Managed Services Balanced Scorecard

Managed Services / RelationshipBalanced Scorecard : 

Managed Services / RelationshipBalanced Scorecard

Speakers : 

Speakers Ratish Pandya MS from Penn State University, PMP Certified professional with 10+yrs or IT experience 3.5+ years experience in leading Sourcing engagements. Focus area includes End to end Vendor selection (ADM/BPO) Transition governance Governance setup & sustain (VMO/PMO) Functional expert on VMO and Balanced Score Card Kapil Sanghi B.Com, M.E.P. from IIM (A), 10 years work experience in software industry Specializes in leading BPO engagements Functional expert on VMO and Balanced Score Card Mike Wind Director, IT with Collective Brands Inc (was earlier Director, IT Applications from 2007) Director, Consulting Services at Hackett Group for 2 years Director, IT at Michaels Stores, Inc for 3 years Florida State University

Systems Plus Solutions – Background : 

Systems Plus Solutions – Background 20 years of transforming global enterprises using Technology Experience in 20+ countries, multi-lingual, multi time zone environment Team of 300+ resources and growing ISO Certified Processes (ISO 9001:2008) Key practice areas: Sourcing Advisory (services rendered under “Sourcing Gurus” brand) