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Cost can’t be the sole driver for IT outsourcing –shifting mind-set from activities to outcomes

The comparative advantage from economies of scale in data centres is nowadays being offset by automation, standardisation and new ways of working

As technology becomes standardised, there is no discernible difference between an outsourced data centre and an in-house one. The case for classical infrastructure outsourcing is further undermined by the rise of the cloud and software as a service

It is critical to have a clear view of the case for IT outsourcing and clearly articulate the goals of an outsourcing initiative. Pay meticulous attention to the business case and make sure that you have a clear view of your current cost baseline and the business requirements. Execute transformation prior to moving into an outsourcing arrangement

To achieve cost saving, consider an internal cost reduction or transformation program, combined with continuous improvements, to achieve cost savings well above any IT outsourcing initiative

In the case of an outsourcing, it is imperative to avoid a transactional mind-set in the agreement and create reciprocal incentives for the entire sourcing life-cycle

3gamma Insights: Idea in brief