Gartner promotes flexible contracts

Outsourcing companies and services customers must work together to develop contracts that are flexible to adjust to the changing demands in the sourcing industry, according to a news release issued by Gartner, Inc. in April. The research and advisory firm noted that many outsourcing deals have had problems because clients feel they are not being serviced properly, and they feel tied into a rigid long-term contract. Service providers need to provide more flexible, creative contract options to the standard contracting model.

“Outsourcing contracts need to be negotiated to allow for adjustments during the life of the contract,” noted Gartner research director Christopher Ambrose. “Services clients must work with their external services providers to build sourcing contracts as living agreements that have the ability to adjust and change with the service requirements over the life of the contract.

“Alternative pricing, delivery and solution models are now emerging that would have been unimaginable a few years ago,” he continued. “Matching the right type of supplier and the right type of engagement model will become increasingly important if enterprises are to get the best business value at the right price.

“Enterprises must know their options for improving their deals, pick the one that best meets their current and future business needs, and plan a service contracting approach,” he added.