Kevin Garten of TPI’s Financial Analysis Services Group will be "blogging about
the bottom line" this week.
Does asset ownership dictate who performs asset management? Not anymore. In the days of yore, asset management in an outsourcing contract was made on the basis of ownership. Today, it’s based on configuration.
Originally, asset management was in reference to logging, tagging and tracking of the physical asset itself from cradle (purchase) to grave (disposal). When it came to providing asset management in an outsourcing contract (be it an ITO or BPO sourcing arrangement) the decision was made on the basis of asset ownership.
As a result, clients pushed all ITO and BPO asset ownership onto
service providers to get out of the related overhead task. Clients
also hoped to get out of that other laborious task called capital
planning and approval. The wishful thinking especially revolved around
client dedicated equipment. But clients never divorced themselves
completely from involvement in the service provider’s equipment
provisioning process simply due to the fact that client approval is a
necessity. So much for wishful thinking.
But a lot of things have changed in the provisioning of IT and BPO
services. Nowadays, asset management deals not only with the physical
cradle to grave tracking of yore but the tracking of software loaded on
the asset, release management as well as the inter-asset interactions,
connections and transactions. Assets can now report on their own status
and perform rudimentary diagnostics, and that’s a product of the
complexity and interconnectivity of technology.
The primary change, however, came with the advent of configuration
database management. To effectively provide ITO and BPO services in
today’s environment, a service provider must supply configuration asset
management, which has profoundly impacted what a service provider must
track with regards to assets.
Without asset tracking, service providers won’t be able to supply the
quality of service expected by clients. Configuration database
management has thus become a staple in the statement of work.
Good news for clients: you can now own the assets and get out of the asset management business too.
