| INFRASTRUCTURE OUTSOURCING: A RAPIDLY | | | | direct competition or develop variations of a |
| EVOLVING SERVICE | | | | converged RIMO/Traditional IO offering with an active |
| Traditional Infrastructure Outsourcing - versus -Remote | | | | role of labor arbitrage. |
| Infrastructure Management Outsourcing – versus - | | | | Evidence of convergence can be seen as offshore |
| IAAS | | | | suppliers of remote management services are not |
| Outsourcing suppliers face the strategic dilemma in | | | | limiting themselves anymore to targeting smaller |
| Infrastructure Outsourcing (IO) services, caused by the | | | | companies with a basic labor arbitrage |
| convergence of 'traditional' (multinational)and offshore | | | | valueproposition. |
| suppliers' value propositions, a maturing remote | | | | Large buyers (above US$10 billion inrevenue) now |
| infrastructure management delivery model, and | | | | account for 55 percent of the deals signed by |
| adoption of laborarbitrage by traditional suppliers. | | | | offshore suppliers. Although the majority of offshore |
| During the last decade, the emergence andrapid | | | | deals are still based on delivering remote services |
| growth of new models of infrastructure services | | | | offshore, RIMO suppliers held 26 percent of more |
| delivery, such as Remote Infrastructure Management | | | | traditional deals in 2008 compared to only five percent |
| (RIMO) and Information Management Services are | | | | in 2004. |
| showing signs of convergence with more traditional | | | | KEY CLIENT EXPERIENCE FINDINGS |
| ways of delivering infrastructure service. | | | | KEY FINDING: MOST IMPORTANT CUSTOMER |
| Offshore RIMO suppliers still hold a minorshare of the | | | | SATISFACTION KPIs |
| IO market; nonetheless, there are increasing signs of | | | | Innovation, Trust, Reliability and Deployment are the |
| the sophistication of RIMO leading to a growing | | | | most important attributes influencing Client Companies' |
| convergence of the modelsof infrastructure delivery. | | | | satisfaction with their infrastructure outsourcing |
| The trend poses a challenge for buyers who need to | | | | providers. |
| understand the complexities of the offerings and | | | | KEY FINDING: ITO INFRASTRUCUTRE VENDOR |
| suppliers whomust refine their strategies. The | | | | SATISFACTION IS HIGHEST AMONG MIDMARKET |
| convergence of IO models is driving offshore suppliers | | | | VENDORS |
| to one of three choices: | | | | Clients with annual revenues from $500M to $1B are |
| - Continue to adopt key elements of the traditional | | | | significantly more satisfied with their Infrastructure |
| infrastructure management outsourcing model, | | | | Outsourcer than are Large Market Cap clients. |
| - Build added value to their remote offering or | | | | KEY FINDING: US VENDORS ARE SIGNIFICANTLY |
| - Simply continue to focus on classical RIMO services | | | | PREFERRED BY US CLIENTS |
| that rely on labor savings as a key driver. | | | | Latin American alternatives are challenging Indian |
| On the other hand, traditional IO suppliersare | | | | infrastructure vendors as they evolve, although two |
| confronted with a simpler, but not less challenging | | | | vendors, HCL and TCS are commanding market |
| option: | | | | growth share and commanding global user respect. |
| - Focus on end-to-end infrastructure deals that avoid | | | | |