In many organizations, IT is becoming an increasingly significant cost driver, but it's also a crucial driver of innovation and continuity. The way an organization designs its IT sourcing strategy, whether it performs IT activities internally, outsources them, or moves them to the cloud, directly impacts total IT costs and the value IT adds to the organization.
A well-thought-out sourcing strategy begins with insight into, among other things, which IT services are business-critical, which are commodities, and where the added value lies for business operations. This analysis provides a clearer picture of where costs are actually incurred and where they truly deliver value. It often turns out that the biggest cost drivers are not licenses or hardware, but management, integration, and inefficiencies.
Organizations must make conscious choices (or a mix of choices) in their sourcing, such as internal management, outsourcing, co-sourcing, output-based, or "skin in the game," to make costs more predictable or flexible. A low price might sound appealing, but what about the productivity gains? Outsourcing can alleviate your concerns, but will it deliver the desired quality? Doing everything yourself to maintain complete control, but where do you find the resources?
An effective IT sourcing strategy isn't purely a financial instrument, but a strategic tool for balancing costs, quality, and innovation. Organizations that effectively manage this cohesion and interests achieve the right mix of costs and quality: "value per euro invested."
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