In today’s business world, companies rely on their IT infrastructure for almost everything. And as business objectives evolve, an increased importance is placed on technology solutions. As such, it’s never been more important for organizations to have an IT sourcing strategy for the discovery and procurement of IT resources and the management of vendors. But what is strategic IT sourcing and who’s responsible for handling the process?
What Is Strategic IT Sourcing?
IT sourcing refers to the process of choosing or procuring IT resources from a vendor outside of the organization. It’s necessary to work with a third-party provider when your company lacks the tools needed to perform certain operations. Traditionally, a business would simply outsource their basic IT activities through a single contract with a single partner.
While this approach was useful as a cost optimization solution, the business world has changed. Nowadays, it’s more beneficial for your company to work in collaboration with a vendor. By developing a relationship with the vendor, you can create a strategic sourcing plan that allows the vendor to respond to changing business needs.
Who’s Responsible for Sourcing?
When your infrastructure needs to be updated or new technology needs to be implemented, you turn to your chief information officer (CIO). It’s their job to thoroughly understand the ins and outs of your IT environment and help you achieve business objectives through technology solutions. They know exactly what your company needs to keep your IT running smoothly, making them the best candidate to lead the charge on IT sourcing.
However, not every company has a CIO as they can be quite expensive to employ. In this situation, an organization can turn to what’s known as a virtual CIO—or vCIO for short. A vCIO handles all of the duties of a traditional CIO but on an on-demand basis, meaning you only pay for services you use.
The Link Between IT Strategy and IT Sourcing
IT strategy and IT sourcing go hand in hand. In fact, you could say IT strategy drives the IT sourcing process. When a CIO or vCIO makes an IT strategy roadmap, it tells you what technology your business needs now and in the future. But how are you going to get the technology your business requires? Here’s where sourcing comes into play.
While the IT roadmap creates a plan for your short- and long-term IT needs, strategic sourcing fills in the details of how to execute the plan. During this process, the CIO or vCIO determines how to procure the equipment you need and what vendors would be best for the business. After the vendors are identified, all that’s left is to manage the relationship between your organization and the provider.
Why Should You Consider Sourcing?
With how competitive your industry is, it’s necessary to find opportunities that give you an advantage over your competitors. Whether you’re trying to reduce costs or speed up operations, anything that can give you a leg up can have a significant effect on your company’s success. Strategic sourcing offers a variety of benefits like:
Identifying Suppliers: Effective CIOs or vCIOs have the ability to find high-quality technology solutions from reliable providers at a cost-effective price. They can also scout out alternative suppliers to ensure there’s a backup in case the first option can’t deliver.
Supplier Relationship: Discovering the best vendors is important, but it’s just as important that your organization remain on good terms with your preferred supplier. Cultivating a positive and long-term relationship by working closely with your suppliers can ensure you continue to see great results from the vendor.
Risk Management: By building a rapport with your provider, the trust between you and the third party can grow. When you receive service from the provider, you have a good idea of what to expect. There’s a lot more risk involved in getting an IT solution from a service provider you’re not familiar with.
Make Sure You Have the Right Technology
Having the wrong technology for your operations could be holding your business back. As your advisor, we want to make sure you have everything you need to achieve success. Through our virtual CIO services, we can pair you with an expert who is committed to optimizing your business with the technology you need.
Contact us today to learn more about IT sourcing and our vCIO services.