Workleaf

The concept and importance of Multisourcing has been touted for quite some time now. Heck… there is even a book titled “Multisourcing” (which is a good read, by the way). Honestly, I did not give much thought to it, dismissing it as yet another keyword born from a world so obsessed with re-inventing its jargon list every year.

But today, I cam across an article in the Economic Times (www.economictimes.com) that made me think about the impact of multisourcing on Service Providers. You see, till now, I have only thought about the trend of Multisourcing and its impact on Outsourcing Clients (or buyers). Probably because this trend was initiated by the client side of the outsourcing spectrum. It was quite easy to visualize the challenges in outsourcing a business process (or an IT project) to multiple vendors. But what about the Service Providers? How are they impacted by this emerging trend and what challenges does it create for them?

This article (which is about Infosys and its latest technique of preventing employees from defecting to competitors) had a statement that caught my eye -

“Normally, companies ask employees to sign non-compete clause at the time of making the job offer. At least, partially this may have been triggered by the fact that increasingly now companies while outsourcing key IT functions, are splitting one project among multiple vendors rather than giving it one to derisk themselves. At times, techies could easily negotiate higher salaries doing the same project for the same client by simply moving from one company to another. Such clause will hopefully restrict it. “

Hmmm… interesting, isn’t it? Clients tend to split a project across multiple vendors to in an attempt to derisk themselves. But at the end of the day, the risk is being passed over (at least, partially) to the Service Providers. I wonder if there is any way to mitigate this risk, apart from making employees sign severe non-compete agreements, the enforcement of which, is still a grey area.

Comments?