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Outsourcing Insight

Admin , created on 9. July 2010, 03:54

Outsourcing need emerges when you want to enhance your capabilities to compete globally & control rising financial pressures. Organizations should brainstorm the merits of outsourcing on regular intervals with changing market conditions and technological changes. Outsourcing should be for appropriate reasons without losing control of resources and personnel, knowledge of whom is integrated with the organization's business practices & who has become a part of the organizational family.

Outsourcing evaluation questionnaire should contain questions about the company’s core competencies, services related to core competencies, corporate culture barriers, cross-functional impact, is outsourcing an absolute necessity, additional accomplishments by a vendor, outsourcing goals, people issues, etc.

The process of deciding whether outsourcing is warranted involves numerous steps or phases. The questionnaire should consider or answer the following- identifying challenges, preparing and distributing a Request for Proposal (RFP), examining proposals received, evaluating vendor capabilities, negotiating contract terms, and implementing outsourcing. It is important to adopt an explicit methodology involving steps to be taken and outlining the project plan evaluation.

The Phases of Outsourcing Evaluation plans are as follows:

  • Planning Phase -The objectives and nature of outsourcing are defined. The feasibility plan for outsourcing is tested before making a decision to proceed. The efforts are planned in terms of time required, budget estimation and resource allocation.
  • Analysis Phase - Key Performance Indicators (KPI’s) are determined; service levels expectations from vendors are specified. Relationships between the function/’s to be outsourced and functions that will remain in-house is clarified. This helps the company and the contract with the vendor to include proper integration with in-house services. The request for proposal is developed, responses are collected from vendors and analyzed, and a vendor is chosen.
  • Design Phase - Negotiations proceed with the vendor and a contract is developed and signed.
  • Implementation Phase - The transition from in-house provision of services to outsourcing is made.
  • Operations Phase - The outsourcing relationship with the vendor is managed and any maintenance or changes in the outsourcing relationship are negotiated and implemented.
  • Termination Phase - At the end of the contracting period the decision is made to negotiate another contract with the vendor or a new vendor all together, and the cycle begins again. Alternatively, a decision may also be made to bring the function back to the organization.

Managers who have made the decision to outsource should be able to predict the likely impact that outsourcing will have on the organization's stakeholders, who include stockholders, customers, suppliers, and employees.

For Larger outsourcing plans the top management should play a key role. For smaller initiatives the middle-level managers might do the project planning with the guidance & supervision of the higher managers/Management. The Outsourcing team should combine a mix blend of managerial and technical strengths. The team may also require indulgence from representatives from specific areas that will be directly and heavily impacted by the outsourcing. The user views always guide the balance between projected benefits and helps assessing risks involved.

The size of the team depends on the nature and size of the project. Smaller teams are generally more effective than larger ones. The team could be small in the planning phase and may expand when the analysis begins. Teams should comprise of full-time members instead of part-timers, as they are more focused and effective, although full-time allocations makes sense for Large-size Outsourcing Projects. Personal experienced in outsourcing are highly recommended on the team for the insight they bring to the issues and realism to cost and benefit estimates. External consultants are highly recommended.

Once the decision to outsource is finalized, identify the individuals who will be shouldered the responsibility for supervision, management and vendor relations after the contract is signed. These people should be part of the team that formulates the contract. Their inclusion is critical for several reasons. First, there is no better way to understand the issues involved in outsourcing than in all aspects of the deal. Second, relationships with vendors start at the moment the discussions begin.

When outsourcing threatens to upset the status quo in an organization, instances of outsourcing as of arising high costs or poor performance, internal sources may not be the best option for accurate estimates of costs or effectiveness. Under these circumstances an objective outsider for the assessment work is recommended.

Contracting relationships is a continuum of proposals, negotiations, SLA’s & KPI’s changing, redesigning along with redeployment. Organization always have a choice of choosing from vendors capable of performing the work, in relatively short contract durations, all if no then the choice to switch to another vendor at the end of a contract with little or no cost or inconvenience. At the other extreme are long term partnerships in which your organization contracts repeatedly with the same vendor and develops a mutually beneficial relationship that lasts a long time. The middle of the continuum is occupied by endurance of relationships that remain harmonious till the assignments are completed; these are termed "intermediate" relationships. Since it is a continuum, there are relationships that are closer to market relationships and relationships are closer to partnerships, as well as those that are midway between the two extremes.

