Strategic Sourcing for Vendor Management Results in Flexibility, Simplicity, and Reduced Costs

Cisco Systems has an enormous IT infrastructure budget. Lack of consistent process meant that Cisco could receive 20 different agreements for the same service with the same vendor. Agreements in different countries would have different prices, lengths, terms, and service levels. This was an inefficient and complex process for both the vendor and Cisco to manage. In addition to the complexity of these agreements, the lack of strategic planning began to cost Cisco significant amounts of money. The impetus for change began in Europe, where the vast number of service providers made choosing suppliers for WAN infrastructure particularly complex. In 2001, the Europe, Middle East and Africa (EMEA) theater of Cisco IT Infrastructure formed a Vendor Management Office (VMO).