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Managing Large Outsourced Projects A presentation By Sanjay Rai

Managing Large Outsourced Projects

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Managing Large Outsourced Projects. A presentation By Sanjay Rai. The Market. Outsourcing Industry Expected to Hit $100 billion by 2010 Outsourcing Requires Change in Management Approach - PowerPoint PPT Presentation

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Page 1: Managing Large Outsourced Projects

Managing Large Outsourced Projects

A presentation

By

Sanjay Rai

Page 2: Managing Large Outsourced Projects

The Market

Outsourcing Industry Expected to Hit $100 billion by 2010

Outsourcing Requires Change in Management Approach

Initial Wave (Small or medium non-critical) applications giving way to large and mission critical application outsourcing

Ability to manage Second Wave projects is key to companies success

Page 3: Managing Large Outsourced Projects

Key Issues – The Inverted Pyramid

Transfer Complex Domain Knowledge

Inte

grat

ing

Mul

tiple

Use

r Set

s

Managing M

ulti Vendor D

eliveries

Data Collation And Reporting

Production Rollout

Page 4: Managing Large Outsourced Projects

Why Inverted

Unlike In-house Projects Outsourced projects are built bottom up

Domain Budget Resource Deploy

DomainBudget Resource Deploy

In House

Outsourced

Identify Cost Advantages

Select Vendor Start ProjectTransfer Domain

Knowledge

Identify Project From Domain Knowledge

Define Project Costs

Identify and Allocate

Resources

Build and Maintain Software

Page 5: Managing Large Outsourced Projects

Transfer Domain Knowledge

Typically Effort in Acquiring Domain Knowledge Versus Effort on Developing the Application is

– 30% when the development team starts from scratch– 20% when the development team has domain expertise– 15% when the build team incorporates domain experts from the

client organization Attempts to cut these times leads to a lack of domain

knowledge resulting in time and cost overruns due to :– Poor Scoping– Bad Architecture– Incorrect Configuration

Strategy: Use Domain Specialists to:– Knowledge Transfer Session from end User– Get Certification for development team (if available)– Have Formal induction process for each of the project team

member– Conduct Internal knowledge assessment sessions

Page 6: Managing Large Outsourced Projects

Integrating Multiple User Sets

Business functionality is spread across various departments leading to

– Conflicting user requirements– Scheduling conflicts leading to implementation delays– ‘Turf Wars’ over ownership of data

Fragmented Business Processes– No single view on end-to-end process for a business operation– Implicit manual intervention where systems are not adequate– Decision making authority for business operations not clearly

defined Strategy: Keep User Management Separate from

Development– Have core user team represent all departments – intra

organization– Set up internal change management to help users transition to

new systems and processes

Page 7: Managing Large Outsourced Projects

Managing Multi-Vendor Deliveries

Vendors have differing priorities for the project:– Required resources not available at the same time– Commercial constraints restrict vendor deliveries– Scheduled releases of products do not match project schedules

Conflict between vendors– Information not shared across vendors– Delaying tactics adopted by some vendors to prevent others from

delivering– Problem resolution sessions degenerate into a “blame game”– Simple technical solutions cannot be implemented due to inter-vendor

rivalry Strategy: Keep Delivery and Commercial management separate

– Steering Committees for delivery planning and management– Commercial Manager for handling commercial issues– Formal Organization Structure clearly defining relationships – Clearly define

Responsibilities Risk Ownership Backup Strategy (in case of Vendor Failure)

Page 8: Managing Large Outsourced Projects

Data Collation and Reporting

Process not geared to meet project objectives– CMM alone does not help– Control degenerates into bureaucratic bottlenecks– Process used as an excuse for non-delivery

Data collected is unusable– Validity of data is suspect– Data is no longer relevant– Important information is lost in “chaff”

Lack of data to control scope– Scope measures not defined or not implement able– Scope creep in small increments– “Value Add” taken as license to agree to everything

Strategy: Set up process for delivering user experience– Measure progress against requirement delivery – Hire experts for project management (onsite and offshore)– Project manager travels along with the project (in multi-location cases)– Have project data audited periodically– Do not have separate processes for creating project data

Page 9: Managing Large Outsourced Projects

Production Rollout

Multiple Environments (Develop, Test, Deploy, Debug)– Different versions in different environments– Traceability from development to deployment– Defects reported from production not replicable– Data inconsistency makes deployment environment unstable

Process adherence looses out to delivery commitments– Quality of delivered application is uncertain– Production configuration does not match delivery– Scope changes not documented

Strategy: Rollout in Phases till steady state– Size phases into manageable “bites”– Use Risk Based Management to schedule phases– Strategize for Product Upgrades– Manage Data as an independent activity

Page 10: Managing Large Outsourced Projects

Key Management Practices

Identify appropriate management framework based on type of project:

– Technology – Object Oriented or Legacy– Strategy – Waterfall, Spiral, RAD, JAD etc.– Location – Single or Multiple

Use an integrated risk management practice– Involve all parties– Make risk monitoring a part of reporting– Centrally manage risks across multiple teams

Keep focus on delivery– Focus teams on deliveries– Ensure all components are delivered together– Make it easy to fix penalties

Page 11: Managing Large Outsourced Projects

Management Structure

Page 12: Managing Large Outsourced Projects

Delivery Types

Fixed Time – Scope and Cost can vary deadline remains fixed– Deployment ‘as available’ prevents delays– Makes it possible to plan related activities and schedule resources

well in advance– Can adversely affect quality

Fixed Scope– Time and Cost can vary as scope is fixed– Ensures that all user requirements are met– Assumes that all requirements are clearly defined at the start– Pressure on teams to get things “right first time”

Fixed Cost– Scope and time may change but effort remains constant– Protects the budget– Requires imaginative and flexible planning– Danger of having 100% tasks 90% complete when the budget runs

out

Page 13: Managing Large Outsourced Projects

Fixed Plus Variable Type

Create multiple phases with a “fixed time”– Makes it possible to orchestrate multiple parties and activities– Advance planning can significantly reduce costs– Vendor measure for each delivery can be used to measure

performance For each phase have a core “fixed scope” and an optional

“variable scope” against a “fixed cost”– Gives client a clear view of the minimum delivery– Gives vendors the ability to add features and functions to improve

user experience– Gives planning flexibility to create and execute risk mitigation

strategies– Makes is possible to de-centralize the planning and scheduling

process– Protects the budget within a band– No need to freeze requirements giving users more flexibility– Helps to scope out subsequent phases since unfulfilled

requirements are documented

Page 14: Managing Large Outsourced Projects

Reviews

Daily Reviews– Plan Vs Actual Yesterday– Tasks Planned for Day– Issues Outstanding– Risk Escalation

Weekly Review– Schedule Vs Actual (YTD, and Week)– Issues Outstanding– Risks – Defect Rates

Monthly Reviews– Schedule Vs Actual (Cumulative and Previous Month)– Plan Changes– Contingency Planning– Delivery Status

Page 15: Managing Large Outsourced Projects

Key Metrics

Percentage Tasks Completed Vs Planned Defect Rates Budget Vs Actual Percentage Tasks Completed on Time Risks Materialized Risks Outstanding Percentage Issues Resolved Ageing analysis of Outstanding Issues

Page 16: Managing Large Outsourced Projects

On Going Registers

Issue Log Change Control Log Risk Register Delivery Log Defect Log Configuration Log

Page 17: Managing Large Outsourced Projects