There are several critical components of a versatile outsourcing agreement. The emphasis from the outset should be negotiating a fair and reasonable contract for both parties. Each aspect of the outsourcing relationship is governed by the contract, the organization and the vendor need to have a common understanding. This also means that managers must think of every possible business contingency and continuity to be covered in the contract. Steps governing dispute resolutions should be negotiated on a fair and equal opportunity basis. Outsourcing contractual agreement should not take the form of an open-ended assurance of goodwill, it should rather delineate who, what, when, and where of conflict resolution.

Some of the important contract considerations are Terms of the agreement, Minimum Services Levels, Ownership and Confidentiality of data, Warranty, Exhibits, KPIs and Incentives, Disclaimers, Bankruptcy, Non-Solict and Non-Compete, Super accelerated Events/ Act of God, Performance Measures, Status Reporting, Anticipating Change, Success Factors, Mainteance, Post Production Support, Payment Terms and Jurisdiction.

 

In The Pursuit To Sell Your Jewelry

Admin , created on 25. June 2010, 00:55

It is quite often that people ask this question, How do I sell my Jewelry? The answer could be: Jewelry selling is a science of meaningful expression. Deriving emotional value out of Jewelry is a connoisseur's delight. In our expertise, interspersed over the years, we have been trying to harness this aspect of the Jewelry Industry. Unless like a professional environment selling jewelry needs a casual approach and learning this helped me bring precision to the art of selling.

Lifestyle changes may have trimmed the love towards jewelry to its bare minimum but the charm it holds is undimmed by either career pursuits or the dictates of professionalism. Constant vigil at the designs is the price one pays for a fortune. So you need to be in Pursuit of changing trends and display your creation at the leisure of every possible opportunity. This has to be done wearing it the gaze of its admirers trying to get all possible glimpses at it.

Whether inherited or not but it’s all worth it. Adding more and more of it on your side will uphold its value and will always keep you amidst all conversations. Well in the ball room when all necks turn around to absorb the glaze of your possession, then those become priceless. You need to understand the importance of displaying it in real or photos and most importantly to get a feedback. Write about to all who have praised it and have shown similar interest towards possession, you can blog about it. Give your customers a face and personality to associate with your product and get them interested in what you're going to do next. Social Media could be a key to Buzz(yahoo) the Tweet(twitter) in the Face(book) of people Linked(in) to You(tube).

Microsoft has made the technical world very simple and smooth. Ever since Microsoft has come up with ASP.NET there has been a widespread debate among programmers as to whether it is better than any existing open source language like PHP. If we compare ASP.NET with PHP, ASP.NET wins as being an object oriented it is more organised and maintainable than scripted PHP. Newer version of PHP supports OOP but its very limited compared to ASP.NET. When we talk about flexibility too ASP.NET  is one step ahead of scripting languages. ASP.NET is much faster and has a great debugging support. PHP being a scripting language promotes messy code which lead to poor handling capability. We have experience with ASP.NET as well as PHP and over the period realized .NET is much better for high tech web applications. Once we had to convert a PHP based jewelry website to .NET. After this conversion, we compared the load test and realized that there is slight reduction in hosting cost because of inbuilt support in ASP.NET for session scaling like state server and SQL server based sessions. PHP need more processing power than ASP.NET. Scripting Language like PHP is scalable but ASP.NET is more scalable & provides a good support.

Its not that PHP does not work well but its like PHP is simpler, quicker to learn, faster to deploy smaller applications, but when we talk about large applications ASP.NET is prefered due to its robust programming  model and excellent support. When we search about the speed of PHP and ASP.NET, PHP wins the race theoritically and is total a myth, actually when we practically observe ASP.NET is much faster.It has become much like religious arguments that ignores facts .

Not only this there are many questions that come when we think of Microsoft technologies. Will OSS ever displace traditional Software from its market leadership position? We already discussed the framework now lets see some points regarding operating system too. If we take Operating System Linux, a OSS and Windows, the Microsoft product, both differ in philosophy, cost, ease of use, versatility and stability with each seeking to improve in their perceived weak areas.

One big advantage to Microsoft technologies is the Market Share and the popularity. But still neither side is likely to be forced from battle field. OSS offers too many benefits to the users even then most important thing that is the market share which is with Microsoft technologies. Because the value of Operating System that is Linux or Windows depends on the number of users so traditional  softwares has an advantage here. Sometimes the behavior of these technologies are like the customs and religions . People are following certain trends and traditions because it is coming in hierarchy , ancestors are following the chain cycle . Similar happens with the traditional software which people are using and do not want to change ,they think it is providing all facilities that the new OSS are providing them so why to switch to new one to waste time and energy. Cost  assymetries plays a great role, since OSS are freewares. So here in the absence of cost assymmetry windows took the first movers advantage. Oss can never displace Microsoft technologies of its leadership position. Now the question arises to make this cost factor symmetric. Can the Microsoft use piracy strategically to improve its market position?  Now we check the effect of piracy on Microsoft. When we compare the piracy rate of Microsoft and penetration power of other new OSS. We find the piracy is highest. Now this shows Microsoft can use piracy and people are using them instead of using available open source softwares. 

