Outsourcing: Switching delivery models with Micro-Sourcing

Effective Micro-Sourcing enables hybrid delivery models and gives procurement teams maximum flexibility to ensure positive outcomes.

Enabling product owners to switch

Micro-Sourcing is a modern IT outsourcing strategy which contracts for hybrid delivery models. As a product switches between delivery models, the entirety of the product’s ecosystem (e.g., servers, databases, applications) will move to the new delivery model, making the underlying data in the Configuration Management Database (CMDB) of critical importance. As governance processes mature, the Micro-Sourcing decision framework can be augmented to take a data-driven approach to not only selecting a model and selecting the right alternatives within the model but also selecting the right supplier in the environment. That is a lot of moving parts! This selection flexibility is necessary to truly enable product owners to optimize budget and value to the business. The key governance component enabling this is a new contract schedule to capture the collaboration expectations across all parties. With the requirements and expectations now captured in the contract, all parties can coalesce on process performance and optimization across product lines, value streams, and services. That sounds great in concept, but how do you make it work; the next blog will highlight how to augment the traditional three-tiered governance model to be more integrated and proactive.

If you would like to read previous blogs in this series, visit Outsourcing (kpmg.us)

In our next Micro-Sourcing series blog, we will discuss multisupplier collaboration and integration.

Contact us

Brian C. Lewis

Brian C. Lewis

Managing Director, Procurement and Outsourcing Advisory, KPMG US

+1 303-459-7903