Welcome to the first of a fortnightly column dedicated exclusively to the information technology (IT) space in Bermuda. This column will address important industry trends, new products, user and security issues and legislative changes impacting the industry in Bermuda. The author is Steve Bull, the chief operating officer of IT consulting company Independent Consulting Solutions (ICS) Bermuda Ltd.Just as the Premier is contemplating ways to reduce spending by $150 million in this next fiscal year, many CEOs across the land are looking for ways to further reduce spending within their own companies from large Fortune 500 types to the small to medium-sized businesses struggling to keep things going in this environment.We all know the benefits cited for the growth of outsourcing in the IT space and I am not going to go in to detail again here. But in this inaugural piece, I do want to raise a few interesting trends within the outsourcing movement that are further shaping the industry.In no particular order, I'll tell you what we are seeing and hearing from our clients.Going Vertical. Increasingly, outsourcing clients are looking for more vertical expertise from their providers. “The vertical integration among infrastructure, applications and operations will ensure efficiency, accountability and alignment between business strategies and enabling services” says Anirban Dutta, Director of Global Strategic Business Development at CSC. And we could not agree more. Simply put, clients are rejecting the delivery of a widget for each and every IT problem and are pushing their provider to “think outside the box” and up the chain in the delivery of a solution.This thinking is giving rise to an Increased Value Proposition Asking for Help with Answers. Shrinking company budgets, the retirement of the baby boomer generation and a move to company wide outsourcing of key strategic functions has meant that in some instances, companies have thrown out the baby with the bath water.Companies have lost in-house strategic counsel given modern operating trends and are thus looking at the IT consultant to have a greater understanding of its business and leadership in the development and deployment of solutions relevant to the client's business.They are looking for help from the consultant in targeting internal inefficiencies that contribute to high costs and how those deficiencies can be addressed via system and process improvements. Providers are being given greater leeway to find savings and improvement opportunities within the client operation and have assumed in many cases, a business analyst role in addressing the IT requirements of its clients.The pricing model has been made to adjust with a shift to Outcome Based Pricing. Instead of the traditional tactic of standard consulting contracts centred around billable hours, clients are relying on more sophisticated techniques such as outcome-based pricing. This pay-for-results type pricing model is consistent with corporate changes in accountability and ensures again that value is had for each dollar spent.Development of best of breed strategies. Increasingly, firms are awarding outsourcing contracts to service providers in a best of breed approach. This is particularly true in the applications, desktop and network services areas. What this means is that consultants are constantly being forced to demonstrate above average competency in specialised areas. What this means for the consultant is a clear communication strategy in identifying and communicating to the market its strengths and capabilities in an era where each client now has multiple IT “partners” depending on specialty.Putting Procurement into Play. Outsourcing partners are being asked to play a larger role in the procurement process leveraging its own relationships or partnerships for the benefits of its clients. For customer initiatives of all sizes, IT outsourcing partners are being expected to negotiate supply chain and telephony rates and provide a one-stop shop of sorts for its clients. The challenge is the relative unwillingness of the client to shoulder the cost of these additional services as provided by the Provider.Clearly, the landscape has changed. And today's forward-thinking IT professionals, whether in-house or externally sourced, and the users of such services, must consider the realities of today's leaner and more efficient business model. The continuing shift to the use of external IT expertise in this environment has definitely raised the bar for all IT industry professionals.This is positive.Steve Bull is the Chief Operating Officer of Independent Consulting Solutions (ICS). ICS is a multi-faceted Bermudabased professional services and IT consulting company. For more information, call 295-3806 or see the website at www.icsbermuda.com.