IT Outsourcing Pricing Models


Dollar signThere are several types of outsourcing pricing models that can be adopted. Many outsourcing organizations these days use a “product” based approach whereby packaged solutions or services are bundled together to create a solution for the customer. This approach usually requires the customer to conform with “standards” laid down by the vendor. Some vendors will therefore include a “transformation” phase in the transition to the outsourcing vendor. Many customers do not want to “transform” and as a result another approach to pricing the solution is required.

An alternative to a “product” based pricing model is to ask the vendor to price their solution based on the resources required to meet the Service Level Agreements that you require. Often this is difficult because the vendor will tell the customer that they do not know how many resources are required to perform certain tasks because their resources are “leveraged”. If the vendor cannot or will not create a resource based model then you can use the Outsourcing Pricing Models on the Consulting Cloud Website to estimate what the price of the service from the vendor should be. The Outsourcing Pricing Models on the site will require you to estimate the number of resources (can be decimal points of resources) that you will need. You will also be asked what additional costs might be involved. These costs include software licensing, network costs, infrastructure etc.

By using the Consulting Cloud Outsourcing Pricing Models you can then compare the prices that your Outsourcing Vendor is proposing. This will reduce your risk, provide negotiating leverage and increase your chance of a value for money result.

The Outsourcing Pricing Models available on the site have all been used by several large IT Outsourcing Organizations.

One thought on “IT Outsourcing Pricing Models

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s