Outsourcing has become such an integral part of successful business practice that many organisations are embarking on outsourcing programmes almost without thinking. Gartner has warned against such compulsive outsourcing and advised organisations to begin a more disciplined approach to multisourcing in order to achieve business growth and agility.

Building a successful sourcing operation requires a new approach that goes beyond the traditional view of outsourcing. “Companies really need to adopt a new approach, something Gartner calls multisourcing, if they are to continue to realise the benefits of outsourcing in the future,” said Linda Cohen, vice president and distinguished analyst. Cohen has co-written Gartner's new book Multisourcing: Moving Beyond Outsourcing to Achieve Growth and Agility with fellow Gartner sourcing expert Allie Young.

Multisourcing is an innovative discipline that takes organisations beyond “quick-fix” cost cutting to enable capability building, global expansion, increased agility and profitability, and competitive advantage. As such, multisourcing requires a new mind-set and frameworks for communicating, interacting with, and overseeing service relationships both inside and outside the organisation.

1. The myth of sourcing independence: This is the idea that sourcing decisions can be made entirely independent of business strategy. As a result, organisations create outsourcing relationships that are incompatible with the business results expected.

3. The myth of economies of scale: This myth takes the form of service recipients demanding cut-rate prices for highly customised services. “Service providers can only pass along cost savings from economies of scale if they can achieve scale through standardised offerings,” said Young.

4. The myth of self-management: Buyers believe that once they sign a contract the outsourcer and the contract itself will manage the service. Most organisations do not budget and plan adequately for the ongoing management of the relationship and the services that are provided.

5. The myth of the enemy: This is the idea that service providers are out to fleece service recipients. Many organisations view contract negotiations as a war in which there will only be one winner rather than an attempt to create a mutually profitable relationship.

6. The myth of procurement: A related myth is that the sourcing of services is primarily a procurement exercise where best price wins. In reality, many services outsourced today are vital to corporate strategy, and therefore issues of capability, culture, relationship, and other factors are often more important to long-term success than price.

8. The myth of sourcing competency: Finally, and perhaps most painfully, many organisations believe that they have the requisite expertise to manage complex sourcing environments even when they have never done it before.

Central to a successful multisourcing approach is the creation of a sourcing strategy that is tightly linked to the overall business strategy and constantly monitored by an effective enterprise-wide governance system. “Companies need new approaches to sourcing strategy, sourcing governance, sourcing management, service provider selection and service measurement,” said Cohen.

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