Date post: | 30-Dec-2015 |
Category: |
Documents |
Upload: | cedric-tanner |
View: | 90 times |
Download: | 0 times |
© 2003 IBM Corporation
IBM Global Services
1
Offshoring TrendsOffshoring Trends
Arash Shahideh
IBM Global Services
© 2003 IBM Corporation2
Offshore becoming mainstream -- 25%+ growth India continues to dominate, but country diversification imminent New entrants, new competition New decision makers -- business buyers and consultants Big names, preferred vendors Most of the work is still project work NOT outsourcing Concerns about risk, distance and no “cookbook” Longer decision-making cycles; Increasing interest in other segments -- ITO, BPO, Network Tendency to build relationship and then leverage across services Way too much focus on rates Some backlash globally as a result of IT jobs flowing offshore
Offshore Trends in 2004-2005Offshore Trends in 2004-2005
IBM Global Services
© 2003 IBM Corporation3
“Offshore” is becoming Mainstream
Number ofEnterprises
Using OffshoreSourcing For
The First Time
1995 to 2001 2004 +2002 to 2003
Type A:Early Adopters
Type C:Laggards
Type B:Pragmatists
Largest segment ofenterprise buyers
comprise thiscategory; thus, therewill be a large volume
of activity
All types ofenterprise suchas healthcare,retail and energycompanies arepiloting oroutsourcing
Global deliverymoves to the main
stream
Early adopters ofsourcingprogramming in Indiainclude:•Financial service•High-Techmanufacturing
IBM Global Services
© 2003 IBM Corporation4
Offshore: Lower costs Round the clock Resources Quality
Mexico
Canada
Ireland
India
Russia
China
Current PrioritiesLonger-Term Prospects
Philippines
Eastern Europe/Baltic States
Nearshore Easier travel Cultural
similarities Time zone Team integration
90% of enterprises
source from here
Regions of Supply for Offshore IT ServicesRegions of Supply for Offshore IT Services
South America
IBM Global Services
© 2003 IBM Corporation5
A Simple Value Proposition….A Simple Value Proposition….
Lower costs – For example, UK based SAP consultants cost £600 and up, where SAP
consultants in India cost $22 - $35 an hour
– The savings in labor is enough to pay for the incremental overhead remote management incurs and still save 30% – 50%
Flexibility of Resources– India, China and the Phillipines supply 90% of the market
– Other low cost geographies quickly gaining in popularity (Canada, South America, Ireland)
Quality/Stability of Service– High quality infrastructure
– Highly educated staff Time zone difference
– Faster turnaround of tasks
IBM Global Services
© 2003 IBM Corporation6
Loss of communication
richness
Loss of teamness
Cultural differences
Loss of Collaboration
Coordination breakdown
Service architecture
Managerial techniques Development
methodology
Telecom infrastructureCollaborative
technologies
Constructive Responses
Disruptive Issues
Team building
… … But a very complex executionBut a very complex execution
IBM Global Services
© 2003 IBM Corporation7
Delivery teamon-site
Charged hourly, maybe milestone fees
Risk shared between client and vendor
Dedicated offshore facilities
Committed long-term revenue
Typically connected to client site by direct leased telecom link
Project manage-ment and client services in the UK; deliveryteam offshore
Quasi-captive offshore facilities
Value commitment
Processes& technology infrastructure common between client and center
Complexity of Service DeliveryLow
High
Simple Complex
Stage 1On-site
Contract Work
Stage 2On-site Project Team
Stage 3On-site/ Offshore Projects
Stage 4Offshore
Development Centers
Stage 5Transformational
Outsourcing
Pe
rsis
ten
ce
of
Se
rvic
es
Evolutionary StagesEvolutionary Stagesin Offshore Sourcing Relationshipsin Offshore Sourcing Relationships
IBM Global Services
© 2003 IBM Corporation8
High level approach to off-shoringHigh level approach to off-shoring
ScopingSupplierSelection
PortfolioAssessment &
MigrationStrategy
ApplicationSpecific
MigrationPlans
KnowledgeTransfer
ParallelPerform
ApplicationCutover
IBM’s Story
Fit with wider initiatives
Transform retained organisation (IS and business)
Change Leadership, Communications and Stakeholder Management
6 weeks 6 months 2-3 months 1-2 months 1-2 months 1 month On-going Support
IBM can either consult on the approach and/or provide off-shore services
Transition
© 2003 IBM Corporation
IBM Global Services
9
Remote Delivery Models Adopted by Our Remote Delivery Models Adopted by Our ClientsClients
IBM Global Services
© 2003 IBM Corporation10
Delivery ModelsDelivery Models
Customer facing rolesLocated at the Customer Site15 to 25% of application resourceOverall application ownership
End user interfaceSubject Matter Expert SupportPlanning & estimating requiring (<1) day turnaround timeRequirements analysisArchitecture / high level designIST / UAT supportSeverity 1 supportProduction support for online systemsOn Demand Maintenance processInstallation & data migrationApplication team lead
Practices:
Global resource rolesLocated in remote centers75 to 85% of application resourceWork as part of a 'single' application team
Process,Methods,
Tools
Planning & estimating requiring (>1) day turnaroundRequirements analysisArchitecture / high level designDetailed designProgrammingUnit TestDevelopment testingSystem testing IST/UAT support SME'sProduction support for online systemsODM processesFunction point countingMetrics collection Environment supportDBA supportInstallation & data migration
IBM Global Services
© 2003 IBM Corporation11
Application Migration Criteria Application Migration Criteria
APPLICATION CRITERIA
ASSESSMENT
TRANSITION VALUE
SIMPLE MEDIUM COMPLEX
HIGHLOW MEDIUM
AP08 AP02 AP06 AP01 AP09 AP05 AP03 AP04 AP07 AP09 APnn ....
