neoIT a consulting firm that is focused on helping firms improve operations and grow their business by capitalizing on services globalization has released a new report with the same title as this entry.

In this report they focus on making that choice of transitioning from staff Augmentation to Managed Service model, Highlighting the key benefits of the later. The report also goes on to highlight a model that companies can look at using to make this transition.

First on the benefits of Managed Service model, the report has a simple chart highlighting the cost relative to the scope of services in the modes of staff augmentation, Managed Services & Comprehensive outsourcing.

Some of the other stated advantages of Managed Services model in the report are:

- The vendor/supplier is able to leverage Economics of scale and hence has a lower cost structure.

- Potential for Labor cost arbitrage , based on offshore model

- Reduced cost, risk & liability for client organization

- Provides flexibility and improved efficiency

- Vendor/Supplier becomes responsible for SLA

Source: 1

Prashanth Rai