Multisourcing is the opposite of "one neck to wring."
Large-scale buyers, such as the U.S. Federal government, want to feel assured that there is more than one supplier for an item. The opposite is called sole-source. Intel, a large corporation, was not "enough" for the x86, and so others such as Advanced Micro Devices and Cyrix were needed.
There are two primary models for Multisourcing: Prime contractor and Client model.
Prime Contractor model
The client is the system integrator. Multiple outside sources, each with their own "perceived core ompetencies" provide services. This does not preclude the outside suppliers from further subcontracting.
Although "no-bid contracts are illegal under European Union commissioning law," "there are exclusions and exceptions" in the UK's rules, and "U.S. law permits .. sole source contracts under specified circumstances.
The assurance that the identical item is available seems to defy a statement that "There is no optimization achieved through working with a single provider," especially when "sustainable" capabilities exist.
Cost plus and other arrangements
Both the much-disputed Iraq reconstruction no-bid contracts and those awarded after Hurricane Katrina contained "cost-plus" provisions "that guarantee contractors a certain profit regardless of how much they ultimately spend," according to the Wall Street Journal. Critics claim that such agreements "remove any incentives for private companies to control expenses, which are paid for by the tax-payer."
A no-bid contract is a military or government contract that is made directly with a corporation, bypassing the standard process of bidding. These contracts can be made much more quickly than a typical contract, however they are often fraught with suspicion. After the 2003 war in Iraq, the Halliburton company, previously headed by then vice-president Dick Cheney, was issued a $2 billion no-bid contract for fuel distribution. Speed is usually the rationale for such contracts
Just days after Hurricane Katrina, in September, 2005, the Bush administration awarded no-bid reconstruction contracts to companies such as Fluor Corp., Bechtel, Shaw Group, CH2M Hill Cos, and Halliburton's Kellogg, Brown and Root.
Although it was recently defined, multisourcing has been practiced in the market since competitors started to produce alternatives to IBM’s datacenter products in the late 80’s. Firms like Gartner and Forrester Research. pushed the term into the public eye.
In workshops, providers are taken through business scenarios to confirm details like method, data content and timescales for each cross-provider interaction. The outputs of these workshops are operational level agreements (OLAs) which are signed and agreed upon by all providers to maximize performances and ensure that everyone is aware of the requirements of their job.
- Campaign finance
- Defense Contract Management Agency
- Federal Acquisition Regulation
- Government procurement in the United States
- Christopher Calnan (October 6, 2016). "Software maker Real Savvy raises new funds after pivoting, hitting profitability". BizJournals.com (Austin Business Journal).
... one neck to wring ... a single source of technology
- Nick Gill (2008). "The Keys to Successful Multisourcing" (PDF). Retrieved July 4, 2019.
- "Sourcing" (PDF). CrownCommercial.gov.uk.
- Sarah Burnett (May 2012). "Why the public sector is turning to multisourcing". computerweekly.com. Retrieved October 31, 2015.
- "Sole Source" (PDF). Retrieved July 4, 2019.
- "Public tendering rules: UK decision to invoke Article 50". Retrieved July 4, 2019.
- in some cases certifiably equivalent
- Bobby Varanasi (September 2006). "Multisourcing - a comparative to outsourcing" (PDF). Retrieved July 4, 2019.
- (48 CFR Ch. 1, Part 6)
- Thought pieces: who pays
- Louis V. Gerstner, Jr. Who Says Elephants Can't Dance? Inside IBM's Historic Turnaround. Collins (November 12, 2002). pp. 76
- Linda Cohen; Allie Young (2006). Multisourcing: Moving Beyond Outsourcing to Achieve Growth and Agility. Gartner Inc. p. 236. ISBN 1591397979.
- Outsourcing Providers Need A Strategy Rethink To Address Buyers' Shift To Multisourcing, http://www.forrester.com/Research/Document/Excerpt/0,7211,42569,00.html
- Mansel Luke (September 17, 2013). "How to make multisourcing work". Information Age. Retrieved November 1, 2015.