| There are several types of technology outsourcing | | | | Pricing based model |
| models that are employed by CIOs. In a typical IT | | | | This model is based on Price, where the defining |
| organization, you could see a combination of these | | | | guidelines are the payments to vendors or the pricing |
| models in operation. | | | | of the work order. There are different types of Pricing |
| Let us see how many different types are in existence | | | | Models in existence today. These are Time and |
| today. | | | | Material, Managed Capacity and Fixed Price projects. |
| Broadly speaking, there are three different types of | | | | Project/Engagement based model or Hybrid model |
| outsourcing models in practice. These are: | | | | This model is more of a combination of the different |
| | | | flavours of the Governance and Pricing based models |
| 1. Governance Based Model | | | | described above. If you look at an IT organization from |
| 2. Pricing Based Model | | | | a holistic perspective, i.e the IT team as a whole, you |
| 3. Project Based Model These outsourcing models are | | | | can see all of the aforesaid models in operation |
| described in detail below: | | | | across projects and support engagements. |
| Governance based model | | | | Choice of models is dependent on project parameters |
| As the name itself suggests, this model is based on | | | | such as your outsourcing strategy, price, location, |
| the strategy adopted to govern the project or the | | | | delivery, scale, skills, the work itself, confidence to |
| project organization or the project team. This model | | | | outsource, feasibility to outsource and vendor profiles |
| has three different flavours to it - Professional | | | | among others. A discussion on approaches to select |
| Services or Staff Augmentation, Co-Managed and | | | | the most appropriate model is outside the scope of |
| Managed Services or Fully Outsourced. | | | | this article. |