IT services vendors face five challenges when attempting to differentiate themselves from their competitors.

In a new report, The Differentiation Challenge for North American IT Services Vendors, Celent analyzes data provided by IT services vendors as well as their North American customers. A close look at the data gathered for the Celent report IT Services Vendors Solution Spectrum: North American Version, 2010 shows that vendors face a daunting task to differentiate in this crowded industry.

Some of the data includes staff skill sets and service offerings as well as customer reasons for choosing vendors and customer satisfaction levels. Celent also proposes an approach for IT services vendors to differentiate themselves.

“The market for IT services in the insurance industry has expanded as insurers attempted to reduce costs,” says Karen Monks, Celent Analyst and author of the report. “This growing need from insurers has resulted in an expansion of companies serving the insurance IT market, from global, large consultancies and software vendors to niche players. This has implications for vendors trying to differentiate. This report points to five approaches that IT services vendors might use to become more competitive.”