(Dallas, Texas) October 09, 2013- A sourcing benchmark needs to
investigate the causes of any price differences to market, rather than just
show the price difference itself, according to Alsbridge Inc., a benchmarking,
sourcing and transformation advisory firm. Alsbridge today released a report How to Implement the Results of a Benchmark,
describing how considering sourcing price drivers is essential for
effectively implementing sourcing benchmark results.
According to Chip Wagner, CEO, Alsbridge,
“A sourcing benchmark needs to explore not just the price differences to
market, but more importantly the causes of these price differences.” He adds, “Without
an analysis of causes, it is nearly impossible to make any changes to the price
of your services because there could be multiple issues at stake.”
Will the provider agree to the change? What will that change do to the
pricing mechanism? How will the price change impact the service? What effects
will it have on the client/provider relationship? To be effective in these
circumstances, a sourcing benchmark needs to uncover the drivers of any price difference, such as
volume changes, asset refresh rates, residual transformation charges, etc.
These price drivers will determine the ability of either party to derive price
benefits from the agreement.
Another driver of price change is the contract itself.
“The best way to implement sourcing benchmark results is to consider the
price drivers not just the price, so all available change levers can be used to
arrive at the right market competitive price for the services required” says
Wagner.
Thus, the report reiterates that while sourcing benchmark can seem like
an easy answer to improving the price performance of your outsourced operations,
by simply changing your pricing to reflect the market, it is the price drivers
that play the key role in effectively implementing the price benchmarking
results.
To know more about effectively implementing the results of a benchmark,
access the complete report here.
About
Alsbridge Inc.
Alsbridge is a global consulting firm that provides data-driven sourcing
advisory and benchmarking services for IT, Finance and Sourcing
executives. We’ve helped
hundreds of companies reduce costs and get more value from their vendors. Our experienced consultants leverage
proprietary tools and information databases to identify and engage the optimal
vendors for your situation, negotiate best practice terms at fair market
prices, and improve the way you work with your vendors. Alsbridge clients utilize the most cost
effective and value added sources globally for IT infrastructure services,
hardware and maintenance, network services, software and maintenance,
application support and development, business processes and cloud services.
Alsbridge was ranked the #1 outsourcing advisor in the world by the
International Association of Outsourcing Professionals (IAOP) based on the
value delivered to clients. This
commitment to delivering value to our clients has made Alsbridge a
distinguished member of the 2010 Inc. 500 fastest growing privately held
companies in America.
EDITORS/WRITERS: Journalists interested in covering the above topic or
interviewing one of our SMEs, please contact:
Scott Tims
Office: 214-378-7970 ext. 278
stims@thepointgroup.com
www.alsbridge.com
