# Multisourcing

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**Multisourcing** is the concept of working with multiple suppliers who are also competitors.[1] Large-scale buyers, such as the U.S. [federal government](/source/US_Federal_government), may want to feel assured that there is more than one supplier for an item.

It has been described as the opposite of "one neck to wring".[2] The opposite is called [sole-source](#Sole_sourcing).

[Intel](/source/Intel), a large corporation, was not "enough" for the [x86](/source/X86), and so others such as [Advanced Micro Devices](/source/Advanced_Micro_Devices) and [Cyrix](/source/Cyrix) were needed.

## Models

There are two primary models for multisourcing: Prime Contractor and Client models:[1]

### Prime Contractor model

A *Prime Contractor* may use *[subcontractors](/source/Subcontractor)*. Either way, the client has "one neck to wring".[2]

### Client model

The client is the *[system integrator](/source/System_integrator)*.[3] Multiple outside sources,[4] each with their own "perceived [core competencies](/source/Core_competency)",[1] provide services. This does not preclude the outside suppliers from further subcontracting.[1]

## Sole sourcing

Although "no-bid contracts are illegal under [European Union procurement law](/source/Government_procurement_in_the_European_Union)",[5] "there are exclusions and exceptions" in the UK's rules,[6] and "U.S. law permits .. sole source contracts under specified circumstances".[5] The US Government raised concerns in 2009 about "excessive reliance" on sole-source contracting and use of "contracts with a limited number of sources".[7]

The assurance that the identical and in some cases, certifiably equivalent,[*[clarification needed](https://en.wikipedia.org/wiki/Wikipedia:Please_clarify)*] item is available seems to defy a statement that "[t]here is no optimization achieved through working with a single provider",[8] especially when "sustainable" capabilities exist.[9][5][8]

### Cost plus and other arrangements

Both the much-disputed Iraq reconstruction no-bid contracts and those awarded after [Hurricane Katrina](/source/Hurricane_Katrina) contained "[cost-plus](/source/Cost-plus_contract)" provisions which "guarantee contractors a certain profit regardless of how much they ultimately spend", according to the *[Wall Street Journal](/source/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".[10]

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](/source/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.](/source/Fluor_Corp.), [Bechtel](/source/Bechtel), [Shaw Group](/source/Shaw_Group), [CH2M Hill](/source/CH2M_Hill) Cos, and Halliburton's [Kellogg, Brown and Root](/source/Kellogg%2C_Brown_and_Root).[11][12]

## History

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 1980's.[13] Firms like Gartner[14] and [Forrester Research](/source/Forrester_Research)[15] pushed the term into the public eye.

## Future

Multisourcing's strength, first recognized by [Gartner](/source/Gartner) Group in 2005, is to continue providing disciplined services via a blend from internal and external sources.[14]

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)[16] which are signed and agreed upon by all providers to maximize performances and ensure that everyone is aware of the requirements of their job.

## See also

- [Campaign finance](/source/Campaign_finance)

- [Cronyism](/source/Cronyism)

- [Defense Contract Management Agency](/source/Defense_Contract_Management_Agency)

- [Federal Acquisition Regulation](/source/Federal_Acquisition_Regulation)

- [Government procurement in the United States](/source/Government_procurement_in_the_United_States)

- [second source](/source/Second_source)

- [supply chain diversification](/source/Supply_chain_diversification)

## References

1. ^ [***a***](#cite_ref-CapG_1-0) [***b***](#cite_ref-CapG_1-1) [***c***](#cite_ref-CapG_1-2) [***d***](#cite_ref-CapG_1-3) Nick Gill (2008). ["The Keys to Successful Multisourcing"](https://www.capgemini.com/wp-content/uploads/2017/07/tl_The_Keys_to_Successful_Multisourcing.pdf) (PDF). Retrieved July 4, 2019.

1. ^ [***a***](#cite_ref-Neck1.BizJ_2-0) [***b***](#cite_ref-Neck1.BizJ_2-1) Calnan, Christopher (October 6, 2016). ["Software maker Real Savvy raises new funds after pivoting, hitting profitability"](https://www.bizjournals.com/austin/news/2016/10/06/software-maker-real-savvy-raises-new-funds-after.html). *[Austin Business Journal](/source/Austin_Business_Journal)*. ... one neck to wring ... a single source of technology

1. **[^](#cite_ref-3)** ["Sourcing"](https://assets.crowncommercial.gov.uk/wp-content/uploads/RM3804%2520Multi%2520sourcing%2520v1.pdf) (PDF). *CrownCommercial.gov.uk*.

