Effective Strategies to Deliver Sustainable Cost Optimization in Application Services

Archived Published: 04 October 2017 ID: G00327748

Analyst(s): |

Purchase this Document

Price: $195.00 USD (PAGES: 10)

To purchase this document, you will need to register or sign in above.


The pressure to optimize application service costs is compounded by the demands of digital business initiatives. Sourcing and vendor management leaders can move to fixed-price, outcome-based contracts, leverage automation and perform an application portfolio analysis to deliver sustainable results.

Table of Contents

  • Introduction
  • Analysis
    • Move to Fixed-Price, Outcome-Based Pricing Models
      • Benefits of the Fixed-Price Model
      • Why the T&M Pricing Model Is Prevalent
      • How Agile Development Can Help
      • How Productivity Units and Measurement Tools Can Help
    • Negotiate Year-Over-Year Cost Reductions Through Efficiency and Automation for Application Management Contracts
      • Add Efficiency Improvements as KPIs
      • Adopt a Reinvestment Model to Incentivize Providers
    • Conduct an Application Portfolio Analysis to Drive Long-Term Value
  • Case Study
  • Gartner Recommended Reading
© 2017 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Reproduction and distribution of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Although Gartners research may discuss legal issues related to the information technology business, Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The opinions expressed herein are subject to change without notice.

Why Gartner

Gartner delivers the technology-related insight you need to make the right decisions, every day.

Find out more

Call +1 855-515-4486 or contact us

to become a Gartner client.