Introduction

As companies purchasing outsourcing services increasingly adopt Information Technology Outsourcing (ITO) and Business Process Outsourcing (BPO), they become more mature in their understanding of outsourcing and focus on optimizing their sourcing efforts.  In addition to ensuring that their existing suppliers perform successfully, two other optimization levers are becoming important:

• Adopting an “enterprise” governance model
• Developing a supplier portfolio strategy

Companies choosing to utilize outsourcing on a broad basis have an increased need to implement enterprise governance and supplier portfolio strategies.  As the extent of outsourcing scope increases, the complexity of managing the outsourcing efforts and their impact upon each other also increases.

Benefits of limiting the complexity across outsourcing efforts include:

• Higher-performing and more sustainable outsourcing solutions
• Reduced confusion and wasted time
• Better mitigation of risk

To achieve these benefits, it is essential to carefully govern the overall outsourcing landscape and strategically shape the portfolio of suppliers.  Neither is a quick fix, but they are the path to sustainable success.

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