Companies often spend large proportions of their IT budgets on outsourced and offshored IT service providers so would it surprise you that many IT directors still struggle to find out whether or not they are receiving true value from these contracts?

When it comes to benchmarking outsourced contracts, companies are usually trying to find out one of two things: whether their existing contract is still good value for money - businesses commonly set review or ‘break’ points in supplier contracts to assess performance - or, how a potential outsourced partner actually performs against the market - compared to their claims.

IT users want to be able to cut through any supplier hype, gain objective information and understand whether they are receiving value for money - and in today’s troubled economic times, this is more important than ever.

However, IT users often find it very difficult to gather the evidence they need to find out whether their outsourced contracts are competitive - so why is this?

Benchmarking supplier performance has traditionally been a lengthy and expensive process. Either it is carried out by a consultancy firm which produces a static report detailing a company’s ‘rank’ compared to other businesses, or it has been something that the supplier has offered to do themselves.

With this in mind, IT chiefs participating in The Corporate IT Forum told us that they wanted a new way to compare and contrast their outsourced contracts against those of their corporate peers so they could be certain their contracts were competitive.

They said they wanted a different approach to benchmarking - one that was simple to carry out, cost effective, reliable and above all, independent. They also told us that they wanted more control over the results. They wanted to be able to probe the benchmark results further and ask questions about their suppliers and their performance in specific areas of service delivery.

It was for these reasons that two years ago, six Corporate IT Forum members got together to design, develop, finance and finally pilot a new peer-to-peer outsourced contract benchmarking service - a service that’s now offered to the wider corporate IT community.

Continuous Performance Improvement for Outsourced IT Services (CPI OS), as it is called, offers an entirely independent way for IT users to compare and benchmark the area or areas of their outsourced IT estate that are relevant to them. All the participants are large corporate users of IT and the benchmarking comparison takes place between organisations which have outsource contracts of a similar size, scale, scope and complexity.

CPI OS uses the same established process as the wider CPI Enterprise service which for the past seven years has been helping IT users to assess how IT as a whole is being delivered to the business.

Overall, with CPI OS, blue-chips now have a cost effective benchmarking tool which gives them the power to judge for themselves whether they get value for money from their contracts.