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© 2014 IAOP® All Rights Reserved www.IAOP.orgGSOS Copyrighted & All Rights Reserved

SOURCINGRELATIONSHIP

VALUEFRAMEWORK

TM

Performing An Outsourcing Relationship Health CheckTM

Using Standard Processes, Tools & TechnologiesCustomer ONLY Webinar

17-18-14


Key Questions We’ll Answer Today For Customers/Buyers:

What’s one of the biggest opportunities facing the customer/buyer

community in the global outsourcing industry and why?

What is an Outsourcing Relationship Health CheckTM and whyshould customers/buyers perform them?

What will you experience when performing an Outsourcing Relationship Health CheckTM?

What data/information will you have access to as a result of performing an Outsourcing Relationship Health CheckTM?

What are the benefits & costs of performing an OutsourcingRelationship Health CheckTM & how do you get started?

© 2014 IAOP® All Rights Reserved www.IAOP.org

Share of

GSOS Copyrighted & All Rights Reserved

One of the Outsourcing Industry’s Biggest Opportunities:

• $13 - $16 Trillion of existing services outsourcing (ITO/BPO/KPO) & shared service center contracts/relationships in force globally

• 50%+ of business leaders believe there’s opportunity for improving

the value from their portfolio’s

of contracts/relationships

• Actual results from recent “health

checks” indicate there are “always”

opportunities to improve business value, often ranging in tangibleterms from 5% to 30%+ of annual contracted spend!

Projected ACV Expiring in 2014 by Service Provider

Source: ISG Contracts Knowledgebase


“How do you quickly, effectively and affordably assess & then improve the

overall health and business “Value” from existing outsourcing and/or share service center relationships?”

One of the Outsourcing Industry’s Biggest Challenges:

Value =

Health = Overall qualitative assessment of the relationship

Health+ Delivery Performance

Delivery Performance = SLA & contractual compliance

Cost

Cost = Total cost of the relationship


Are There Tools & Technologies to Help?

Yes…But Not Quite Yet!


Vit

al S

ign

s o

f H

ealt

h Financial Performance

- Better managed &/orreduced costs

- Revenue growth- Improved margins- Improved assetutilization/balancesheet performance

- Access to new markets

HR

P

ay

ro

ll

Em

plo

ye

es

SCMProcurement

Suppliers

Cu

sto

me

rs

CR

M

- Provide access torequired talent/skills

- Improved flexibility - Improved ability to beresponsive/scalable

- Improved adaptability- Access to industry bestpractices

Capabilities Service Quality

- Defined SLA’s withaccountability

- SLA’s performance- Quality of resources- Low turnover & highretention rates

- Continuous improve-ment & innovation

Governance

- Clear RACI models- Processes for issuemanagement/escalation

- Business case & value realization & reporting

- Transparency into supplier operation

- Competitive T’s & C’s

Risk & Compliance

- Defined risk profile- Processes to identifymonitor, mitigate &report on risks status

- Periodic Non- SLAcompliance reviews

- Global compliance- DR & Contingency Plans

IDEA ASSESSMENT IMPLEMENTATION TRANSITION MANAGEMENT


VALUEFRAMEWORK

TM

FrameworkFor Healthy

Relationships

Sourcing RelationshipManagement

(SRM)

Service Providers

ERP

The Outsourcing Life-Cycle – Per IAOP’s OPBOK

ValueHealth Check

Creating & sustaining high performing outsourcing & shared service center relationships requires a dynamic balance be maintained across the “vital signs of health” in global outsourcing.

Corporate Social Responsibility (CSR) in Global Outsourcing



VALUEFRAMEWORK

• A rapid 3 Phased Process that leverages best practices, advanced tools/technology & focused Advisory Assistance.

• The Sourcing Relationship Value FrameworkTM

is the foundation for the Value Health Check Survey

TM(VHCS)

tool.

• VHCS is a cloud-based diagnostic survey useable on any type of outsourcing (ITO/BPO/KPO) & shared service center relationship whether on, near, or off-shore.

