Most companies have too many vendors. It got this way because of organizational silos and the perceived need for more than one specialized vendor to finish a project. Before launching your next project, you may want to ask yourself how many vendors you have and if their combined activities are helping or hurting because they’re siloed.
The benefits of IT vendor consolidation are important because it can often reduce complexity, redundancies, and coordination effort, resulting in more agile and efficient business performance. Furthermore, a global study of the Everest Research Institute, with a focus on a company’s external IT services, revealed that fewer suppliers bring down the total cost of ownership (TCO) between 22 and 28 percent annually.
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