A recent survey of 112 U.S.-based IT leaders at global enterprises suggests contract renewal discussions with global systems integrators (GSIs) may become more challenging.
Market research firm UserEvidence conducted the survey on behalf of BigPanda, an AIOps platform provider. The survey found that 94 percent of respondents experienced some level of disruption due to poor IT operations performance linked to a GSI.
Operational inefficiencies are driving costs higher
On average, respondents said it takes 34 minutes to route each issue to a GSI. They also reported that 34 percent of Level 1 issues are misrouted, while 24 percent are resolved incorrectly or require rework.
L2 and L3 engineers spend an average of 41 hours per month fixing lower-tier work. Half of respondents described the resulting costs as significant or severe.
More than three-quarters (79 percent) said their organization outsources IT operations support to two or more GSIs. Additionally, 90 percent reported unplanned expansion, overage, or true-up charges. These charges increased annual contract costs by an average of 30 percent.
AI-driven alternatives gain momentum
As a result, 92 percent of respondents said they are open to, evaluating, or piloting alternatives to their current Level 1 service model. Another 41 percent plan to actively assess alternatives within the next 12 months.
The leading reasons for change include faster triage and resolution (53 percent), improved accuracy (50 percent), agentic AI technologies (40 percent), and lower costs (36 percent).
Respondents also expect AI agents to deliver faster triage and routing (22 percent), fewer misrouted incidents and less rework (17 percent), consistent 24×7 coverage (16 percent), and lower direct labor costs (13 percent).
Rising incident volumes increase the pressure
These improvements could become increasingly important. The survey found that 74 percent of respondents expect incident volumes to increase during the next 12 months. On average, they anticipate a 27 percent rise.
Respondents reported spending an average of $5.36 million annually on outsourced IT operations support. They also manage approximately 25,000 Level 1 incidents each month. On average, these organizations employ 115 full-time Level 1 engineers.
The AI era is reshaping the sourcing debate
The debate over using external IT service providers versus internal IT operations teams has continued for decades. However, AI is changing that conversation by making it easier to automate more operational tasks.
Many internal IT teams now argue they can manage more workflows themselves while lowering costs. IT service providers will undoubtedly deploy their own AI agents. However, they must still prove they can deliver services more cost-effectively than internal teams.
Business and IT leaders will soon look for measurable returns on their AI investments. Contract renewal discussions with IT service providers may become one of the first places where organizations expect to see those gains reflected.
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