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Gartner will soon complete the initial phase of its Vendor Report Card project, which evaluated 13 of the largest external services providers (ESPs) in the North American market (see Note 1). This project was designed to apply rigorous analysis on two levels to determine how well these vendors are delivering services to their clients. The first level of evaluation focused on enterprise-level attributes, while the second level of evaluation looked at the vendors in terms of specific service categories.

Enterprise-Level ESP Attributes: At the enterprise level, the attributes considered include organizational focus, financial stability; strategic vision, recruiting, retention and hiring; project resourcing; and internal knowledge management. All these attributes impact how well an ESP is positioned to deliver services to its clients today, and continue to deliver services in the future. Vendor briefings related to enterprise-level attributes will be completed at the end of September 2000. Gartner will publish a Strategic Analysis Report that explores those attributes and how the attributes need to be considered for various types of service offerings.

Gartner does not believe there is a single best "systems integrator, consultant or outsourcing" ESP and does not recommend that selecting ESPs for any specific project should be based on these enterprise-level attributes. However, it is appropriate to use the enterprise-level information as differentiators when two vendors appear equal in terms of their ability to deliver and as supplemental information to the following service categories.

Service Delivery Categories: Concurrent with the enterprise-level analysis, Gartner has been conducting in-depth analysis on how well service is being delivered in the categories identified.

IT Strategy, Planning and Architecture: IT strategic plans, business-to-IT alignment strategies and IT architectural planning.

E-Strategy, Design, Development and Implementation: The creation of an e-strategy, the design and development of Web applications that support that strategy and the implementation of the intended functionality, including any necessary integration with existing systems and processes.

Full-Service Outsourcing: Data center management services, including application management.

Applications Outsourcing: The ongoing maintenance, enhancement, conversion and support of an application.

Supply Chain Management (SCM): SCM solutions, including processes and enabling technology.

Business Process Re-Engineering/Change Management: Planning and implementation of new business processes and enabling technologies that represent significant change to existing business models.

The service delivery analysis included the development of a comprehensive evaluation for each service category, vendor briefings and reference checking via a consistent set of questions for each service category with clients. Not every vendor invited to participate in the study elected to participate in every category. By year-end 2000, the evaluation criteria used at the category level, as well as the results of the analysis by service category level, will be published. Gartner recommends that enterprises use these criteria to evaluate ESPs in terms of the specific project/competency need they are trying to fulfill.

Bottom Line: How ESPs manage their organizations internally must be considered when evaluating the various candidates for services. A rigorous, standardized approach to interviewing vendors helps determine their relative capabilities, strengths and weaknesses. Past performance and, more precisely, recent past performance are significant indicators in terms of how an ESP will perform for any services needed. The results of the Vendor Report Card project will provide data on market directions and trends and on how successful services are being delivered.

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