Multi-sourcing: maximising the benefits and addressing the SIAM challenge
If the first wave of outsourcing deals in the ‘80s and ‘90s was all about sole-sourcing (having a single point of responsibility, or ‘one throat to choke’ in the outsourcing vernacular), multi-sourcing is now the preferred contracting model for many customers. The perceived benefits of multi-sourcing are well known, but what has become apparent in recent years are the additional challenges posed by multi-sourcing and the importance of having a clear strategy in place to address these challenges if customers are to maximise the benefits of a multi-sourcing approach.
Chief among these challenges are service integration and management (SIAM) and incentivising supplier collaboration. In the first wave of multi-sourcing contracts, the SIAM role was, in the main, performed by the customer. Experience has shown, however, that customers are often ill equipped to perform the role, and that the time, resource and costs (as well as the skill sets required) to perform the role effectively have been significantly underestimated by outsourcing customers.
This paper outlines the key benefits of multi-sourcing, the challenges and risks and the options available to customers to manage these risks with a view to maximising the potential of a multi-sourcing strategy…
Click on the link below to read the rest of the Kemp Little briefing.
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