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Cost cutting still draining IT outsourcing budgets against CIO wishes


"More than half of IT directors believe money spent with IT outsourcing suppliers is focused on cost cutting, despite only 21% of the same group citing cost cutting as the most important role for suppliers, according to research by software firm MooD International.

The research revealed 48% of IT directors believe that despite sales growth being the most important initiative, IT outsourcing contracts remain entrenched in the past by being centred around cost cutting.

When IT outsourcing was less mature it was seen as a way of reducing costs, but businesses today want investments in IT services contracts to help them deliver improved sales.

The survey of about 160 senior IT executives showed that 78% believe the expectations of the business are not aligned with what suppliers are expected to deliver. It said this can be traced to transaction-based service level agreements (SLAs).”


NCC Weekly News Update 5 May 2015



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