Results of Forrester Research Omnibus Study Show Sourcing and Procurement of Services is a 2004 Priority, Particularly Among Large Enterprises.

Sunnyvale, CA – April 26, 2004 — Elance, Inc. today announced the results of a new study conducted by analyst firm Forrester Research (Omnibus Survey, April 2004, Forrester Research) which shows that improving the sourcing and procurement of services is a high priority for most companies. Although, the majority of respondents have achieved their savings targets or better from investments in goods procurement tools, 50% of all respondents now consider improving the way they source and purchase business services (such as consulting, contingent labor and business process outsourcing) as critical or important to their organizations in 2004. This priority is especially high among large enterprises (those companies with annual revenues of $1 billion or more), with 59% of these respondents saying that improving the way they source and purchase business services is critical or important.

The survey, conducted in March 2004, included 92 responses from a wide variety of senior decision makers including CIOs; CPOs (Chief Procurement Officer); IT and Procurement Vice Presidents, and other C-level executives. These executives were asked about their adoption of technology solutions for contract management, procurement and sourcing; the effectiveness of these solutions; their own organization's effectiveness in purchasing services; and the importance of improving the way their organizations source and procure business services.

The survey asked respondents to rate their organizations' effectiveness in purchasing business services - such as IT outsourcing, consulting services, contingent labor and other forms of business process outsourcing - along a number of different axes. Overall, respondents rated their companies' capabilities as only moderately effective and survey results reveal that companies are least confident in their ability to effectively evaluate the performance of service providers. The second most difficult area for companies today is in managing complex service engagements and ensuring that payments are made only against approved deliverables, service level or labor hours.

Respondents were also asked to rate their companies' effectiveness in ensuring that services purchases are made in compliance with Sarbanes-Oxley regulations and in compliance with HR and co-employment/temporary labor regulations. In both cases, a large percentage of respondents could not rate the effectiveness of their companies in these areas.

"Results from Forrester's Omnibus Survey reveal that companies are in need of tools to help them with numerous areas of services procurement, engagement management, regulatory compliance and supplier performance measurement" said Ashley Stirrup, Vice President, Marketing of Elance, Inc.. "For example, many companies feel they lack effectiveness in the complex and often subjective area of evaluating the performance of their external service providers. By improving visibility into service provider performance, companies can better channel their services spend to suppliers who are most effective and who offer the most competitive rates-which in turn translates into significant savings on one of the largest areas of corporate spending."

About the Forrester Research Omnibus Survey
The Omnibus Survey, published April 2004 by Forrester Research, surveyed 92 representatives from companies in a wide variety of industries. The majority of survey respondents represented companies with annual revenues in excess of one billion dollars. As part of the survey, Forrester asked questions posed by Elance, Inc. about responding companies' contract management, procurement and sourcing strategies, effectiveness and adoption of technology solutions.

About Elance, Inc.
Elance is the leading provider of software solutions for Services Procurement and Management (SPM) that improve the way organizations buy and manage services - one of the largest components of corporate spending. With the Elance SPM 4™ application suite, large organizations can gain visibility into services spend and performance, establish and control enterprise processes, and achieve 10-20% hard cost savings across a broad range of external service categories. Elance also provides the Elance Online™ services marketplace, the leading Web-based project marketplace that connects small- and medium-sized businesses with a global pool of high-quality service providers. For more information on Elance, please call 650-316-7500 or visit www.elance.com.

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Elance, Elance SPM 4 and Elance Online are trademarks or registered trademarks of Elance, Inc. in the United States and other countries.

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