At the noa symposium Kerry Hallard shared her view that outsourcing contracts are reducing in duration to perhaps three years. This presents a challenge to delivering cost effective transformation.
When an organisation decides to outsource for the first time or switch to a new partner they do so because they expect (and contact for) a benefit. The outsourcing provider has their systems, tools and processes that they deploy to deliver cost savings and efficiencies. But this deployment is often costly and time consuming. It’s not unheard of for the first year of a large outsourcing contract to be spent on transformation, with the upfront costs spread over the ten year duration.
So if contracts are only going to last for three years how can the cost of an extensive transformation be economically recouped?
I suggest that it can’t, so we need another way:
One option is not to transform – just take on the service and run it as-is. But if you don’t do any transformation then how will the benefits be delivered?
Perhaps, instead of applying the transformation to the complete service, a Design Thinking approach can help focus the minds of the customer and supplier on the areas that really matter.
– Start by understanding why the customer wants to outsource. What benefits are they hoping to gain?
– Identify and prioritise the components of the outsourced service are core to delivering the required benefits (be that accounts payable, recruitment, IT infrastructure, facilities management, etc.)
– Run Agile sprints to transform these components into the new way of working.
– Measure the benefits delivered at the end of each sprint, and compare to the cost of delivering it.
– Don’t transform the non-core components if there isn’t going to be a measurable benefit in doing so
This approach does make me concerned about what is called technical debt in the IT world. Eventually everything will break if it isn’t improved. The non-core components could be addressed as part of a continuous improvement programme that runs throughout the contract.
These are just some initial thoughts. What do you think?
So here’s my second attempt at a weekly success invoice. It’s interesting to see how much discipline is required to actually fill this out! I’ll update the content as I progress and hopefully have several successes by the end of the week.
|What difference do I want to make?||Support colleagues in running a client innovation day for a telco client
Continue to help progress the Extreme Blue project
Make progress on an internal reporting project
Write up another innovation success story !
Present to the Extreme Blue Interns about IBM Global Technology Services – to help them understand more about working in IBM
Support client teams by running quarterly innovation reviews
Help a client team plan an innovation day for a retail client
|Successes this week||Completed an innovation success story describing a cloud and security initiative
Agreed the way forward for an internal reporting project and already have an updated template for the innovation plans I ask each account team to complete every quarter.
|Value I’m adding||Created and distributed the joining instructions for an Innovation Leaders Masterclass in September
Reviewed the structure for a white paper produced by the Extreme Blue team
Presented to the Extreme Blue interns about IBM, my career and Global Technology Services. (You can read the Extreme Blue blog here).
Ran some innovation reviews with client account teams. Suggested some people who could help progress some of the innovation initiatives.
Helped a client account team with their planning for an innovation workshop
Hosted the researchers I am working with from Loughborough University – shared my insights into IBM’s adoption of Design Thinking and Agile in the context of innovation.
|Key contribution this week||Helping the Extreme Blue team keep focussed on delivering the core functionality that our client has asked for. I reviewed their work several times this week – and it improved significantly each time!|
|Who is benefiting from what I’m doing?||The Extreme Blue teams
Loughborough University Researchers
Client account teams I am supporting
Who would have thought I’d find it so hard to make time to complete a success invoice every day? I guess a combination of work and family pressures meant that I missed a few days last week. So I’ve decided to do a weekly success invoice instead. At the start of the week I’ll post my plans, and at the end of the week review how well I did.
|What difference do I want to make?||Support a Smarter Buildings meeting with a client – help to align client requirements with IBM and partner capabilities.
Produce a client innovation success story
Progress updates to our Innovation Masterclass course
Continue to mentor the Extreme Blue team I am working with – in particular help them to keep focussed on the specific data requirements our client specified last week.
Start to plan an internal idea online generation event focussed on bringing Agile practices to part of the business.
|Successes this week||Completed a Taste of Agile course, which has inspired me to encourage the teams I work with to approach innovation in a more agile way.
Completed a client innovation success story ready for internal publication
Learned about Watson for Technical Support services – will look at how we can help clients benefit from this innovation
|Value I’m adding||Provided a collection of innovation examples and resources to a colleague who is working on a proposal for a new client.
Helped the Extreme Blue team gain clarity on some of their work and effected introductions to some people who can help them make further progress.
|Key contribution this week||Ran a successful smarter buildings client workshop and gained agreement to define a Proof of Concept to be run in one of my client’s offices.|
|Who is benefiting from what I’m doing?||A student who is spending his summer with IBM shadowed me at the Smarter Buildings meeting – I think he learned a lot from this client meeting.
Helped a colleague with her plans for a major client project
|What difference do I want to make?||Help to make progress on an internal data analysis project
Write-up a success story for an innovative cloud & security project some colleagues delivered for a client.
|Successes today||Completed the success story – almost ready for publication; just needs a final review
Agreed the scope & content for a Technology Innovation Exchange presentation.
|Value I’m adding||Provided feedback about the members of a team I’m working with to their manager to help with their development & progress evaluation|
|Key contribution today||Agreed a plan for the internal data analysis project – and successfully logged-in to the server where the software will be installed (small victories!)|
|Who is benefiting from what I’m doing?||No immediate benefit today – however I expect that many colleagues will eventually benefit from the insights we gain with the data analysis project. Similarly, I hope that the success story will benefit many colleagues as & when they need to design similar solutions.|
|What difference do I want to make?||Support the extreme blue team so that they have a successful client presentation.
Share insights into Agile adoption
|Successes today||Gained client agreement to take a proposal to the relevant business leader for their support.
Agreed with a client that the Extreme Blue team can borrow some technology for their project – this will help make the demos more real
|Value I’m adding||Shared some ideas and insights on Agile with a team who have a mission to help their client’s CIO to enable his team to become more Agile|
|Key contribution today||Supported the Extreme Blue team in their client show & tell session|
|Who is benefiting from what I’m doing?||The Extreme Blue team
The client account team I was discussing Agile with
|What difference do I want to make?||Inspire a team of architects and specialists to start innovating|
|Successes today||Presented “What is Innovation and how to get started” to a team of architects & specialists
Agreed with a Business Development colleague that he will accompany me to a client meeting on Monday to discuss taking a joint research project into production
Produced a draft success story for an innovative cloud & security project that a client team recently delivered
|Value I’m adding||Helped the Extreme Blue team to finalise their preparations for their client sponsor presentation on Monday|
|Key contribution today||Created a framework for a presentation that a senior colleague will be delivering at the next Technology Innovation Exchange|
|Who is benefiting from what I’m doing?||The architects & specialists I presented to
The Extreme Blue team
|What difference do I want to make?||Help the Extreme Blue team I am mentoring to make progress with their project, and prepare for the client presentation next Monday.Host a colleague from Loughborough University, with whom we are conducing some joint research – make sure that he has everything he needs to gather the information he requires.|
|Successes today||Had a good planning session with the Extreme Blue team as well as a 1-2-1 mentoring session with one of the interns.My colleague from Loughborough had a very useful day observing the team interactions and conducting interviews.
Agreed proposed definitions with some colleagues for a new internal innovation accreditation system
|Value I’m adding||Provided the Extreme Blue team with insight into the most suitable presentation style for the meeting next Monday.Made some (hopefully) useful suggestions to other Extreme Blue teams to help them progress their projects|
|Key contribution today||Identified that the team were (understandably) nervous about the presentation; explained that these particular clients were very friendly and positive. Also coached the team on how to receive feedback.|
|Who is benefiting from what I’m doing?||The Extreme Blue teamLoughborough university research team|