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Chris Halward
Professional Development Director, NOA
25th March 2014
• The NOA is the leading global association serving both the outsourcing professional and the outsourcing industry.
• Our vision is to grow the size and positive reputation of the outsourcing industry.
• Our mission is to be both the home and global ambassador of world class outsourcing.
• We are passionate about excellent outsourcing and throughout our 26 years have remained committed to advancing the outsourcing profession and improving and growing the outsourcing industry by driving awareness, education, standards and thought leadership.
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Corporate members include: Avasant Capgemini Barclays BBC Boots Deloitte DWP EE Eversheds HSBC IBM Land Registry Met Police RPC Sitel Unilever Wipro
NOA (2013) LTD © all rights reserved
The
Numbers
8% of UK
GDP**
1,155 o/s
contracts >
$5 in 2013 m*
$19bn total
value*
O/s contracts
in EMEA up
18% to 587*
* ISG global Index 2013 ** Oxford Economics
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External Internal
Inputs Outputs Add
Value
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In-house
Outsource Shared Service
?
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Rewards Risk
< Costs Access to skills
Access to new tech < capital requirements
Extend into new markets Flexibility
Wrong choices Poor execution
Expectations not realised Loss of control
Change Relationship challenges
Stakeholders impact Inability to manage a new
paradigm
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Outsourcing of F&A processes
Drivers: to improve performance, reduce costs and enhance overall quality
Solution: offshoring; centralise contract mgmt.; workflow solution
Why outsource Provider contributes: ◦ Expertise / Global ◦ Capital ◦ Technology (workflow) ◦ Change impetus ◦ Culture fit
Results ◦ < costs ◦ > process efficiencies ◦ Enabled structural change
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Rewards Risk
< Costs Access to skills Access to new tech < capital requirements Extend into new markets Flexibility
Wrong choices Poor execution Expectations not realised Loss of control Change Relationship challenges Stakeholders impact Inability to manage a new
paradigm
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Facilities Contactor and a NHS Trust £2m / annum to supply catering services mainly for patients, for 7 years, extendable at the discretion of the Trust. The dispute was over a mechanism for service failures which went awry Over a period of 6 months the Trust claimed almost £600k in deductions. This included the following items deemed as failing: £94k for butter sachets; bagels £96k; mousse £84k along with a number of other items. There were a number of causes of this sorry state of affairs which not surprisingly cost both parties substantial sums and led to termination of the arrangement.
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Strategic Leadership drives
RE provides the foundation
T&C is the ‘build’ phase
RM drives / develops
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Outsourcing must be seen as strategic, and have long term leadership ◦ There should be a consensus
around the ‘Intent’ ◦ Explore the market effectively –
this will inform your RFPs ◦ Develop a Blueprint – what is the
vision, what are the challenges, how will the organisation address them consistently
◦ Recognise the impact of effective Governance early
◦ Emphasise the need for Exit planning
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INTENT
VALID CASE
BUY-IN
CONSISTENCY
“This is not the time to be ‘lovey dovey’. We know what we want, they know what they want – let the best team win!”
Experienced Procurement Director
For some this is a difficult paradigm to shift – the notion that outsourcing is by its nature a collaborative enterprise.
The parties need to consider the other’s needs / issues – a poor deal for one is probably a poor deal for the other.
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The feedback we get is that this can often be a really challenge
There is a risk of ‘throwing it over the wall’
It is at this point when a lengthy courtship becomes and marriage becomes real.
It is often the ‘storming’ stage of the relationship
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Forming
Storming
Norming
Performing
Overview
T-Mobile / Infosys
Outsourcing the Finance Directorate
Complex – 4 depts, 21 processes, 130 sub processes and 70 FTEs ‘at risk’
The new operation was to be based in India
It was a first time outsourcing experience for the Directorate
Knowledge transfer risk
The need to maintain service levels
Result:
Transition delivered under budget
100% on time recruitment
No escalations
95% on time completion of training / knowledge transfer
Business Case delivered
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Commitment from top management on both sides
Robust Governance
Partnership Approach
Selecting the Right Resources to support the Transition
Proactive Project Management
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Technology needs to be managed closely and tightly
Cultural integration is critical
Learning Transfer must be planned and resourced carefully
Clearly define the scope
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The phase where expectations are delivered and where the parties are likely to reap what they have sown
What Does Good Look Like?
A sound relationship
A service that keeps up with the
organisation
Robust Governance
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‘Lets make this work’ mindset
Clarity and discipline on requirements
Invest in the process and documentation
Prompt feedback and signoff
Communicate and leverage the time zone difference
Acknowledge and bridge the cultural differences
Build other communication channels as well e.g. Skype
When things break, ‘fix not fight’
CULTURAL FIT
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Recognise the critical nature of strategic leadership
See the Life Cycle as a system – not as a series of projects
Appreciate that outsourcing requires a sound relationship
Goals need to be aligned
Governance, Governance, Governance
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Support the NOA – Join today!
Go to www.noa.co.uk
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QUESTIONS AND COMMENTS
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Chris Halward
Professional Development Director, NOA
25th March 2014
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• Diploma in Outsourcing
Limited Early Bird Rate: £2,900- available until end of play Friday this week
• NOA Annual Symposium – 10th July
Limited number of complimentary tickets available for buyers
• Buyer Facilitation Service
Did you know that the NOA can help you fine-tune your RFI's?
• Supplier Directory
Our brand new online NOA's Supplier Directory will be opening next week!
• Award Submissions
Enter to the NOA Awards and NOA Outsourcing Professional Awards to showcase your achievements!
For further details please visit www.noa.co.uk
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Membership
The NOA offers two main types of membership; individual and corporate.
◦ Individual = benefits of membership are available for the named individual only
◦ Corporate = benefits of membership available to all employees at the named organisation
NOA Commercial Services
Organisations choose to engage with the NOA through our commercial services to:
◦ Raise their company profile and create awareness to those who actively engage in outsourcing
◦ Develop new business leads and enhance relationships
◦ Promote thought leadership alongside the NOA brand
Qualifications
◦ The NOA is the only UK entity to deliver university accredited professional development to the UK’s outsourcing industry. We offer a programme of both qualifications and training courses, focused on ensuring industry commitment to delivering best practice.
◦ Open to both buyers and suppliers and accredited by Middlesex University, NOA’s qualifications include the industry’s first foundation certificate, professional certificate, and diploma in outsourcing.
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