What is "multisourcing"

n. a form of outsourcing via multiple coordinated vendors

Multisourcing is the disciplined provisioning and blending of business and IT services from the optimal set of internal and external providers in the pursuit of business goals. The nature of engaging with multiple providers with a variety of service capabilities and delivery competencies is also known as multisourcing. It is also defined as a strategy that treats a given function, such as IT, as a portfolio of activities, some of which should be outsourced and others of which should be performed by internal staff.

Multisourcing, as a term, was first introduced by the market/technology research firm Gartner in 2005. 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. Today there’s strong focus on multisourcing as a concept, it has been covered widely by research firms like Forrester Research and Gartner.

Different multisourcing arrangements are characterized by the different breadth and depth of supply relationships that constitute a supply base. The supply base is a set of contracts between a supplier and their clients that are managed by the sourcing firm for a business at a given time. The breadth of the supply base indicates the number of suppliers a firm is using. The depth of a supply chain depicts the client's level of investment in the project for a given function.