According to Gartner’s research published in April 2014, the worldwide ITO (Information technology Outsourcing) will consistently expand resulting in 5.9% compound annual growth rate from 2013 through 2018. Naturally, CIOs and ITPMs become the most important stakeholder in the decision to outsource their firm’s IT function. During the process of ITO, ITPMs prioritize their buying decision around efficiency, capability enhancement and transformation. The choice of vendor is one of the most critical decisions IT management needs to make. With most project initiatives slated for 4-5 years, the decision also has long term consequences. This article is part of our ‘vendor-selection series’.
14 years of experience in the IT consulting industry informs us that IT PMs should not treat vendor selection as a one-off task. IT PMs and CIOs should adopt a systematic approach to explore their options for acquiring the right technology partner. The right partner isn’t always the cheapest or best talented out there, but the best match for the organization and its priorities. We present a structured way of considering who you should be partnering with:
The first step is to use the ‘partner directories’ of the major technology providers. This should be followed by ‘referrals’ acquired through professional & personal contacts. Lastly, ‘social media search’ should be used to search and validate the social credentials of IT vendors. Following is the step-by-step guide to search the technology vendors.
1) PARTNER DIRECTORIES
Most partners publish directories of certified partners. These are usually classified by region and competence and then within that by silver, platinum, gold segregation. For e.g. if you are searching for a Microsoft technologist, the best resource to find the right skill set and expertise is Microsoft Pinpoint, the exclusive Microsoft partner directory. All MCPs (Microsoft Certified Partners) are listed in this directory. Other useful resources to find technology partners are
CIOs and IT PMs usually have a good network of peers and business executives who can help them identify potentially good technology partners. Jot down 3-5 key sources that can help in searching the vendor. Initiate the process by asking each one of them to refer a person/enterprise who has got experience in the technology consulting industry. When you get referrals, ask the referred persons to name the source who referred them to you. This will help you to thank your sources once you have picked the right tech. partner.
Remember that tech consulting firms are only as good as the consultants they currently have working for them. Look up some of the best consultants you have worked with in the past. Their current employers are probably worth engaging and their peers are probably as good.
3) SOCIAL MEDIA SEARCH
Social media used to be a way to share family photos or read up on the latest news but things have changed quite a bit in the past few years. More than 34% of CIO consulted by IDG resarch indicated that they visited a potential vendor’s site to see what they are about. More and more consulting firms are being forced to publish chronicles of their competence and success.
Social verification in terms of LinkedIn and Twitter means that you can tell a lot about a vendor before you even begin talking to them. All this material is constantly crawled by search engines and updates like the Panda Update by Google mean that a lot of the marketing fluff is washed away. It may seem obvious but a search on the right keywords on google, twitter and LinkedIn can give you a pretty good idea of the best people/companies to work with in your particular space.
- Use a systematic and repeatable approach for searching the technology vendors
- Use the partner directories of relevant technology provider to identify the certified partners only
- Get referrals from 3-5 contacts
- Use social search platforms and ‘Google search’. Apply the advanced search criteria of Google such as enclosing most important part of your search queries with “”
RATIONALE OF THE THREE-STEP GUIDE
Now, you have a repeatable and measurable process to rely on for searching the right technology vendor. To help mitigate the risk of relying too-much on one source of search, adopt the 3:3:3:1 ratio whereby you can shortlist a panel of 10 vendors, 3 each from the aforementioned sources.
You can give additional weight to any source that proved out to be more valuable than others. Search vendors using multiple channels and then select the most appropriate vendor that suits your requirements. The ratio can be tweaked a little in favor of one or two sources (for instance you can rely more on partner directory search vs. the referrals and vice versa) but the primary motivation is to search the vendors using a multi-tiered approach.
Your thoughts are welcome, let us know which search channel has proved out to be rewarding for your company.
Have you always/ever adopted a systematic search for vendors or IT partners? What has been the major challenge in searching on-shore and off-shore IT vendor?