sap managed services survey_whitepaper.pdf

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In summary, the reader is

encouraged to consider the evi-

dence from the survey results

and to then draw their own conclu-

sions. As Birchman is a provider of

SAP Managed Services, we havesupplied the facts with opinions but

have avoided writing a conclusion

which may be deemed biased.

This article explores the findings by

looking at the:

Service areas respondents consid-

ered were most important

Service areas that respondents most-

ly deliver in-house

Service areas that respondents have

mostly outsourced

Service areas that are meeting or that

are failing to meet expectations

Service areas respondentsconsidered were most impor-tantThe following four service areas were

rated by respondents as being the

most important elements of SAP sup-

port. In order of importance, they are:

Response Times

Technical Expertise

Value for Money

Functional Expertise

For all areas of service we asked

whether expectations were being met.

The choices were:

Expectations are not being met

Expectations are generally being

met

Expectations are being met

The following analysis is only based on

responses categorised as Expecta-

tions are being met as Expectations

are generally being met is not good

enough in our view.

If we explore Response Times first

(see Figure One), it would appear

service recipients expectations are

best satisfied when:

Help Desk is outsourced

Hosting is outsourced

In terms of Technical Expertise (see

Figure Two), it would appear that

expectations are best being met when:

BASIS support is in-house

Systems Admin is outsourced (see

Figure Two)

In terms of Value for Money, it would

appear there is little difference

between in-house or outsourced. Fig-

ure Three shows essentially the same

distribution of responses for in-house

versus companies that outsource at

least one service.

b i r c hman news

SAP Managed Services Survey:

In-house vs Outsourced

During Q2, 2010 The Birchman Group carried out a survey in the UKfocused on SAP Support and Managed Services. In this article themaindifferences between in-house vs outsourced services are explored.

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M A N A G E D S E R V I C E S

In-house,

meeting expectation

Outsourced,meeting expectation

23%

67%

In-house,meeting expectation


24%

40%

Figure 1: Response times, base on whether Help Desk / Hosting is in-house or outsourced

Figure 2: Technical expertise, based on whether BASIS / System Adminis in-house or outsourced


Outsourced,

meeting expectation

41%

22%


Outsourced,

meeting expectation

33%40%

In terms of value

for money, thereis little differencebetween inhouseor outsourced

Not meetingexpectation

Generallymeeting

expectation

Meetingexpectation

All in-house

At least one service outsourced

22%19%

56%63%

22% 19%

Figure 3: Value for money


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In terms of Functional Expertise, service

recipients expectations are best satis-

fied when services are provided in-

house (see Figure Four):

Birchman opinion:

The responses which surprised us

most were that in-house teams

exceeded the expectation of out-

sourced teams in both Technical

and Functional Expertise. In our

experience we would expect out-

sourced service providers to

exhibit stronger Technical and

Functional Expertise due to serv-

icing multiple clients thus provid-

ing a broader experience base;

and the continual training and

development focus of dedicated

outsource providers. Logically thiswould enhance the experience

and skills base of external

pr ov ider s over th ei r in -h ou se

counterparts.

We would expect there to be gen-

eral agreement to the Response

Time findings, that outsourced

providers outperfo rm in-house

teams, as external providers often

have financial penalties in their

contracts whereas it is difficult to

gain that level of carrot and stick

focus with an internal team.

Birchman prides itself on develop-

ing a close relationship with clients

and understanding their underlyingbusiness and processes. This is

made easier as our SAP Managed

Services are primarily on-shore

with the ability to be on-site as

required. However our view is that

across the industry as a whole out-

source service providers should be

outperforming in-house teams in

terms of Functional and Technical

expertise.

For interest, the areas which were rated

least important by respondents were:

The provision of remote support off-

shore

The provision of mixed support teams

with some on-site, on-shore and off-

shore

Ability to vary service to reflect sea-

sonality or critical periods in your

business

ITIL compliance

Service areas that respondentsmostly deliver in-houseThe survey suggested that the following

service areas were mostly delivered in-

house:

Help desk

System Admin

Hosting

Figure Five indicates the levels of happi-

ness with the in-house arrangements

and whether outsourcing is being consid-

ered.

Service areas that respondentshave mostly outsourcedOur survey found that the most com-

monly outsourced service areas were:

Enhancements and Projects

BASIS support

ABAP support

Figure Six indicates the level of satisfac-

tion with the outsourced arrangements,

and whether bringing these services in-

house is being considered.

Birchman opinion:

We were generally surprised that so

many companies host in-house and

that so few are looking to outsource.

We see this as an area of change

over forthcoming years - driven by

cloud computing and SAP OnDe-

mand.

We are also generally surprised with

the lower score for outsourced

Enhancements and Projects. This is

probably also linked to the Function-

al Expertise findings. Anecdotally,

SAP has the reputation as being slow

and difficult to amend to meet the

needs of ever and fast changing

business requirements. However

SAP has evolved in this area and it is

in the interests of SAP, service

providers and in-house IT groups to

change this reputation.

Birchman prides itselfon developing a closerelationship withclients and unders-tanding their busi-ness and processes

5b i r c hman news

M A N A G E D S E R V I C E S



55%

33%



62%

38%

Help desk

Happy within-house

Consideringoutsourcing

95,5%

5%

System Admin

Happy within-house

Consideringoutsourcing

86%

14%

Hosting

Happy with

in-house

Considering

outsourcing

95%

5%

Enhancements

and Projects

Happy with

in-house

Considering

bringing backoutsourcing

62%38%

ABAP

Happy with

in-house

Considering


100%

0%

BASIS

Happy with

in-house

Considering


89%

11%

Figure 5: Levels of happiness with in-house arrangements and whetheroutsourcing is being considered

Figure 6: Level of satisfaction with the outsourced arrangements, and whether bringingthese services in-house is being considered

Figure 4: Functional expertise when Application Support / Enhancements and Projects aremanaged in-house vs outsourced


3/3b i r c hman news

Service areas that are meeting or not

meeting expectations

The service area that respondents were

most satisfied with was Language. As

expected in-house teams overall scored

higher from a language perspective than

outsourced providers interestingly,

however, we found a higher proportion

of respondents were satisfied with lan-

guage when their Help Desk was out-

sourced (see Figure Seven).

In terms of service areas where satis-

faction ratings were the lowest, Theability to continuously improve was the

worst. If we look at Application Support

and Enhancements / Projects, the find-

ings are more or less evenly split

between in-house and outsourced (see

Figure Eight).

Birchman opinion:

We were surprised that the survey

indicated that Language expecta-

tions were more often met when

Help Desk is outsourced. This is an

area of customer dissatisfaction

often cited in the press. It might

just be that language is generally

becoming less of an issue.

Disappointingly, Ability to Continu-

ously Improve is the service area

with which respondents were least

happy with. Internal and external

teams need to put the processes in

place and allow for time during cus-

tomer account management to

focus more on continuous improve-

ment.

Before bringing this article to a close, it

is useful to provide some further context

regarding in-house vs outsourced serv-

ice provision. Figure Nine shows the %

of companies that outsource at least one

service area.

Birchman opinion:

In terms of sample size the smaller

the turnover the lower number of

companies that responded. The

fact there are any companies with

turnover less than

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