This IDC study informs outsourcing buyers of the importance of a well-defined methodology for managing the outsourcing life cycle. Outsourcing of IT and business processes is much more complicated than procuring a product or a well-defined service. A rigorous outsourcing life cycle will identify the key processes, tasks, and deliverables that will help minimize the risk of the outsourcing deal delivering suboptimal results. The new ISO standard 37500 provides guidance on the outsourcing life cycle. IDC expects this global standard to be adopted in Europe and India in the near future.
Buyers that have not yet adopted a life cycle should consider ISO 37500; those that have used an in-house life cycle or a vendor-defined life cycle should review ISO 37500 to understand where potential gaps may exist. IDC expects that regulated industries such as financial services may find this standard to be a useful industrywide model for audit and education. Outsourcing providers and advisors with proprietary life-cycle models should consider the potential impact ISO 37500 will have on their business. In anticipation of client RFPs with a requirement for ISO 37500, providers should identify how their methods comply with the new standard.
"The management practice of outsourcing IT and business processes has become a widely accepted approach to reducing costs and increasing speed and flexibility. The new ISO standard 37500 provides a universal outsourcing life cycle that can be used by any organization," says Ron Babin, adjunct analyst with IDC's Research Network. "IDC predicts that, starting in Europe and India, buyers will adopt ISO 37500 as a standard framework that guides the outsourcing process. Organizations with proprietary outsourcing frameworks will adopt and integrate ISO 37500 into their framework. Over time, we expect ISO 37500 to become the de facto standard for global outsourcing."