IT Execs Turn to Channel Brokers

With an estimate of more than half a trillion dollars in total contract value, multiyear IT outsourcing deals have become so common that IT executives are turning to outsourcing intermediaries to build successful deals, according to a market report released by Forrester Research on Jan. 12.

In a worldwide IT and applications outsourcing market now worth over $120 billion per year, these specialized consultants—IT “dealmakers”—hold a tremendous amount of sway over customers, a well as the overall sourcing industry, the report found.

Advisory firms help customers with the strategic decision-making that precedes a transaction, making sure that the sourcing goals are tied clearly to business objectives. Advisory firms are also hired to pace the march to a signed contract and in some cases, helping to ensure a successful launch, according to the report.

Forrester, based in Cambridge, Mass., reports that outsourcing agreements grew 7 percent in 2006, and will continue to take up an increasing amount in total contract value, meaning that all the more money stands to be made by outsourcing advisory firms.

Of seven companies profiled in the report, Deloitte’s OAS (Outsourcing Advisory Service), which supports offshoring and outsourcing initiatives, was the largest with 120,000 total employees, 300 to 350 sourcing advisors and 10 percent year-over-year growth.

Read the full story on Channel Insider: IT Execs Turn to Channel Brokers

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