There has been a move in recent years for more aspects of IT service management to be outsourced. This makes perfect sense for those functions that are solely concerned with the management of IT systems and resources. However, where a function interacts with both the Business and with IT the situation is less clear.
The specific area of concern here is Capacity Management. The goal of an IT outsourcer is to deliver the correct quality of service (as defined in the contract) for the least cost. This approach maximises the outsourcer’s profit. This is very closely aligned to the goals of Capacity Management. However, Capacity Management also has the goal of ensuring that the IT provision meets the needs of the Business in a timely manner. In a wonderful theoretical world, Demand Management would identify the needs of the business. They would pass this to Capacity Management who would plan capacity accordingly. Service Level Management would have set the acceptable levels of service, which Capacity management would plan, and monitor against.
Back in the real world, there are very few environments within which service levels have been defined and even less in which they are adequately monitored. Businesses are also quite vague with their forecasts, so Demand Management is less of a science but more of an art.
This leaves the Capacity Management function with a pair of conflicting goals. It may choose to deploy just enough infrastructure to support the Business needs today irrespective of service quality, and introduce additional capacity on a “just in time” basis thereby reducing unnecessary expenditure. Or it may choose to over-deploy capacity to ensure that the Business always receives adequate service, but expose itself to the risk of unnecessary expenditure if it never makes use of this additional capacity.
Outsource providers would prefer the former goal, since it reduces expenditure and maximises profit margins. In-source functions would prefer the latter goal, since it guarantees service quality for the business maximising customer satisfaction.
It is for this reason that many outsourcing agreements have ended up with TWO Capacity Management functions; one in the outsourcer, and one within the ‘vendor’ management team.
If you find yourself working in either team, it helps to understand the motives of the other group to achieve a productive working relationship.