• Demographic data collected through the VHCS survey enables future peer group scoring and relationship trend analysis

• The Health Check Process & VHCS are easily customizable to the unique needs of any outsourcing &/or shared service center relationship(s)

What is an Outsourcing Relationship Health CheckTM


Key Customer Benefits of Performing a Health Check• Understand your team and service provider team’s degree of alignment across five

(5) key areas of outsourcing value that includes 40 discrete value drivers.

• Identify the key strengths in the relationship, major opportunities to improve value including an action plan that includes resources assigned, timelines and risks associated with the action plan.

• Customer & Service Provider get objective, third-party assistance throughout the Health Check process to ensure minimal disruption to your operations as well as complete facilitation and guidance including documentation of interim and final reports for use by all parties

• Get insights concerning how your outsourcing relationship(s) compares with similar relationships around the world and how other organizations are addressing similar contemporary challenges to relationship success.

• Optionally you can use the complimentary Leadership Pairs Effectiveness Assessment to quickly determine how closely aligned the customer and service provider relationship leaders are around 10 critical success areas in outsourcing relationship leadership.




VALUEFRAMEWORK

TM

When Should Customer’s Perform An

Outsourcing Relationship Health CheckTM

?

• At the beginning of the outsourcing relationship lifecycle to establish consistently understood priorities & value expectations

• If you’re at all unsure about the actual health

and/or value you’re getting from your existing

outsourcing relationship.• If you’re 12-18 months away from a

contractual renewal and are considering your options.

• We recommend you periodically perform a “Health Check” on your outsourcing

relationship just as you would on yourself.


Overview of the Outsourcing Relationship Health Check ProcessTM

PeriodicHealthCheck

ImplementHealth Check

Plans

Final VHCSReport &

Action Plan

Phase 3 – Refresh(4-12 Weeks)

Advisory Assistance is Optional in Phase 3

Health CheckFinal

Report

VHCSSurveyPeriod(1 Week)

LaunchVHCS

Health CheckPrelim.Report

Phase 1 – Assess(2-3 Weeks)

Use Value Health CheckSurvey (VHCS) Tool

(2 VHCS required for a Health Check)

•Assign Certified Health Check Advisor to Engagement•Identify Customer & Provider Health Check Administrators •Sign & Accept Terms of Use Agreement•Complete Health Check Demographic Profiler•Complete Health Check Participant Profilers•Prepare Health Check Participants

Via Webinar

CustomerInternal

De-Briefing

ProviderInternal

De-Briefing

Customer& Provider

OpportunityWorkshop

Phase 2 – Analyze(2-3 Weeks)

Use Value Opportunity Matrix (VOM) &Leadership Pairs Effectiveness Assessment

(Leadership Pair Assessment is optional and complimentary)

1-2 HrReview

PREP

PREP

Onsite &/or Webinar


How Does An Outsourcing Relationship Health Check Fit With Our Existing Performance Tracking Processes?

• The Outsourcing Relationship Health Check process is not designed to replace your existing performance tracking processes and tools. Rather, it is intended to compliment, enhance and broaden your understanding of the key drivers of high performing and sustainable outsourcing relationships and provide you with insights on how your relationship stacks up in key areas to peer group relationships.

• While there is a fixed set of eight (8) value drivers in each of the five (5) domains of outsourcing value, the Health Check can be quickly and affordably adapted to include additional areas of value that are unique to your business and/or relationship.



SOURCING

RELATIONSHIP

VALUE

FRAMEWORKTM

Using The Value Health Check Survey (VHCS)


Value Statements are Adjusted to Fit Customer and Service Provider Context

Example: Financial Performance:

Customer Statement: We are realizing the business benefits from the outsourcing relationship as outlined in the original business case &/or contracts.

Provider Statement: Our client is realizing the business benefits from the outsourcing relationship as outlined in the original business case &/or contracts.

Example: Service Quality:

Customer: We have adequate transparency into supplier performance and supporting data/systems to appropriately understand supplier performance.

Provider: Our client has adequate transparency into our performance and supporting data/systems to appropriately understand our performance.


VHCS: Customer Version

Step 1. Read the Value Statement& Score The Current Priority

Step 2. Score your levelof agreement



High (9-10) or Low (0-1) Scores A Call-Out Comment Box Appears



Click on call-out button to captureany additional comments.

If you elect to not complete VHCS in one session, pleasesave the results forlater completion.


