiated to allow for adjustments during the life of the contract," said Christopher Ambrose, research director for Gartner. "Services clients must work with their external services providers (ESPs) to build sourcing contracts as living agreements that have the ability to adjust and change with the service requirements over the life of the contract."
Most enterprises recognize that the contracting model they have today will not sustain them in the future. ESPs will need to provide more flexible, creative contract options.
"Alternative pricing, delivery and solution models are now emerging that would have been unimaginable a few years ago," Ambrose said. "Matching the right type of supplier and the right type of engagement model will become increasingly important if enterprises are to get the best business value at the right price."
Most strategic service provider deals fail because of a breakdown in the relationship between the parties. In a fast-changing world, enterprises must focus on managing the relationship and that is founded on a solid, flexible and enduring contract.
"It's na?ve to think that all deals with ESPs are perfect or that they cannot be improved by making changes in price, scope and contract terms and conditions, or by shifting risk," said Ambrose. "Enterprises must know their options for improving their deals, pick the one that best meets their current and future business needs, and plan a service contracting approach."
Gartner analysts will provide additional analysis on outsourcing during a series of local briefings titled "Getting Tactical and Flexible with Outsourcing." The briefings will be held in nine cities beginning in Philadelphia on April 22, 2003. These local briefings will explore how to evaluate an external service provider and negotiate a contract that delivers on today's changing economy. Learn how to create an evaluation process, and how to refresh yesterday's contracting approaches to better manage the risks and costs of outsourcing.
Local briefings will also be held in Detroit, MI on April 23, Chicago, IL. on April 24; Toronto, ON. on May 6; Boston, MA. on May 7; New York City on May 8; Seattle, WA. on May 20; Denver, CO. on May 21; and Atlanta, GA. on May 22. For more details or to register for the briefings, please visit Gartner's Local Briefings Web site at www.gartner.com/localbriefings.com. Members of the media can register by contacting Christine Holroyd at 416-222-7900 ext. 240 or at christine.holroyd@gartner.com.
About Gartner:
Gartner, Inc. is the leading provider of
research and analysis on the global information technology industry. Gartner serves more
than 10,000 clients, including chief information officers and other senior IT executives
in corporations and government agencies, as well as technology companies and the
investment community. The Company focuses on delivering objective, in-depth analysis
and actionable advice to enable clients to make more informed business and technology
decisions. The Company's businesses consist of Gartner Intelligence, research and
events for IT professionals; Gartner Executive Programs, membership programs and peer
networking services; and Gartner Consulting, customized engagements with a specific
emphasis on outsourcing and IT management. Founded in 1979, Gartner is headquartered in
Stamford, Connecticut, and has 3,700 associates, including more than 1,000 research
analysts and consultants, in more than 75 locations worldwide. For more information,
visit www.gartner.com.
