Research conducted by MooD International, the research-from-technology company, has found that 52 per cent of buy-side IT directors focus on reducing the cost of IT, rather than on service improvement or business growth, when budgeting their spend on service providers.

This is despite the fact that only 21 per cent of those IT directors cited cost reduction as the most beneficial aspect of outsourcing. Reducing cost isn’t the top priority, yet that’s still where the majority of the money is going.

This could be due to pressure from the top – 58 per cent of the IT managers surveyed believed that, over the past year, it’s become more difficult for suppliers to deliver within the agreed budget.

George Davies, CEO of MooD International, commented: “IT directors and managers are getting pressure from multiple directions when it comes to outsourcing. On one side they’re facing pressure from their internal clients to show clear business value, whilst driving out costs and demonstrating innovation. On the other side they have suppliers who are trying to make a fair profit in an increasingly complex role.

“Outsourcing can bring benefits that are felt at all levels of a business, from the data centre right up to the CIO, but if these benefits are not communicated properly then the improvements being made can be missed. There needs to be a common view which joins up all the parts of the supply chain and can identify gaps – and resource-wasting overlaps – ensuring there is transparency across the business and not inefficient silos.”

MooD’s research included over 160 IT managers and directors responsible for managing one or more IT or BPO project, along with overseeing the budget for the project(s).

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