Feb 20 2008
Deloitte Study: Global Sourcing Delivering ROI, But Not Innovation
Global sourcing is delivering expected cost savings in most cases, according to a recent study done by Deloitte Consulting, covered here in an InformationWeek article. Of the 300 companies surveyed, 70% were satisfied with their sourcing relationships, with 83% reporting an average ROI of 25%. But only one in three executives that participated claimed they are gaining important benefits from innovation or transformational ideas from these relationships.
I would suggest that visualization has to be THE most critical weapon of choice as companies move their global sourcing strategies to the next level. That becomes painfully clear in the survey when IT executives complained about “underestimating the project’s scope, higher-than-expected costs, and poor-quality communications, service, and reporting from their service providers” as the main reasons they drop their services partners. If you’re contemplating moving your global sourcing partnerships from maintenance and support functions to take on new application development, then communication is critical. Visualizing the final product ahead of time with something that all global stakeholders can fully experience can only help drive closer communication, better estimates, faster turn-around and lower risk to the project.
Visualization (in the form of CAD & 3D Modeling tools) has helped traditional manufacturing organizations build better cars, airplanes, computers, etc. in a global sourcing model. Time to market has been cut in half, with better quality products built in a fraction of the cost. It’s time that software catches up!