UK leads global IT multi-sourced outsourcing

Outsourcing and BPO

by CBR Staff Writer| 21 February 2014

UK’s IT multi-sourced outsourcing adoption is four times more than that of the US organisations.

UK organisations have topped the list of the global multi-sourced IT outsourcers, with only 6% of local outsourcing contracts were exclusively single source, a new report noted.

According to the research of Global 2000 companies from Information Services Group (ISG), the UK adopted the practise of multi-sourced outsourcing at nearly four times the rate of US organisations.

About 44% of the overall outsourced operations are divided between five suppliers, compared to 36% in Australia and New Zealand, only 12% in the US, with just 6% local outsourcing contracts being only single source.

ISG North Europe partner and president John Keppel said that there has been increased deal fragmentation for quite some time now, but different markets show signs of varying appetites for this.

"More mature markets, like the US, have previously embraced multi-sourcing but realised it can be difficult to manage the numerous supplier relationships and have swung back towards a model with fewer providers," Keppel said.

"However, the UK is still clearly in the honeymoon phase and is employing more sophisticated management models, such as the Service Integration and Management (SIAM) method to maximise efficiency."

European countries including Spain, Portugal and Italy have shown interest for the multi-sourced model, with 56% of outsourced contracts being multi-sourced between two and four different service providers and a additional 7% are spilt among five or more suppliers.

About 65% of outsourced contracts are multi-sourced in the Nordic region, while Germany, Austria and Switzerland are extremely behind their European equivalents, with only 40% of all contracts being multi-sourced.

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