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IT Procurement Once More An Area For Focus

May 18, 2010

Several years ago, the hot issue for IT Procurement was whether or not it should be consolidated within the general procurement organization. The development of category management resulted in many specialist IT Procurement groups being swallowed up. While CIOs may not have been enthusiastic about losing their dedicated resources, most understood the business logic.

Today, we are seeing counter-arguments and a growing number of CIOs are appointing dedicated procurement and commercial staff within their organization. Sometimes they are fighting to reclaim the relevant category management teams; in other cases, they are looking to supplement these resources. In all cases, the driver seems to be a recognition that IT service delivery depends less on technical know-how and more and more on commercial competence. A CIOs success is increasingly measured by theeir ability to select and manage the right supply base.

Contract management, performance management and relationship management are critical issues in this new IT delivery environment. CIOs have regularly been exposed to the challenges of managign outsourced providers, so they know from experience how important it is to ensure accurate scope and goals, to respond to changing user needs and to ensure stringent performance oversight. Now, with the advent of cloud and mobile computing, there is every likelihood that the residue of technical and facility management will move to external providers – and hence the CIOs success will depend on their ability to select the right partners and manage their performance, while also retaining the ability to manage change through versatile terms and relationships.

IACCM has written about this trend several times over the last year, but a couple of months ago we decided that it was time for action. Our IT Procurment ‘community of interest’ has almost 2,500 members, so we recruited Bill Huber (former IACCM Chairman and today Director of CPO Services at TPI) to lead group discussions on some of the key issues. We started by running a survey that asked our commnunity members to rank their priorities.

As the graph shows, Cloud Computing is the number one issue, but closely followed by the challenges of relationship and perfromance management and the question of skills and training. Illustrating the point that software is very much the issue of the future, interest in ‘the cloud’ was supplemented by the broader question of software asset management.

IACCM has of course undertaken extensive work on the skills profile for IT Procurement and its assessment tools are in strong demand. Our Managed Learnig tools are also very relevant to the trainign needed by groups that increasingly need contracts, commercial and relationship knowledge in order to oversee supplier negotiations and performance.

Whether or not the trend towards organizational change continues, it is very clear that the need for skilled contract and relationship professionals in the IT and services procurement field will continue to increase. This represents a strong area of oppportunity – and one that is increasingly urgent.

IACCM members can join the IT Procurement community of interest as part of their membership selections at www.iaccm.com. Participation in the community conference calls, webcasts and surveys is free to IACCM memebrs.

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