When you complete all 5 Value Areas, you’re prompted to get your Health Scores

Industry of Customer: Health Care Service Provider: Allied Service, Inc.

Respondent Name: Will Smith Size of Contract ($/Yr): $5M to $25M

Sourcing Scope: Application Dev/Maintenance Contract Start Date: 1/1/2009

Location From: U.S., UK Contract Term (Mos.): 36

Location To: India, Ukraine


VALUEFRAMEWORK

TM

Future Peer Group Scoring



Value Area Summary Scores Are Also Presented


VHCS General Information: PAGE 3 Overview of the VHCS Basic Report PAGE 4 VHCS Overall Results Summary

PAGE 5 Customer Top 10 Value Statements PAGE 6 Customer Bottom 10 Value Statements

PAGE 7 Provider Top 10 Value Statements

PAGE 8 Provider Bottom 10 Value Statements PAGE 9 Customer & Provider Top 5 Not Observed Value Statements

VHCS Detail Data/Information: PAGE 10 Governance Data/Information Section PAGE 11 Governance Statements By Customer Rank Order Scores PAGE 12 Governance Statements By Respondent

PAGE 13 Financial Performance Data/Information Section

PAGE 14 Financial Performance Statements By Customer Rank Order Scores PAGE 15 Financial Performance Statements By Respondent Scores PAGE 16 Capabilities Data/Information Section

PAGE 17 Capabilities Statements By Customer Rank Order Scores PAGE 18 Capabilities Statements By Respondent Scores PAGE 19 Service Quality Data/Information Section

PAGE 20 Service Quality Statements By Customer Rank Order Scores PAGE 21 Service Quality Statements By Respondent Scores

PAGE 22 Risk/Compliance Data/Information Section PAGE 23 Risk/Compliance Statements By Customer Rank Order Scores

PAGE 24 Risk/Compliance Statements By Respondent Scores PAGE 25-31 Customer Respondent Comments PAGE 32-34 VHCS Outsourcing Value Statements (Customer & Provider)

PAGE 35 Optional Facilitated De-Briefing Overview

Use of VHCS Basic Reports: PAGE 36 Sources of Additional Advisory Assistance PAGE 37 Use of the Data, Information and/or Reports Resulting from the VHCS

Health Check Preliminary Report – Table of Contents




(2 VHCS required for a Health Check)

VHCSSurveyPeriod(1 Week)

LaunchVHCS

Health CheckPrelim.Report

1-2 HrReview

•Assign Certified Health Check Advisor•Identify Customer & Provider Health Check Admin. •Sign & Accept Terms of Use Agreement•Complete Health Check Demographics•Complete Health Check Participant Profiler•Prepare Health Check Participants


The Outsourcing Relationship Health Check Process & Value Health Check Survey (VHCS) Help Answer Key Questions

• How can we quickly, effectively and affordably gain a broad understanding of the overall health and additional value obtainable from our relationship on an on-going basis beyond static measures of SLA performance?

• How well are we aligned with our Service Provider(s) on two dimensions (i.e. priority and level of agreement) across the five (5) domains of value in outsourcing, especially as our business environment and needs are constantly changing?

• Are there less important and/or more important areas of value within our relationship where both the customer and service provider can re-prioritize resources thus freeing up resources to deploy to higher valued areas of the relationship?

• How well does the Service Provider(s) understand your value priorities and how well are they able to quickly respond to changes in our strategic agenda?

• Is our Service Provider(s) bringing the expected level of innovation to our outsourcing relationship? If not, why not?

• Are there opportunities for the customer and service provider to better leverage advanced tools and technologies in the delivery of value to the relationship?



