it outsourcing trends - 2016 and beyond
TRANSCRIPT
IT Outsourcing Trends
2015 & beyond
1. Worldwide IT Outsourcing market
2. Digitalization puts pressure on all organizations
3. Business leads technology
4. Large contract renegotiation
5. New working & pricing models
6. Flexible sourcing models
7. Project management trends
8. Co-opetition between IT service providers
9. Focus on risk
10. Employment strategies
11. New technology trends
Agenda
WORLDWIDE IT OUTSOURCING
$100 BILLIONworth of outsourcing contracts will be
renegotiated in the following year, according to Stanton Jones.
Number of outsourcer per company will
multiply even further
Organizations want in on the cloudMore than half of all UK organizations are using, or planning to use, public cloud
vendors. The satisfaction with these cloud vendors, such as Amazon, Google, Microsoft, Oracle, Rackspace, Salesforce.com and SAP is generally high
Focus on core business is the main driver for outsourcingWhen asked for the main drivers of employing ITO services, 68% of the respondents cited a
need for their companies to focus on core businesses. Organizations looking to outsource more this year are also returning to investing to support the business, after sweating existing
assets during the economic downturn in the late 2000s.
Cloud, utility computing, and virtualization will
converge, and everything will start to
look the same
Businesses will continue to outsource…The market of outsourcing companies is expected to grow. In UK for example 69% of respondents in a
survey say they will continue to outsource at the same rate or even more.
MORE EXPECTATIONS
Digitalization is transforming organizations, putting pressure on organizations to adapt. As a consequence they will replace reactive service providers that lack innovation and business understanding with strategic technology partners that are able to deliver deep
technology driven innovation
BUSINESS LEADS TECHNOLOGY
Technology will be purchased more and more by business leaders rather than IT departments.
Organizations will migrate to a service brokerage model, focusing on rationalization, integration and security
LARGE CONTRACTS RENEGOTIATION
Many customers will replace traditional outsourcing with multisourcing, cloud-based
models
PROCUREMENT PROCESS
The traditional RFP fades in front of emerging procurement methods as it takes too long to define specifications & it
costs too much. Business requirements change and it takes a collaborative approach to identify needs and proactively
define specifications
NEW WORKING MODELS
Labor as a Service
NEW PRICING MODELS
Business outcome based pricing, pricing based on performance
HYBRID OUTSOURCING
Offshoring is no longer the default. A hybrid model that leverages onsite, onshore, nearshore and offshore
tends to be acknowledged as the best sourcing strategy
OUTSOURCING PARTNERS
Managing service providers, due to increasing application focus and the commoditization of infrastructure, will take on characteristics that we see in software portfolio management today -- elimination of duplicated and unused services, allowing for growth, negotiating and negotiating again (…) Integration will be absolutely critical and is likely to be the key differentiator between one organization's IT effectiveness and another's.”
Scott Fueless, principal consultant with ISG
Large deals will disaggregate in smaller ones for more transparency & control and small projects might be aggregated into complex, enterprise wide solutions for better project governance & to achieve business goals. Outsourcers per customers will multiply
even further, making project governance a complex task
”
OUTSOURCING CO-OPETITION
Multi-sourcing strategies will oblige competing service providers to work together to achieve common business
goals. Various organizations already implemented “outsourcing cooperation agreements” that bind service
providers to cooperate at operational level
DATA-DRIVEN OUTSOURCING
Enterprises will choose IT services partners based on cost, project transparency & data to understand
optimization opportunities
DOMESTIC SOURCING & INSOURCING
Domestic sourcing & insourcing will remain in the game, sometimes brought back, especially for projects that require senior, experienced teams, agility, cultural
alignment & local business understanding
PROJECT GOVERNANCE
The growing complexity & diversity of service providers ecosystem transformed project governance into a critical
capability, enabling organizations to manage performance, risk and compliance
PROJECT MANAGEMENT
The day of project management amateurs is over, organizations are struggling to attract entrepreneurial Project Managers.
Projects get more complex therefore PMs need to become masters in coordinating various tasks, teams and sources.
• crowdsourcing (eg: Wazoku Idea Spotlight)• big data (for cost projections or hidden correlations)• methodologies adapted to project scope (high focus on agile)• dedicated collaboration tools/central project hubs (eg: Slack, Yammer,
Salesforce Chatter, Flowdock) gain grounds in front of the traditional emails
• gamification (rewards & points to make boring tasks more enjoyable
INTERNAL SERVICE INTEGRATION COMPETENCIES
The increasing complexity of the multi-sourced environments makes internal service integration
competencies strategic. This enables organizations to keep control, make sure all services are compliant and select easier niche service providers for future needs
FOCUS ON RISK
Integrating supplier risk into business operations Business decisions based on different real-time risk events
FOCUS ON RISK
Geopolitical risks are asserted – caution about countries with political and economic turmoil to avoid disruptions
EMPLOYMENT STRATEGIES
IT service providers will increasingly use gamification to keep employees engaged during the performance of
routine and monotonous tasks
EMPLOYMENT STRATEGIES
BYOD / Work from homeSecurity challenges & strategies
EMPLOYMENT STRATEGIES
Strategic focus on HR strategies, recruitment, talent retention & talent pool creation, SDC &
certification programs;Recruiters need to enter the marketing game
NEW FORMS OF SOCIAL INTERACTION
Communities (online and offline) will form around products and solutions, being the source of new ideas
that develop the product, and a way to recruit new employees.