1. **[^](#cite_ref-4)** Sarah Burnett (May 2012). ["Why the public sector is turning to multisourcing"](http://www.computerweekly.com/opinion/Why-the-public-sector-is-turning-to-multi-sourcing). *computerweekly.com*. Retrieved October 31, 2015.

1. ^ [***a***](#cite_ref-CDN.sole_5-0) [***b***](#cite_ref-CDN.sole_5-1) [***c***](#cite_ref-CDN.sole_5-2) ["Sole Source"](https://cdn.ymaws.com/www.wipp.org/resource/resmgr/gm5_podcasts_rev/Sole_Source.pdf) (PDF). Retrieved July 4, 2019.

1. **[^](#cite_ref-6)** ["Public tendering rules: UK decision to invoke Article 50"](https://europa.eu/youreurope/business/selling-in-eu/public-contracts/public-tendering-rules/index_en.htm). Retrieved July 4, 2019.

1. **[^](#cite_ref-7)** ["Memorandum for the Heads of Executive Departments and Agencies. Subject: Government Contracting"](https://obamawhitehouse.archives.gov/realitycheck/node/2076). Office of the Press Secretary. 4 March 2009. Retrieved 27 June 2023.

1. ^ [***a***](#cite_ref-OutYes.EA_8-0) [***b***](#cite_ref-OutYes.EA_8-1) Bobby Varanasi (September 2006). ["Multisourcing - a comparative to outsourcing"](http://www.ea-inc.com/documents/ea_WPaper_Multisourcing-A%20Comparative%20to%20Outsourcing.pdf) (PDF). Retrieved July 4, 2019.

1. **[^](#cite_ref-9)** [48 CFR Ch. 1, Part 6](https://www.law.cornell.edu/cfr/text/48/part-6)

1. **[^](#cite_ref-10)** [Thought pieces: who pays](http://tiger.towson.edu/~apeak1/writtenwork/thoughtpieces/radicalsforcapitalismareviewofareview.html)

1. **[^](#cite_ref-11)** ["Audit: Feds wasted millions on Katrina work"](https://www.nbcnews.com/id/wbna26647780). *[NBC News](/source/NBC_News)*. [Associated Press](/source/Associated_Press). September 10, 2008. Retrieved September 14, 2025.

1. **[^](#cite_ref-12)** Wolk, Martin (May 30, 2006). ["Contractors rake it in as they clean it up"](https://www.nbcnews.com/id/wbna12875663). *[NBC News](/source/NBC_News)*. Retrieved September 14, 2025.

1. **[^](#cite_ref-13)** Gerstner, Louis V., Jr. (2002). *Who Says Elephants Can't Dance? Inside IBM's Historic Turnaround*. New York City: Harper Business. p. 76. [ISBN](/source/ISBN_(identifier)) [978-0060523794](https://en.wikipedia.org/wiki/Special:BookSources/978-0060523794).{{[cite book](https://en.wikipedia.org/wiki/Template:Cite_book)}}: CS1 maint: multiple names: authors list ([link](https://en.wikipedia.org/wiki/Category:CS1_maint:_multiple_names:_authors_list))

1. ^ [***a***](#cite_ref-Gartner_14-0) [***b***](#cite_ref-Gartner_14-1) Linda Cohen; Allie Young (2006). [*Multisourcing: Moving Beyond Outsourcing to Achieve Growth and Agility*](https://books.google.com/books?isbn=1591397979). [Gartner](/source/Gartner) Inc. p. 236. [ISBN](/source/ISBN_(identifier)) [1591397979](https://en.wikipedia.org/wiki/Special:BookSources/1591397979).

1. **[^](#cite_ref-15)** [Outsourcing Providers Need A Strategy Rethink To Address Buyers' Shift To Multisourcing](http://www.forrester.com/Research/Document/Excerpt/0,7211,42569,00.html)

1. **[^](#cite_ref-16)** Mansel Luke (September 17, 2013). ["How to make multisourcing work"](http://www.information-age.com/it-management/outsourcing-and-supplier-management/123457348/how-to-make-multi-sourcing-work). *Information Age*. Retrieved November 1, 2015.

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Adapted from the Wikipedia article [Multisourcing](https://en.wikipedia.org/wiki/Multisourcing) by Wikipedia contributors ([contributor history](https://en.wikipedia.org/wiki/Multisourcing?action=history)). Available under [Creative Commons Attribution-ShareAlike 4.0 International](https://creativecommons.org/licenses/by-sa/4.0/). Changes may have been made.