IT outsourcing involves more than IT. It takes management skills, strategic foresight and a capable organization both at the provider and at the client
IT outsourcing often feels like lottery where you are always drawing the wrong number. While it should be a guaranteed win, more often than not you turn out to be the loser. That is why many managers who outsource IT operations feel deceived. Often they are right. Worse still, to a large extent they only have themselves to blame.
Can it be true that a fourth of all such deals fall apart? It is hard to estimate the exact number of IT outsourcing deals that fail. Even so, we know from experience that only around half of all outsourcing contracts ultimately meet expectations. Often savings are never as high as anticipated, innovation is limited and efficiency tails off. Many firms, frustrated with results, wait out the end of their contracts, giving up hope that outsourcing non-strategic IT functions will benefit their organization.
But there is a better way to make sure that firms can get what they want.