XX/XX/XXXX

Health Check Preliminary Report – Summary Page


Leve

l of

Pri

ori

ty

Level of Agreement

HighPriority

LowPriority

BusinessAs Usual

CompletelyDisagree

Neutral orUnsure

CompletelyAgree

SomewhatDisagree

SomewhatHigh

Priority

SomewhatLow

Priority

SomewhatAgree

Value Opportunity Matrix (VOM):Capabilities

Closely Reviewfor Value

Improvement

Key Areas for Potential Value Improvement

Sustain Value & Balance Resources

Harvest &Sustain Value18

7

235 4

6

23

8

5

47

61

With Advisory Assistance - Use of Advanced Tools To Interpret Data/Information


Governance Statements – By Respondent ScoresRespondents Statement 1 Statement 2 Statement 3 Statement 4 Statement 5 Statement 6 Statement 7 Statement 8 Average/Total Scores

Customer Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O

1 5 4 0 3 3 0 4 4 0 4 4 0 4 3 0 4 5 0 4 5 0 3 3 0 3.88 3.88 0

2 6 8 0 4 9 0 7 7 0 7 7 0 3 8 0 7 7 0 10 10 0 6 8 0 6.25 8.00 0

3 6 5 0 4 8 0 4 7 0 3 7 0 2 8 0 2 6 0 10 8 0 5 6 0 4.50 6.88 0

4 4 7 0 1 7 0 7 7 0 2 7 0 2 7 0 5 7 0 10 10 0 4 7 0 4.38 7.38 0

5 6 8 0 6 8 0 7 8 0 7 8 0 2 8 0 7 8 0 7 6 0 8 8 0 6.25 7.75 0

Customer Avg. 5.40 6.40 3.60 7.00 5.80 6.60 4.60 6.60 2.60 6.80 5.00 6.60 8.20 7.80 5.20 6.40 5.05 6.78

Customer Min. 4 4 1 3 4 4 2 4 2 3 2 5 4 5 3 3 2.8 3.9

Customer Max. 6 8 6 9 7 8 7 8 4 8 7 8 10 10 8 8 6.9 8.4

Respondents Statement 1 Statement 2 Statement 3 Statement 4 Statement 5 Statement 6 Statement 7 Statement 8 Average/Total Scores

Provider Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O Agreement Priority N/O

A 3 7 0 3 7 0 5 7 0 7 8 0 8 3 0 4 7 0 5 7 0 7 3 0 5.25 6.13 0

B 7 6 0 6 6 0 7 5 0 7 7 0 6 6 0 5 5 0 7 5 0 6 5 0 6.38 5.63 0

C 7 4 0 6 4 0 3 6 0 7 4 0 6 4 0 6 6 0 8 8 0 6 6 0 6.13 5.25 0

D 3 3 0 8 3 0 5 3 0 8 8 0 3 3 0 3 3 0 8 8 0 3 8 0 5.13 4.88 0

Provider Avg. 5.00 5.00 5.75 5.00 5.00 5.25 7.25 6.75 5.75 4.00 4.50 5.25 7.00 7.00 5.50 5.50 5.72 5.47

Provider Min. 3 3 3 3 3 3 7 4 3 3 3 3 5 5 3 3 3.8 3.4

Provider Max. 7 7 8 7 7 7 8 8 8 6 6 7 8 8 7 8 7.4 7.3

Group Avg. 5.20 5.70 4.68 6.00 5.40 5.93 5.93 6.68 4.18 5.40 4.75 5.93 7.60 7.40 5.35 5.95 5.38 6.12

GAP 0.40 1.40 2.15 2.00 0.80 1.35 2.65 0.15 3.15 2.80 0.50 1.35 1.20 0.80 0.30 0.90 0.67 1.31

Individual Identity Protected Healthy Areas Areas of Potential Interest

Potential Mis-Alignment Areas


Leadership Pairs Effectiveness Assessment


“Leadership Pairs that are successful

become quickly self-sustaining”


What Are Health Check Advisory Services?• Health Check Advisory Services is a low cost and risk free support service included

with every Outsourcing Relationship Health Check.

• Health Check Advisors have on average over 20 years of outsourcing/shared service center experience with such firms as IBM, PwC, E&Y, CSC, Cap Gemini, E&Y, Tata Consulting and other leading organizations. They are fully trained, certified and have working experience with all aspects of the standardized Outsourcing Relationship Health Check process and supporting tools:

• The Health Check Advisor’s role is to prepare your team, facilitate the process, analyze and report on the results of the survey and share contemporary insights gained from other Health Checks performed around the globe. Their role is designed to reduce the time, energy and overall investment required by both the customer and service provider while delivering tangible and intangible results with minimum disruption to business operations.

• Our objective is to develop Health Check leadership skills in customer, service provider and advisory teams so that organizations can independently use the Outsourcing Relationship Health Check process and tools as appropriate.



