Most end users regard their outsourcing deals as failures, but this general dissatisfaction is not enough to slow down the momentum in the booming outsourcing market.
"We?re starting to sense a level of unhappiness in outsourcing land," warned Gartner Group research director Rita Terdiman, at the Dataquest Service Trends conference in San Francisco this week. "It won?t lead to a shift away from the trend to outsource - end users need outsourcing too much for that - but the users may fight back with the threat of contract renegotiation."
Terdiman predicted that more than half of the outsourcing deals signed to date will not be considered successful by senior management because they have not delivered the expected increases in IT effectiveness or business value. She cited a survey of 1,400 chief information officers across the globe, conducted by management consultancy Deloitte and Touche, which confirmed the level of dissatisfaction. "The actual benefits of outsourcing fell short of CIO expectations in every region of the world surveyed," she said.
The area where CIOs had expected to see the biggest improvement was in vendor sophistication and expertise, which was named by 60 per cent of those surveyed. But only 35 per cent claimed to have actually achieved this benefit. Similarly, outsourcing had fallen short of expectations in the areas of quality of delivery and cost reduction.
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