Anna Frazzetto's Blog

Digital Innovations and Technology Solutions

The Magic Number in Multisourcing

HDI's Annual Conference is an annual must-attend event for me because it's a knowledge-paloozah every time. This year was no exception, and I have the cramped hands from note taking and handshaking to prove it. To give you a sampling of the issues on the mind of IT leaders in attendance, I will quickly share three of the notable topics of discussion at the end of my conference presentation on "Multisourcing and the Message for Innovation."

- Multisourcing Is Marvelous: It was undisputed among attendees of my presentation that multisourcing is a very good way to leverage and manage IT services. The consensus in the audience was that using multiple vendors creates healthy competition for services, allows companies to balance projects among providers to avoid overload and ensures neither the client nor the vendor become complacent in their expectations and performance.

- Three Is Perfect: While multisourcing takes a wide variety of forms, attendees also felt that three offered the ideal number of vendors. Any more than three is too many to manage but two does not offer enough of a competitive incentive for other vendors to perform at the top.

- Innovation Is Obscure: When the discussion on leveraging multiple vendors for innovation advantage began, several attendees noted that innovation has become a very muddled word in the marketplace. One participant noted that people often use the word innovation when they are talking about "operational excellence." The conclusion of the group was that businesses and IT organizations need to more carefully define what they mean by innovation in order for any group (IT or business, internal or outsourced) to achieve their innovation goals.

I also was thrilled to hear one participant say that "outsourcing is no longer a taboo topic." I have been working in IT outsourcing for a few decades now so let's just say that losing the taboo has been a long time coming.