Mike Smith, General Manager, KLAS, Discusses IT Outsourcing Trends

The majority (60 percent) of healthcare organizations that have engaged a firm for discrete IT services reported seeing more value for their IT dollars since outsourcing, according to a new KLAS report — IT Outsourcing: Better Service in a Shifting Market.

Click on the player below to hear a Podcast interview with report author Mike Smith

CTGHS topped all other firms for partial ITO with a performance of 91.6. CareTech came in first for extensive ITO at 93.0 and second for partial ITO at 83.6. Findings for Accenture, Allscripts (now Eclipsys), Anthelio, ACS, Cerner, CSC, McKesson, and Phoenix Health Systems were also included in the report. CareTech, Dell, and Siemens ranked in both the partial and extensive ITO categories.

Although there has been some movement from full to partial ITO, and even to no ITO (as some providers have taken all IT services in-house) the firms’ overall performance trends in almost all cases have improved since 2008, according to KLAS.

“The partial IT outsourcing market appears to be growing steadily,” states Mike Smith, KLAS services research general manager and author of the report. “While the number of extensive ITO engagements has flattened out somewhat over the last few years. Providers that outsource their entire IT department expect high levels of strategic thinking, the sharing of best practices, and superb application management-all at a competitive price with strong service level agreements. Some ITO firms are rising to the occasion.”

“Help desk services and application management are in highest demand for those outsourcing discrete areas,” adds Smith. “Data center management comes next in popularity, with desktop management and network management lowest in demand at this point in time. Indications are strong that the partial ITO market will continue to grow; as ITO firms continue to prove their value in the healthcare space.”

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