Typically, Suppliers ask for cost of living adjustments (COLAs) in IT outsourcing agreements to adjust prices periodically for inflation. We believe that the general assumption that a COLA is appropriate to “balance risk” in a three to five year IT deal should be challenged. The Supplier community is highly sophisticated…
Sourcing Speak
New Indian Privacy and Data Security Rules – Ambiguity Creates Uncertainty
On April 13, 2011, the Indian Central Government issued final regulations implementing parts of the Information Technology (Amendment) Act, 2008, dealing with protection of personal information. Pillsbury does not provide legal advice on Indian law, but we have been in contact with the Indian legal community and service providers. Here…
Why SLAs fall short – and what can be done about it? (Part 1 of 2)
A recent survey conducted by Accenture and the Shared Services & Outsourcing Network found that 2/3rds of respondents believe conversations with customers and providers about IT performance focus too much on SLAs, and not enough on business outcomes. No news here…after all, the industry has only been talking about managing…
Beware of Outsourcings that Trample Employee Rights
A recent morning paper reported that telecoms giant Orange, who are outsourcing their call center services to IBM in the Philippines, told their night-shift call center employees in Darlington that if they want to keep their jobs they would need to move to Manila. Orange reportedly offered these employees a…
Management at the Edges
Over at CIO Update, John Hughes has recently written some advice for CIOs (Somewhere Between Abdication and Control Freak) that, coincidentally, is quite relevant for those charged with managing suppliers delivering services on an outsourced basis. The premise is that an optimal solution for leadership exists somewhere between completely abdicating…
Businesses make a strong return to investment in outsourced services
Three recent reports, relating to each of the US, the UK and the EMEA region, revealed that the private sector has increased its spending on outsourced services during 2010 and the first quarter of 2011. A report by Gartner on US businesses’ IT spending indicates that 3.1% more was spent…
Don’t Let the Cloud Fog Your Thinking
Cloud-based services give new meaning to the IT holy grail of “cheaper, better, faster” in the right circumstances. You might not even have to settle for just two. But it is important not to let the Cloud fog your thinking when it comes to configuring mission-critical IT-enabled services: adequate failover…
Supplier Margins in IT Outsourcing
In our prior blog, Outsourcing Pricing and Implied Productivity we discussed the value of having a reverse engineered pricing model to evaluate supplier pricing. The idea is that by creating transparency into supplier pricing based on the factors of production (i.e., hardware, software, facilities, labor and margin) a rational pricing…
Don’t Slap the Word “Cloud” On It and Call It New
Providers are rushing head-first into the cloud revolution, marketing their latest cloud offerings and promoting the benefits of hosting data externally. To The Cloud–Start-up–Windows 7 by windows-videos But as customers analyze whether the cloud is the right fit for their technology and data, they need to carefully review whether the…
What Does Amazon Outage Mean for Cloud Adoption?
On Friday, April 22, Pillsbury hosted a meeting of the Washington, DC, chapter of the Cloud Security Alliance (CSA-DC). Dr. Ramaswamy Chandramouli, Group Chair of the NIST Cloud Computing Security Working Group addressed members of CSA-DC representing local businesses, government agencies and various consulting and law firms regarding the work…