SET 1 SET 2 ....
FIRST LAST TRANSITION SEQUENCE
Criticality
Service Level AgreementsNo. Of End UsersDisastor Recovery PlanAttrition / VacanciesRatio of Contracts/ Employees
ComplexitySkill LevelInterfacesTraining RequiredRelease & Sunset plansDocumentationFuntion Point & Lines of CodeTeam Size & Structure
Performance Pattern
Defect HistoryPerformance HistoryProduct History
PlatformDevelopment EnvironmentProgramming Language
VERY COMPLEX
IBM Global Services
© 2003 IBM Corporation12
Migration /Transition Process OverviewMigration /Transition Process Overview
Contract Engagement Transition Operation
Phase 1:TransitionPlanning
Phase 4:Parallel Perform
Phase 5:Application Cutover
= Quality Gate/Review
Phase 2:Guided Perform
Phase 3:Assisted Perform
Detailed transition planning
First phase of knowledge transfer – Customer Team to
mentor suppl. staff
Second phase of knowledge
transfer – suppl. staff to deliver 75% of support calls
Assurance checkpoint for
knowledge transfer - new
team now ready support independently
Formal milestone for completion of
knowledge transfer.
Suppl. team is ready to
take on project management
of new services
Application supported
by in steady state
Ap
pli
cati
on
ski
ll l
evel
IBM Global Services
© 2003 IBM Corporation13
Typical Application Support Structure at Typical Application Support Structure at Steady StateSteady State
Client Site Global Delivery Center
Business Help Desk (L1)
Incident/Problem Manager - assigns PT to appropriate support queue Owns the issue till it is closed
Application Support Desk (L2)
Functional consultants Owns the PT till the fix is tested and approves the code. Reassigns the PT to the L1 queue for closure with the comments
Technical Support Desk(L3)
Tech Consultants, DBAs, Queue,Interface monitoring 24x7 for sev 1 calls emergency fix, unit testing
Tools (SDMS, PELICAN)
Quality Processes
WW SAP ICM Database
IBM Global Services
© 2003 IBM Corporation14
Production Maintenance Call ManagementProduction Maintenance Call Management
Onsite TeamLevel 2 Support
Problem Reporting database
Global Delivery CenterOn-Site
Controlled Access
PT
Updates
E-mailTelephoneCell phonePagersTravelOn-line chat
Updates
PT PT
with
Resolves data related problems& working
Customerpersonnelassign severitylevels
Customer
Global Delivery Team Level 2 Support
Global Delivery Team Level 3, Emergency Fix
Business Help DeskLevel1 Support
PT
Updates
e-Meeting
Status Reports
PR
Flexible 24 x 7 support services based
on severity levels
The teams are equipped with
Pagers and cellphones
Laptops to connect from home
Central repository of all key contacts in the production support team
Roster charts
Backup contact details
Daily status update conference callsacross all the support teams
Monthly reporting on performance based on the agreed SLA’s
Based on criticality (sev 1), hourlymanagement calls on status
IBM Global Services
© 2003 IBM Corporation15
Key Performance Indicators : At Steady StateKey Performance Indicators : At Steady State
Customer SatisfactionApplication AvailabilityApplication Response TimeIncident ResolutionService Request Proposal (Non-urgent)
Project EstimationUrgent Service RequestMilestone Completion
SEI/CMM Level Attainment
Productivity (Support & Maint)Productivity (Development)
Adherence to Specifications
Resource Availability
Output / Productivity Human Resource
Customer Satisfaction
Process Adherence
SEICMM
Cost/Schedule
Quality