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Outsourcing

The Importance of Retaining a
Strong Management Capability
A White Paper
IT OUTSOURCING
The Importance of Retaining a Strong
Management Capability
Table of Contents
Preface
You Can’t Outsource Your IT Management Problems ............................................ 2
I. IT Outsourcing Governance: The Structural Imperative .................................... 6
II. Visibility and Transparency of IT Spend and Performance ............................... 8
III. Building Relationships, Building Outcomes ................................................... 10
IV. The Allure of Offshore IT Outsourcing ............................................................ 12
V. Navigating Legal Issues and Contractual Requirements ................................ 14
Conclusion
Manage Your IT Outsourcing as a Business ....................................................... 16
Appendix A
A Structured Hierarchy of Agreements, Contracts and Services ........................ 17
Appendix B
IT Outsourcing: A Working Case Study ............................................................... 18
1
1Gartner, Inc. “Forecast for IT Outsourcing Segments Shows Strong Growth,” March 10, 2004.
2Lutchen, Mark D., “Managing IT as a Business,” John Wiley & Sons, 2004.
2
Preface
You Can’t Outsource Your IT Management Problems
IT Outsourcing isn’t a Fad…It’s a Long Term Macroeconomic Trend

Today, IT outsourcing is an important strategy for global enterprises. Many companies worldwide are either currently outsourcing key portions of their IT infrastructure – or considering doing so in the near future. Although there is considerable debate between politics and economic policies, outsourcing, as a core business strategy is here to stay. IT outsourcing is not a fad, it is a long term macro economic trend – one with accelerating momentum. According to the Gartner Group, “The worldwide outsourcing market is expected to grow from $161.9 billion in 2003 to just over $235.6 billion in...