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Strategic Outsourcing Models
Many people think that the concept of outsourcing is simple: pick a specific function, source it to a third party service provider and measure the service provider’s effectiveness through a series of service level metrics. Sure, that is one form of outsourcing, and probably the one that is best known. But outsourcing can come in many forms, and it is important to understand which type of outsourcing that maximizes the risk-value balance before selecting an approach.
The outsourcing, as everyone generally defines it, is pure service-based outsourcing. This outsourcing is for highly standardized functions that are repeatable across many IT organizations, and companies can benefit from a service-provider who can bring deep competency, repeatable experience and cost efficiencies through a shared service. Examples of functions that can be outsourced include repeatable infrastructure functions like DNS management, server monitoring & patching, active directory management, and operating systems engineering. These are typically commodity functions that do not add intellectual property value to the core business.
Another form of outsourcing is what I would call hybrid outsourcing. In this form of outsourcing, there is still one or more service providers to whom a function or set of functions would be sourced, but in this case the sourcing organization would have …
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