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What are the risks of choosing a vendor based solely on price for IT Operations Management?

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Choosing a vendor for IT Operations Management (ITOM) is a critical decision that affects the performance, reliability, and security of your IT infrastructure. ITOM is the process of managing, monitoring, and optimizing the IT resources and services that support your business goals and operations. However, some organizations may be tempted to select a vendor based solely on price, without considering other factors such as quality, compatibility, scalability, and support. This can expose them to significant risks that can compromise their ITOM outcomes and jeopardize their business continuity. In this article, we will discuss some of the risks of choosing a vendor based solely on price for ITOM and how to avoid them.

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1 Quality and reliability

One of the risks of choosing a vendor based solely on price for ITOM is that you may end up with low-quality products or services that do not meet your expectations or requirements. For example, the vendor may use outdated or inferior technology, have poor documentation or testing, or lack certifications or standards compliance. This can result in frequent errors, failures, or downtime that affect your ITOM performance and productivity. Moreover, low-quality products or services may not be compatible with your existing IT environment or integrations, causing conflicts or disruptions that can compromise your ITOM efficiency and security.

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Andrei Syskov
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Vendors often have the ability to offer a low price due to the larger scale of their services or infrastructure. But if both the price and scale are low, this should definitely warn you.

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2 Scalability and flexibility

Another risk of choosing a vendor based solely on price for ITOM is that you may limit your ability to scale or adapt your ITOM solutions to changing business needs or demands. For example, the vendor may not offer enough capacity, features, or options to support your ITOM growth or innovation. Alternatively, the vendor may charge exorbitant fees or impose strict contracts or terms that restrict your ITOM flexibility or agility. This can prevent you from leveraging the full potential of your ITOM solutions or responding to new opportunities or challenges in your market or industry.

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3 Support and service

A third risk of choosing a vendor based solely on price for ITOM is that you may sacrifice the level of support and service that you need or expect from your ITOM provider. For example, the vendor may have inadequate or inexperienced staff, have limited or delayed communication channels, or offer insufficient or inconsistent SLAs or guarantees. This can affect your ITOM reliability and availability, as well as your customer satisfaction and loyalty. Furthermore, low-quality support or service may expose you to additional costs or risks, such as data loss, security breaches, or compliance violations.

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Christopher Favero

Director of Information Technology | ITIL, SAFe, Strategic Thought Leadership
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The old adage of you get what you pay for applies here. There is a big difference between negotiating a favorable price and picking the low cost leader. You do not get anything for free. Most likely if the product is solid there will be gaps in support and service and that directly affects how you can scale the vendors product or service.

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4 How to avoid these risks

When selecting a vendor for ITOM, it's important to not just focus on price, but to also consider other criteria that reflects the value and suitability of the vendor for your ITOM goals and needs. These criteria include the vendor's reputation, experience, and track record in the ITOM field; the vendor's technology, capabilities, and innovation in the ITOM domain; its compatibility, interoperability, and integration with your IT environment and systems; its scalability, flexibility, and customization options for your ITOM solutions; and its support, service, and SLAs for your ITOM performance and availability. By evaluating these criteria, you can select a vendor that offers a competitive price while also delivering reliable products and services that match your expectations. This way, you can optimize your ITOM outcomes and ensure business continuity.

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Dennis Talluto

Trusted Advisor | Strategist | Innovator | Performance Improvement Specialist | Transparent Leader, Consultant & Coach | Delivering competitive, distinctive and strategic advantage in YOUR business
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NEVER make your ITOM decisions based solely on price! That is a recipe for disaster. Here is the order of importance and process for a solid decision tree: 1. Company vision 2. Company strategy 3. Company architecture 4. Infrastructure / tools integration 5. Value delivery 6. Price Any vendor or product that does not align with or map into the company business and technology strategy is an automatic exclude. In the end, the best match will be found with a vendor and toolset that aligns with company strategy and value. #LVLStrategies #BlackKiltSecurity

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Andrei Syskov
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There might be a long list of metrics and agreements between you and a vendor. A thing worth mentioning is that these entities should not be developed solely from the perspective of IT. Of course, the vendor management approach should consider your business needs.

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5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Tasha Wooten

IT Provisioning Manager | Procurement | Vendor Relationships | Network Infrastructure | IT Asset & Service Management
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Compatibility Issues: Cheaper solutions may not integrate well with your existing systems, causing compatibility issues that could disrupt operations

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What are the risks of choosing a vendor based solely on price for IT Operations Management?

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1 Quality and reliability

2 Scalability and flexibility

3 Support and service

4 How to avoid these risks

5 Here’s what else to consider

IT Operations Management

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What are the risks of choosing a vendor based solely on price for IT Operations Management?

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5

1 Quality and reliability

2 Scalability and flexibility

3 Support and service

4 How to avoid these risks

5 Here’s what else to consider

IT Operations Management

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