Renegotiating Outsourcing Contracts

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	Renegotiating Outsourcing Contracts

Report W600 published on 26 Feb 2008
Applications, Governance, Programme Management, Supplier Management/Procurement

This paper covers presentations by two tif subscribers.

James Simmonds led the Commercial team which renegotiated Astrazeneca's new IT infrastructure services outsourcing contract. Astrazeneca completed the renegotiation of its contract with IBM in July last year, after over two years of preparation This renegotiation was a 2nd generation deal with a value of $1.4bn and a broad scope both in terms of services and geographies. The presentation covers how Astrazeneca addressed the challenges of successfully renegotiating a major outsourcing contract with an incumbent supplier with the focus on the approach rather than the specific terms achieved.

Kevin Mercer, from BAA, presented a case study on their approach to outsourcing under tight time constraints to Computacenter End User Services (Service Desk, Desktop, Product Management...) and the more complex, outsourcing of Applications Services & Support to LogicaCMG (Offshore) both having been completed in the last 3 months.

Summary

Effective renegotiation of outsourcing contracts will provide a great opportunity for the client and service provider to re-evaluate their relationship in order to "Get it right" for the future. The proof of success will become apparent in the long-term results. The refreshed relationship should deliver governance processes that operate effectively to continuously maintain alignment between the parties on the scope, performance and price/value of the services delivered.

Participating Organisations

Contributions from 21 Contract and Procurement Executives from 16 organisation, many of them global made up this comprehensive set of reports.

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