Outsourcing to India

The Success Story World Over

Agenda
Outsourcing in a Nutshell History of Outsourcing Why Outsource to India Big 5 and Competition Landscape Outsourcing models The controversies Quality Management SEI CMM Risk Management Right Sourcing TM Voice of the Customer Growth Picture - Challenges Real time Scenarios and Lessons Learned
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Outsourcing Defined
Sourcing your operations to a qualified external entity through a contract, thereby
Improve efficiency in core processes Improve shareholder Value Increase profits Invigorate growth Innovate products Insulate from risk, and Indulge in longer vacations
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History of Outsourcing
Y2K a raging problem for organizations Attack the problem in-house, or outsource An opportunity opens for India IT operations
Application Development and Maintenance E-commerce, ERP implementation etc..

BPO operations
IT Support, Bill Collections, Research & Analytics,Travel and Hospitality services etc..
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Why Outsource to India

Availability of qualified resources industry standard certifications Lateral knowledge skills technology and business skills Cost and quality arbitrage Strong and ethical Entrepreneurs Better tax structures and tax holidays - SEZ Economy on the growth path GDP Enthusiastic and young population
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Big 5 Competition Landscape-IT

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ERP Deployments-Indian IT
(Research by Forrester & Gartner )

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Big 5 IT Revenues & Employees

Source NASSCOM 22-Feb-2006 Slide 8 (of 24) Rajesh Prayaga, PMP

ITES-BPO Current Scenario

WNS Wipro BPO HCL Tech BPO IBM Daksh ICICI OneSource Exl Services Nipuna Services
Source NASSCOM
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Controversies and Concerns

What are the controversies?
Identity and data theft Insecurity Infrastructure Job losses Political Protectionism Quality Cultural
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Your Job is

Bangalored!

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Rajesh Prayaga, PMP

Current Picture
Prepare database of all employees Increase security Encourage dialogue Train in languages and accents Improve processes and quality of delivery Increase profits for customers Sustain Indias #1 position Develop Incubation laboratories
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Quality Management
Quality in PMBOK Set of inherent characteristics which fulfill requirements of customer Emphasis on enterprise wide strong quality models - CMM, Six Sigma,ISO 9001 Well defined and active Quality policies Accreditation from Carnegie Mellon University Quality Processes BS 7799, BvQI in systems PCMM for people CMMI Integrated Capability Maturity Model
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Risk Management
Risk by PMBOK Any uncertain event or condition with a positive or negative effect Enterprise wide risk planning
Security threat,data theft

Customer focused risk planning

BCMS Business Continuity, BS7799

Project based risk planning

Customer data, application deployment,operational issues

Resource based risk planning

Maintain repositories, train resources, contain attrition
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Outsourcing Life Cycle

Exit Renew Strategy

Accept Reassess

Monitor Select

Implementation

Negotiate

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Outsourcing Life Cycle - Detail

Strategy checklist of applications Reassess check for internal resources Selection evaluate vendor(s) SWOT Negotiate schedules and contracts Implementation start activities, training Monitor Reports, resources and activities Accept Validate and accept or reject Renew All is well, renew/extend contracts Exit All is not well, accept and exit
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Outsourcing Models
Data administration Local and Remote Application development and maintenance Remote Infrastructure management Business Continuity Data Storage Business Processes, Engineering Processes Complete testing processes- Reduce time to market Knowledge Processes
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Voice of the Customer

Outsourcing is not an IT panacea Higher revenues from more work at lower costs Joint Ventures much helpful Excellent Skill base Do not depend on single vendor What must be outsourced? Process and Quality checks required-customer X Quality policies stringent than ours customer Y
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Procurement -Trends
Major contracts Single Vendors Multiple Vendors

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Growth Picture and Challenges

2005 market US$150bn, >US$20bn- India 2010 market US$300bn by 2010, target US$60bn Grab billion $ deals Emerge as Tier-1 Suppliers Innovation, R&D,Standards Industry-University Collaboration Develop Talent Business & Process Consulting Search for emerging markets demand flow Brand building,JVs Invigorate and participate in infrastructure building
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Real time Scenarios

Business requirements translation Create a web enabled ERP application Deploying ERP application in Europe Conflict resolution

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Lessons Learned for Customers

A strong and competitive business case Devoted managers and team A comprehensive backup plan Open mind people and culture Multiple countries and multiple vendors Strong communications Active risk plan
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Lessons for Indian Companies

Change or die Ready for M&A activity Customer,investor and associate delight Superior scalability of operations Internationalize your Operations Near Shoring Become an MNC Hedge actively
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For more Information

Links to websites
News & Research
www.gartner.com/ www.atkearney.com www.bpoindia.org www.forrester.com www.cio.com www.outsourcingreporter.com www.firmbuilder.com

IT & BPO Companies

www.satyam.com www.infosys.com www.tcs.com www.wipro.com www.cognizant.com www.hcltech.com www.nipunaservices.com www.progeon.com www.wiprospectramind.com

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Questions & Comments

Q&A

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