Open source softwares are coming into market showing their importance  but it cannot displace Microsoft Technologies from its market position. Every successful Corporation like Microsoft takes the responsibility to provide more user friendly, robust and scalable platform to its customers and leave a positive impact on the world and its people.

We @ Rigel Networks are Microsoft Partners delivering robust software solutions based on Microsoft Technologies as well as OSS.

Software Services As A Commodity

Admin , created on 9. August 2009, 19:47

45% of techies after getting 5+ years of IT experience undertake software projects as independent consultants or start a software company. Software services like web, desktop and mobile development need penny investments of computer, software tools and internet connection. In this fast growing digital world, youngsters seek rapid personal growth and have an indepedent working mindset which says "I Can Do Better Myself". Open source software  has fueled commoditization of software solutions and IT services and has given customers options to choose from multiple low cost service providers. Again with recession laying off techies, we expect more and more independent contractors coming out with application development and maintenance service. Softawre companies are "Mushroom-Like" growing rapidly all over in quick time. However in many cases, customers business is burnt and affected as small start up companies and contractors are unable to meet deadlines and deliver quality projects. Tech companies need to demonstrate past success, consultative proactive approach and develop an end to end service portfolio to act as one stop shop. Customers need to check YoY growth of IT service provider, interpret extent of successfully executed past projects in growth of customers business, interview service providers executive management, processes followed, get customer references and do an overall background check before getting associated for a long term project. After awarding the project,  regular monitoring of progress and cross checking delivery in alignment to business objectives helps customers and software service provider build and maintain a long term mutually beneficial business relationship. Beware of start up freelancing companies and individual consultants.

We @ Rigel Networks help customers with technology consulting, design, delivery, maintenance  and support of application along with third party integration, server maintenance and hosting.

Collaboration

Admin , created on 23. July 2009, 03:43

Collaboration in real time is helping businesses to know whats going on in market. Hi-Tech companies like Oracle, Microsoft, Dell enagage with communities on Facebook and invite users to share their ideas and expectations. Tweets are the buzz word these days & it was proven when US Government requested Twitter to hold on their upgrade. Hi-Tech companies look for faster innovation and making money from information. Huge amount of unstructured information is available to organizations from external and internal sources. Collaboration helps utilizing this pool of unstructured information to innovatively co-create products with customers and offer a superior customer experience. Innovation in collaboration is being realized with tweets, video sharing, blogs, wikis, widgets, podcasts, and social networking sites. 

Facebook recently announced Developer Contest in India inviting users to develop applications for it and integrate the social networking portal with other applications. Internet companies are opening up applicaitons promoting collaboration via modular architecture, APIs and third party alliance. It is very important that business leaders draw inspiration from such instances and enhance their collaboration touchpoints. Collaboration must evolve traditional technologies and innovate current technologies. I believe that companies that judiciously adopt Innovation In Collaboration will be better positioned to create competitive advantage in this highly competitive world.

Why Outsourcing Fails?

Admin , created on 15. July 2009, 17:37

- Overpromising during the sales process, creating unrealistic expectations on the customer’s part
- Inappropriate structuring of the relationship, resulting in a divergence of interests over the life of the engagement
- Lack of attention to transitional details, resulting in relationship problems at the outset
- A lack of flexibility by both parties as business needs and operational requirements change
- Cultural mismatches between the organizations
- The use of benchmarking data to defend existing positions instead of generating improvements
- A high rate of turnover, especially among individuals responsible for managing the relationship
- Implied expertise in relationship management that does not exist
- Customers failing to think through their business objectives, especially as these change during the engagement
- Business leaders use a multidimensional approach when measuring alliance success as opposed to the one dimensional measures (cost savings, relationship factors, or resource access factors in isolation)
- A variety of financial, supplier competence, responsiveness, relationship, and resource access measures should be used to determine the success of alliance relationships
- Suppliers should offer more than lower costs to potential strategic customers

Experience transformational outsourcing with Rigel Networks.

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