A persistent mistake regarding outsourcing is that it transfers the responsibility for “providing the business with the IT services it needs against best prices and conditions” to an external supplier. True, the CIO no longer manages IT people and IT processes. That does not mean that the CIO responsibility in terms of budgets, outcomes and risk management is reduced or becomes any simpler. On the contrary, we might say the desired IT outcome and cost levels have to be achieved within the context of a commercial relationship and the contracts defining it, instead of exerting direct control on IT operations.
This changed management context provides the CIO with real opportunities for performance improvement and cost reduction, but also poses serious risks and requires a different management capability. Thus, outsourcing certainly does not reduce the CIO role but fundamentally changes it. This white paper shows why and how the CIO role changes, presents a proven best practice based organizational solution for effectively managing outsourcing - the Sourcing Governance Framework and provides guidance on building your own Sourcing Governance Function (SGF).
