What is the overarching trend in vendor management today?
Do it in-house or pay for an outside pro? That’s the question at the core of any vendor management discussion. In thinking about the answer, it’s important to consider plunging prices for hardware and the software revolutions of plug-and-play modularity, Web-based services and open source all of which serve to drive down do-it-yourself costs. Yet in the final analysis, in 2007 it often makes more sense than ever to assign IT-related tasks to external contractors. To understand why, it’s useful to start with the ideas of nonagenarian economist Ronald Coase. More than a half-century ago, Coase offered a brilliantly simple explanation as to why companies and firms ever emerge from the vast sea of sole proprietorships that form the grist of any free market economy. After all, it seems that all entrepreneurs in an efficient open market should assemble their businesses from high-skilled, low-cost specialists willing to work on a contract basis. Coase notes, however, that turning to the open
