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Contracts in Multi-Provider Environments – Part 2

  • tags-double SIAM

The “Key Stages” of a SIAM Implementation

How can a client ensure effective governance of multiple suppliers delivering its information and communication technology? The proven approach of choice is SIAM – Service Integration and Management. It represents a practical school of thought for efficiently managing the challenges that arise from having multiple suppliers. SIAM provides a structured set of measures for steering and controlling the services delivered by suppliers—”providers”—as an integrated whole.

In the first part of this blog series—Outsourcing, multi-provider, SIAM – how do you put it on paper?—I introduced the “key stages” of a SIAM implementation. To recap:

  • Discovery & Strategy;
  • Plan & Build;
  • Implement;
  • Run & Improve.

In this second part, I will take a closer look at the contractual perspective of the service integrator. Within the SIAM ecosystem, the service integrator acts, in many respects, as the central intermediary between the client and the suppliers. The service integrator coordinates and governs the various suppliers on behalf of the client and is regarded as a key element in preventing issues and optimizing the integrated IT organization.

Key Stage “Discovery & Strategy”

In the “Discovery & Strategy” key stage, the SIAM strategy, the structure of the SIAM model, and an overarching SIAM governance framework should be defined. A crucial part of these definitions is the intended design of the service integrator, particularly which entity will assume the role of the service integrator. The following ideal types can be distinguished:

  • Internal service integrator (a staff or central function within the client organization)
  • External service integrator (an independent service integrator appointed as a dedicated third party)
  • Service integrator located with the primary supplier or general contractor (lead provider)

Hybrid service integrator (a combination of the above models)Hybrider Service Integrator (Mischform der bereits genannten Möglichkeiten)

Key Stage “Plan and Build”.

In the “Plan & Build” key stage, the outsourcing contract is drafted, released by the client for negotiations with the suppliers, and ultimately concluded between all parties involved. The role of the service integrator as a central feature of the SIAM contractual model must therefore already be clearly defined at this stage.
The rights exercised by the service integrator on behalf of the client in governing and overseeing the interaction of all providers are reflected in nearly all contractual components and must be defined as corresponding obligations binding on each individual service provider.

If a hybrid or lead-provider service integrator model is selected, its clear substantive definition usually requires a separate contractual element within the outsourcing agreement. For an external service integrator, a specific contract should be concluded that is aligned with, and references, the outsourcing agreement.

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