Enterprises have always depended on external suppliers to provide critical parts of the IT infrastructure and services, such as network connectivity between their offices. However, whenever an enterprise shares responsibility with a service partner, there are risks that the partner will not deliver service to the quality expected. When the enterprise deals with a new type of service, the risks are even higher.

Where Are the Risks?

An increasing number of IT services previously handled in-house are now available externally, such as Software-as-a-Service (SaaS) and help desk support in addition to long-standing opportunities such as network management and data center hosting. These suppliers provide a real opportunity for enterprises to reduce costs or to obtain services that were previously available only to large enterprises. In addition, an increasing number of enterprises are using specific external services, for example, off shoring, for the first time.

In many situations, the enterprise is sufficiently experienced to know the risks and pitfalls. The enterprise effectively manages the risks and the results are generally satisfactory.  In negotiating and managing the delivery of an unfamiliar service, however, the buyer must proactively address several significant risks. Otherwise, the service can become unsatisfactory and the enterprise...