Applications outsourcing as a means to achieving transformation Aprajita Sharma Research Manager,...
15
Applications outsourcing as a means to achieving transformation Aprajita Sharma Research Manager, Outsourcing & BPO IDC Australia
-
Upload
liberty-scovel -
Category
Documents
-
view
221 -
download
1
Transcript of Applications outsourcing as a means to achieving transformation Aprajita Sharma Research Manager,...
Applications outsourcing as a means to achieving transformation
Aprajita Sharma Research Manager, Outsourcing & BPO IDC Australia
www.idc.com
Applications outsourcing as a means to achieving transformation
Aprajita Sharma Program Manager IT Services/Outsourcing
© IDC, 2008
AgendaAgenda
Overall Market Trends
AM Services Value Pyramid
AO as a means to achieving transformation
© IDC, 2008
OVERVIEW OF MARKET TRENDS
© IDC, 2008
Discrete vs. Bundled AM Services Discrete vs. Bundled AM Services
Domestic Service Provider
Delivered Onshore
DomesticService Provider
Delivered Offshore
Offshore Service Provider
DeliveredOnshore
Australia Application Management Services Spending
Discrete AM Services
AMS Embedded in ISO Contracts
AMS Embedded in BPO Contracts
Sourcing Model
Offshore Service Provider
Delivered Offshore
Covered in IDC AM Services
forecast
© IDC, 2008
Competitive AnalysisCompetitive Analysis
TCS
Wipro
HCL Technologies
InfosysSatyam
CGI-AMS HP
Capgemini
Hexaware Technologies
Unisys
Accenture
CSC
EDS
IBM
Opportunity Alignment
Ab
ilit
y t
o G
ain
Sh
are
Low High
Low
High Leadership
LegacyNiche
Followers
Australia Leadership Grid For Offshore Applications Management
© IDC, 2008
AM SERVICES VALUE PYRAMID
© IDC, 2008
The AM Services Value PyramidThe AM Services Value Pyramid
End-User Support
Reactive Application Maintenance
Proactive Application Enhancements
Legacy Modernisation
Remote Server Monitoring
Day-to-Day Operational
Responsibility
Portfolio Optimisation
Trans-formation
“Supporting User & Code”Low-end, delivered offshore“Supporting User & Code”Low-end, delivered offshore
“Enhancing the Code”Adding value to individual apps.
“Enhancing the Code”Adding value to individual apps.
“True Application Management”Operational knowledge &
responsibility
“True Application Management”Operational knowledge &
responsibility
“Partners for Transformation”Combination of business strategy
with application portfolio optimisation and transformation
“Partners for Transformation”Combination of business strategy
with application portfolio optimisation and transformation
Custom
er Business V
alue
© IDC, 2008
Role Of A Partner In Sustaining Application InvestmentsRole Of A Partner In Sustaining Application Investments
Do It BetterOperational
Excellence = Cost + Performance Improvement
Do It CheaperSourcing Strategy and
Cost-Advantaged Resources
Less
More
TransformationOperational Efficiency
Do It DifferentlyProcess and Relationship Innovation
Fix the ComplexityProcess Integration
Expertise and Consultative Skills
Degree of Complexity
Objectives
Professional services heritage. Increasingly included in outsourcing
Transformative approachrequires business process, application, infrastructure expertise.Innovation is critical for both the processes and the vendor-client relationship.
Traditional driver foroutsourcing. Entry point for global sourcing strategies.
BPO focus.Improvement through business strategy, performance mgmt., and process execution
© IDC, 2008
AO as a means to achieving transformation
© IDC, 2008
AO as a means to achieve transformationAO as a means to achieve transformation
• Enhanced overall enterprise functionality and efficiency
• Fixed Costs and Variable Payment Methods
• Guaranteed SLAs
• Continued access to skilled IT personnel
• Reducing the cost of maintaining and upgrading infrastructure
• Increasing Customer Satisfaction
• Mitigated Risk
• Enhanced overall enterprise functionality and efficiency
• Fixed Costs and Variable Payment Methods
• Guaranteed SLAs
• Continued access to skilled IT personnel
• Reducing the cost of maintaining and upgrading infrastructure
• Increasing Customer Satisfaction
• Mitigated Risk
© IDC, 2008
Partnering – Complexity V/s Potential SavingsPartnering – Complexity V/s Potential Savings
High
Low
Low High
Imp
lem
en
tati
on
Co
mp
lex
ity
Savings
Staff AugmentationCo-Sourcing
Transformation and APM
Skilled Resources are provided by partner on demand
Partners co-develop future statesharing cost and Risk
Partners performs thetransformation and assumes
risk
Note: Using these base structures organisations may adopt one or more to meet specific requirements
•30-40% reduction in product deployment time
• 40% faster systems implementation
• Improved faster conversion or consolidation of acquired assets (30-60% in time, 30% of costs)
© IDC, 2008
What is the roadmap going forward?What is the roadmap going forward?
Managing a larger portion of the application portfolio
Integrating services, such as portfolio optimisation, process reengineering
Transforming environment to Dynamic IT
Embracing new delivery models such as hosted AM
Building and managing SOAs
Synergising AO and BPO services
New strategies as a result of application vendor consolidation
Managing a larger portion of the application portfolio
Integrating services, such as portfolio optimisation, process reengineering
Transforming environment to Dynamic IT
Embracing new delivery models such as hosted AM
Building and managing SOAs
Synergising AO and BPO services
New strategies as a result of application vendor consolidation
© IDC, 2008
Essential GuidanceEssential Guidance
Move up the value chain by looking at application from a portfolio perspective: self-funding transformation
Embrace packaged application services while maintaining increasingly valuable legacy skillsets (are there any COBOL majors out there?)
Think strategically about global sourcing
Use project-based transformation services to start with-
Transformation is difficult!!
Invest in Hosted AM
Stop any investments not aligned to the vision !!
Move up the value chain by looking at application from a portfolio perspective: self-funding transformation
Embrace packaged application services while maintaining increasingly valuable legacy skillsets (are there any COBOL majors out there?)
Think strategically about global sourcing
Use project-based transformation services to start with-
Transformation is difficult!!
Invest in Hosted AM
Stop any investments not aligned to the vision !!
Its an evolution not a revolution!!!
