IT outsourcing (ITO) contracts are leaving some 38 percent of IT leaders feeling “stuck in the past” as new technologies emerge and their inflexible agreements prevent them from taking advantage, according to a new study.
Independent sourcing adviser Alsbridge surveyed 250 senior IT decision makers from Europe’s most mature ITO markets (the UK, Switzerland, Holland and the Nordics) and also found that more than a third (35 percent) claim that their existing delivery models are a barrier to new technology adoption.
“Technology can deliver huge competitive advantage to businesses, but only if ITO contracts are flexible enough to quickly integrate new ideas,” said John Sheridan, director and head of ITO and Alsbridge.
“Inevitably, with the technology world developing apace, long term contracts and inflexible agreements are leaving businesses behind.”
The research also found that more than half (54 percent) of IT leaders plan to update an existing arrangement due to changing technology needs and almost half (46 percent) believe the ability to take advantage of new technologies is one of the most important factors when choosing a provider.
However, a third (34 percent) believe that suppliers will not promote new technologies that could reduce their bottom lines, such as cloud computing.
Sheridan adds: “The desire for greater flexibility in today’s economic environment is understandable, but so is the supplier’s need for clear definition and confidence around return on investment.
“Clients and outsourcers must work together to agree a deal that works for both parties and doesn’t compromise either one’s ability to deliver.”