How to better measure outsourcing

Outsourcing has ballooned into a $120 billion a year industry. While most companies say that it's critical to their business, Forrester Research recently announced survey results that show that 57 percent of IT buyers are somewhat satisfied with their primary outsourcer, 22 percent are very satisfied and more than 20 percent think their outsourcing could be better. "It's not as bad as a lot of people make it out to be. You're not inviting disaster into your firm by outsourcing," Dr. Paul Roehrig, a senior analyst with Forrester told CIO. "But there's a tremendous amount of room for improvement."

Roehrig has a number of tactics that CIOs can use to make certain their outsourcing is on track: First off, get regular checkups on the health of your outsourcing deals. He recommends going beyond just measuring performance against service-level agreements (SLAs). He says that CIOs should "assess the deal systemically beyond 'price per widget' or whether the service provider met the SLAs." He further contends that there are six areas that outsourcing customers should assess: business management capability, relationship and context, provider market status, expectation matching, transformation capability and delivery management capability.

For all the details on this holistic approach to outsourcing:
- see the article in CIO