A mark-to-market assessment reassures a credit services client that a contract is fair.
An important part of managing a multi-year outsourcing agreement is ensuring that prices stay competitive to current market rates. Our credit services client was three years into a five-year agreement for end-user computing and service desk support when it came to us for a market price range analysis for its outsourced services.
Imagining IT Differently
ISG found that the supplier’s rates were generally within market ranges, though there were some big regional variances. While a re-bid might result in “re-weighting” of some costs across regions, overall savings were likely to be minimal. ISG also flagged non-market-standard methodology that was not well managed and a contract that was poorly constructed and silent on many standard topics.
Future Made Possible
- Confidence that existing pricing was not out of market
- Validated evolving trends in the marketplace
- Specified services the client should expect or request in the future, and the key providers for these services in the marketplace
- Understanding of typical contract clauses and important clauses for a renegotiation or re-bid
- Knowledge of typical market service-level methodology and the need to properly manage the process overall