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Switching IT outsourcing providers easier (and less costly) than ever

Stephanie Overby | Oct. 7, 2013
Heading into 2014, IT outsourcing service providers will be hard at work stealing business from their competitors -- and having theirs stolen as well.

But big providers, like IBM Global Services, also stand to lose. "It sounds counterintuitive, but size is a liability at this point," says Young. "They're at risk not because they won't be able to put new solutions in place, but because they may not do it fast enough for the market."

Smaller, more nimble providers will have the advantage. The big providers would also rather try to extend the old pricing on contracts for even an extra quarter or two to manage this shift, but those customers could jump ship. "That's the risk," Young says. "It takes a while to turn a big ship."

Customers are already taking advantage of such opportunities, and Young predicts that will accelerate as we enter next year. "The trend will be toward the easy-on, easy-off deal," says Young. "At some point as the market matures, it won't make sense to have these casual relationships and this churn. But we're at the point right now where it's advisable."

 

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