Intangible = Improved Alignment on Priorities, Expectations & Results!

SomeComments:

$ Tangible = 5% to 30%+ of the annual contracted spend!

“Confirmed a lot of what we felt but couldn’t put our finger on.”

“ROI is off the charts…doing a Health Check makes a lot of CENTS!”

“Process is intuitive and easy to leverage for continued internal use.”

“Opened our eyes to areas of value we hadn’t considered before.”

What’s The Potential Business Impact &/or Value

of Performing an Outsourcing Relationship Health Check?


Phase 3 – Refresh(4-12 Weeks)

Advisory Assistance is Optional in Phase 3



Phase 2 – Analyze(2-3 Weeks)

Use Value Opportunity Matrix (VOM) &Leadership Pairs Effectiveness Assessment

What’s the Cost to Perform an Outsourcing Relationship Health Check?


Corporate Customer & Service Provider/Advisor Members get a 50% Discount off 1st Health Check/Yr.

Customer & Service Provider can “Opt-Out” of Advisory Assistance if their

Administrators have had prior experience as a Health Check Administrators or they’re a COP and attend the COP Health Check Administrator Workshop.

Phase 1 - Assess - Costs To Use VHCS ToolQTY of VHCS

Acquired in Bulk

Purchase

Non-Members

of IAOP

IAOP Corporate Advisor

Member & Individual

Professional Members

IAOP Corporate

Customer & Provider

Members ONLY

From 1-2 $2,500 $2,250 $2,000

From 3-5 $2,000 $1,800 $1,500

From 6-15 $1,750 $1,575 $1,250

From 16-50 $1,500 $1,350 $1,000

From 51+ $1,000 $900 $500

1.) Two (2) VHCS are required to perform a full 360 degree Outsourcing Relationship Health Check

2.) Each VHCS has an 18 month use period from date of purchase

3.) VHCS may be donated to a third party for use during the use period with prior IAOP/GSOS approval

4.) Unused or expired VHCS have no cash value.

Two (2) VHCS = $4,000 x 50% Corporate Discount = $2,000

Total Cost for 1st Health Check for IAOP Corporate Customer Members = $7,000

…Plus…Advisory Services Fee = $10,000 x 50% Corporate Discount = $5,000

Phase 1 & 2 - Cost of Health Check Advisory AssistanceTotal # of Stakeholders, i.e.

Participants in Health Check

*Fixed Fee for

Advisory Assistance

IAOP Corporate

Member Discount % *Net Fee (USD)

Up to 10 Participants $10,000 50% $5,000

Each Additional Participant $200 50% $100

Leadership Pairs Assessment Complimentary Optional to Perform $0

*Advisory Assistance Fees in U.S. and Canada are USD. Fees may vary worldwide based on location.


Are you an IAOP Corporate Customer Member?

Yes

No

Contact Matt Shocklee at [email protected] to schedule yourOutsourcing Relationship Health Check:

3. Deliver the Preliminary Health Check Report

1. Contact your Service Provider, Sign Agreement & Provide Information,

4. Launch Phases 2 & 3 of the VHCS Relationship Health Check Process

2. Launch the Value Health Check Survey period, (1 week)



2. Launch the Value Health Check Survey period (1 week)

3. Deliver the Preliminary Health Check Report

1. Contact Your Service Provider, Sign Agreement & Provide Information,

4. Launch Phases 2 & 3 of the VHCS Relationship Health Check Process

Are you an IAOP Corporate Customer Member?

Yes

No

Contact Matt Shocklee at [email protected]

0. Get started by acquiring 2 VHCS for $5K or Join IAOP as a Corporate Customer Member for $5K (current 20% discount to join through July 2014)



Want to Learn More About Enlighta? Contact Matt Shocklee at: [email protected]

Value Health Check Survey (VHCS) Powered by enlighta!



VALUEFRAMEWORK

TM

Launch Your Outsourcing Relationship Health Check [email protected]

Questions Anyone?

Презентация ioap. Бизнес-клуб "АСТРА".Общие центры...

Business

rights reserved17

global outsourcing industry

theoverall health

outsourcing lifecycle

health check process

business value

improvingthe value

service providershare