Outsourcing: reducing operational risk

for ALB Conference 2006

Outsourcing: reducing operational riskOutsourcing: reducing operational risk

Adrian Amariei

CEO, Axonite

Adrian Amariei

CEO, Axonite

19 oct 2006 2 of 18for ALB Conference 2006

AgendaAgenda

The promise of outsourcing

Who does it and why

Selecting and managing an outsourcing partner

Our experience at Axonite: the sell, the good, and the bad, and still the good

The promise of outsourcing

Who does it and why

Selecting and managing an outsourcing partner

Our experience at Axonite: the sell, the good, and the bad, and still the good

Today we will talk about:Today we will talk about:


Current trendsCurrent trends

Factors driving today’s business environment

• Standardization

• Increasing competition

• Ever-changing legislation

• Upturn in the economy

• Economic migration

• Demographic changes

• Social trends

• The Digital networked economy

Factors driving today’s business environment

• Standardization




• Economic migration


• Social trends



Why outsource?Why outsource?

• Non-responsive IT department missing delivery dates = lost market opportunities.

• Difficulties to catch up with Technology changes and innovation

• Shrinking IT CAPEX

• Own IT organization does not provide industry best practices and processes

• Multi-IT vendor environment = resources spent into managing contracts

• Need to focus on core business.

• Non-responsive IT department missing delivery dates = lost market opportunities.

• Difficulties to catch up with Technology changes and innovation


• Own IT organization does not provide industry best practices and processes

• Multi-IT vendor environment = resources spent into managing contracts



Who does it and whyWho does it and why

• Economies of scale and scope

• Arbitrage: labor, skills and infrastructure

• Economies of scale and scope

• Arbitrage: labor, skills and infrastructure


Outsourcing guidelines 1 of 2Outsourcing guidelines 1 of 2

• Answer this: “why do you want to do it?”

• Consider any activity and processing that:

• Is rule based

• Is transactional

• Is repetitive

• Is not core

• Has high volumes

• You can measure properly

• Don’t touch Strategic differentiators

• Answer this: “why do you want to do it?”

• Consider any activity and processing that:

• Is rule based


• Is repetitive

• Is not core



• Don’t touch Strategic differentiators


Outsourcing guidelines 1 of 2Outsourcing guidelines 1 of 2

Managing your outsourcer

• Pay attention to SLA

• Check regulations on the issue and outsourcer compliance

• Verify security of data transfers and processing

• Ask for referrals

• Check reaction time and quality to your requests

Managing your outsourcer

• Pay attention to SLA

• Check regulations on the issue and outsourcer compliance

• Verify security of data transfers and processing

• Ask for referrals

• Check reaction time and quality to your requests


My Experience at AxoniteMy Experience at Axonite

• Axonite is about enabling the “real-time enterprise” with mobile messages.

• We bridge business processes to real people in 6 seconds.

• We connect Enterprise applications and databases to mobile phones.

• Challenges we encountered, despite clear value proposition:

• Enterprise pricing expected to be same as retail pricing.

• “I can do that too” and TCO

• Data quality

• Axonite is about enabling the “real-time enterprise” with mobile messages.

• We bridge business processes to real people in 6 seconds.

• We connect Enterprise applications and databases to mobile phones.

• Challenges we encountered, despite clear value proposition:

• Enterprise pricing expected to be same as retail pricing.

• “I can do that too” and TCO

• Data quality


How it works, actually How it works, actually

• Let's see a quick live demo.

• If you want to be part of it, please send a SMS with command ‘N’ and your first name to: 0788 555 555

Example: ‘N Gabi’

• Let's see a quick live demo.

• If you want to be part of it, please send a SMS with command ‘N’ and your first name to: 0788 555 555

Example: ‘N Gabi’


Why is this outsourcing strategic, and “real-time”…… all at the same time??Why is this outsourcing strategic, and “real-time”…… all at the same time??


Performance Indicators Framework 1 of 3Performance Indicators Framework 1 of 3

Customer

• Customer Satisfaction

• Self-service

• Completeness Response Rate

• Service Availability

Customer

• Customer Satisfaction

• Self-service

• Completeness Response Rate

• Service Availability

“If you can’t measure it – it doesn’t count” John Yard“If you can’t measure it – it doesn’t count” John Yard

Customer, Financial, StrategicCustomer, Financial, Strategic



Financial

• Call-Center OPEX

• Aging of accounts receivable

• Risk management

Financial

• Call-Center OPEX

• Aging of accounts receivable

• Risk management




Strategic

• Business advancement in face of competition

• Time to market

• Innovation

• Continuous Improvement

Strategic

• Business advancement in face of competition

• Time to market

• Innovation

• Continuous Improvement



What’s next?What’s next?

• It’s all about money in and money out. That is, PROFIT.

• Gain your independence – escape the prison named ‘license’

• You need to be agile in the market place – though times are ahead

• Have your next providers earn your money

• Go SaaS with some of your business processes.

• It’s all about money in and money out. That is, PROFIT.

• Gain your independence – escape the prison named ‘license’

• You need to be agile in the market place – though times are ahead

• Have your next providers earn your money

• Go SaaS with some of your business processes.


Quick review 1 of 3Quick review 1 of 3

Trends:





• Social trends


Trends:





• Social trends




Why outsource?

• Non-responsive IT department = missing market opportunities.

• Difficulties to catch up with Technology changes and innovation.


• Own IT organization has natural limitations


Why outsource?

• Non-responsive IT department = missing market opportunities.

• Difficulties to catch up with Technology changes and innovation.


• Own IT organization has natural limitations




OK, we outsource – IF…

• Is rule based


• Is repetitive



OK, we outsource – IF…

• Is rule based


• Is repetitive




Adrian Amariei shall welcome your comments at

[email protected]

+40 21 323 94 63

Adrian Amariei shall welcome your comments at

[email protected]

+40 21 323 94 63

Documents

Outsourcing: reducing operational risk