Press Releases : 2004

New Survey Finds Growth In Compliance Reporting Lags Far Behind Surge In Outsourcing And Service Level Agreements

Research Finds Numerous Benefits of Frequent Reporting and Major Financial Consequences, Yet Most Companies Only Report Quarterly, Yearly Or Not At All

COLUMBIA, Md. July 22, 2004 - Oblicore, a leading provider of Enterprise Service Performance (ESP) applications, today announced the availability of a new industry research report entitled, "Best Practices And Trends In Service Level Management and IT Outsourcing Compliance Monitoring". The research was based on a survey of 320 IT professionals that was conducted in June, 2004 from a broad cross-section of North American industries. The research was designed to understand organizational best practices and trends with respect to compliance monitoring of Service Level Agreements (SLAs) and outsourced functions. The top four outsourced functions mentioned by survey respondents were IT services, customer service (call centers), software development and human resources (HR)-benefits-payroll.

The survey’s major findings include:

• Outsourcing has become important to a vast majority of companies (76%).
• The number of SLAs is rapidly growing, with 56% of companies reporting that they expect more SLAs in the year ahead. In terms of raw numbers, 28% had more than 50 SLAs, including 7% with more than 1,000.
• Two-thirds of the respondents said that there were significant financial consequences for non-compliance. Many of these companies are just now starting to adopt automated monitoring and reporting systems.
• The top reported benefits of managing agreements were increased customer satisfaction, efficiency and improved performance visibility. Companies saying that customer satisfaction was a benefit performed reporting mostly on a weekly basis. Companies reporting real-time or daily indicated that their top benefits were efficiency and performance visibility.
• Despite the financial ramifications of non-compliance and the benefits of frequent reporting, 43% of companies do not perform or require reporting on agreements, while 16% report quarterly or less frequently, for a total of 59% who only report quarterly, yearly or not at all.
• As a best practice, of the 57% who report, 13% monitor agreements in real-time, 11% daily, 21% weekly and 29% monthly.
• 75% of companies said it was important to improve SLA management, and almost half of the companies said that they have a defined project to do so.

An interesting finding was that SLA and outsourcing contract monitoring is becoming more complex. This finding is consistent with the broader macroeconomic trend of how services, as opposed to products, are playing a much more dominant role in business today. Half of the companies have a "service chain", which is akin to a supply chain of interrelated services. Companies reported that they not only need to manage outsourcing agreements with service providers and suppliers, but they also have related agreements with internal and external customers. In these cases, it becomes increasingly important to monitor and proactively detect performance breaches in outsourcing performance as it can directly affect a company’s ability to satisfy customers.

"The survey clearly shows that SLAs and outsourcing contracts are becoming much more prevalent, complex, and critical to monitor", said Yuval Boger, CEO of Oblicore. "Whether due to the rise of outsourcing, compliance regulations or the maturation of their IT operations, many companies are beginning to understand the enormous strategic and financial significance of monitoring and reporting on agreements on a frequent basis. The research validates the extensive benefits that companies can realize by automating SLA compliance monitoring and reporting, and by leveraging best practices."

The research report will be made available for free to people who complete a survey on Oblicore’s web site at http://www.oblicore.com/oblicoreslmreport.html.

About Oblicore

Oblicore, Inc. is a leading provider of Enterprise Service Performance (ESP) applications that manage and monitor service level agreements (SLAs), outsourcing contracts and complex business processes. Oblicore applications provide real-time visibility into service performance and reduce the cost and effort of reporting. The company is in its fifth year of operation and has gained broad market and customer acceptance. Global customers include leading telecommunications, financial services/banking, service provider, healthcare and manufacturing companies worldwide. For more information, please visit www.oblicore.com.