Forum
CLOUD COMPUTING
As the industry becomes more and more comfortable working with the cloud, the industry is becoming even more comfortable with the benefits of standardization -- increased efficiency, virtualization, reduced support costs. Thus, even in bespoke outsourcing arrangements, there may well be more similarity than difference, both within a single company's formerly complicated IT environment, and across companies --both client and provider. The cloud, utility computing, and virtualization are converging to create this new operating model that will become the new paradigm for IT outsourcing.
Joshua'Konvisser,'Pillsbury'Winthrop'Shaw'Pittman
”
Cloud comes down to earth
SMART MACHINES MOVING UP THE VALUE CHAIN
As artificial intelligence evolves, development and implementation of robot like technologies will be used to automate tasks and processes currently performed manually in house or through outsourcing partners
• We'offer'discrete'solutions'to'known'business'challenges'and'build'bespoke'solutions'for'your'specific'requirements.
• Our'delivery'models'encompass'the'full'range'of'development'options'and'our'ability'to'engage'from'nearshore'with'UK'presence,'as'required,'gives'you'full'control'over'costs.
• We'offer'a'refreshing'approach'to'commercials,'enabled'by'our'unique'structure.
• Our'final'building'block'to'deliver'the'right'business'solutions'for'you'is'in'depth'knowledge'of'your'industry'sector.'This'means'we'talk'your' language'and'understand'the'business'impact'of'our' solution.''''
Banking Insurance
HourlyT&M
ApplicationDevelopment
.NET, Java,?PHP/LAMP,?C/C++Amazon,Windows?Azure, SalesforceIos, Android,Windows?Phone,?Blackberry,?HTML5
Ruby?onRails, Python,?EmbeddedSoftware,Databases, Sharepoint,?SAP,Microsoft, Oracle,Other Technologies
ApplicationTesting
ApplicationSupport
ITConsultancy
ProjectManagement
BusinessAnalysis
Fixed Price
Nearshore
Agile
System Integration
Information Security
EnterpriseMobility
WebApplications
CRM?&Loyalty
MobileApplications
BusinessIntelligence
Cloud Strategy
eCommerce?Development
CloudMigration
Big?DataConsultancy
Big?Data?Dashboards
Iterative Waterfall Prototyping
Onshore Combined
SLA?driven TeamAugmentation
DedicatedTeam
Leasing ITC Retail eCommerce Travel Healthcare Media
B U S I N E S S S O L U T I O N SIndustryExpertise
CommercialModels
EngagementModels
DeliveryModels
DiscreteSolutions
CoreTechnologies
CoreServices
• Our'client'list,'representing'key'industry' sectors,'reflects'Euro'IT'Groups’'ability'to'deliver'high'quality,'on'time,'services'to'organisations from'worldwide'recognised brands'through' to'innovative'startups.'Euro'IT'Groups'adaptability,'based'on'repeatable'processes,'is'just'one'of'the'reasons'these'organisations choose'us'as'their'IT'specialists.
• Each'of'these'clients'can'be'referenced'and'our'specific'engagements'with'them'are'captured'as'Case'Studies.''
• These'clients'and'our'successful'engagements'are'the'reason'why'we'can'be'confident'we’re'the'right'choice'as'your' IT'specialist.
CLIENTS
Banking,Financial&'Leasing
Travel'&'Accomodation
ITC STARTUPS BPO OTHERS Retail'&'Wholesale
eCommerce Insurance Healthcare
Our*Clients
Banking,Financial&'Leasing
Travel'&'Accomodation
ITC STARTUPS BPO
OTHERS Retail'&'Wholesale eCommerce Insurance Healthcare
Our*Clients
TECHNOLOGY• Euro'IT'Group’s'unique'structure'means'we'have'access'to'every' IT'application'technology'you'may'
require,'from'traditional'technologies'in'the'Java'and'.Net space'to'leading'edge'technologies'driving'innovation' in'areas'such'as'Big'Data,'business'intelligence'and'Mobile'.
• Maintaining'up'to'date'skills'in'such'a'wide'variety'of'technologies'is'practically'impossible'for'an'in'house'team'and'traditional'vendors'are'constrained'by'their'structure'and'existing'teams.
• By'taking'a'refreshing'approach' to'our'organisations,'Euro'IT'Group'can'confidently'engage'you,'the'client,'from'the'starting'point'of'being'technology'agnostic.'We'will'work'with'you' to'understand'your'problems,'challenges'and'requirements'and'only' then'agree'what'technology'solution'is'right'for'you.
• The'technologies'on'the'right'reflect'our'current' skills,'but'we'will'constantly'enhance'this'to'take'advantage'of'new'technologies'entering'the'market.
TECHNOLOGY
PARTNERSHIPS
Why*us
Proven'track'record'in'delivering'complex'projects
We'offer'a'well'balanced'blend'of'technology'skills,'domain'knowledge,'hands'on'experience,' effective'methodologies,' complex'language'skills'and'a'great'passion'for'converting'business' ideas'into'technical' products
Western'business'culture,'excellent'English'language'skills,'French,'German,'Italian,'Hungarian'speaking'resources
Convenient'locations'and'favorable'time'zones
Proof'of'capability'based'on'low'cost'pilot'projects
Capability'for'fast'project'initiation'and'delivery
Well'defined'and'documented' software'development'process
High'focus'on'staff'trainings,'employee' satisfaction'and'an'effective' recruitment'process'– stable'qualified'teams
