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Case Study

Analyzing service delivery and charting a sourcing strategy

Analysis of an IT service provider’s pricing, productivity and quality clarified choices for a global manufacturer.

Opportunity
Opportunity

A global manufacturer wanting to ensure that it had the best pricing, productivity and quality from its IT service provider asked ISG for an assessment that included a comparative market analysis of IT services and guidelines for future sourcing options.

Imagining IT Differently
Imagining IT Differently

ISG drew on its internal global database of operational performance metrics to define a market-based pricing model, known as a proxy bid approach, to provide a comprehensive and detailed analysis that considered mitigating language and cultural barriers when offshoring; negotiating contractual guarantees on attrition rates; fixing broken processes before offshoring; strategies to avoid the risk of substandard infrastructure; and justifying an upfront investment.

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Future Made Possible

  • The client gained a market-based pricing model without going through a costly RFP process.
  • The analysis confirmed that the provider’s price was almost 30 percent below the market-based proxy price.
  • The findings underscored the strength of the client/provider collaboration in tailoring services to the client’s needs and the open dialogue regarding underlying cost structures.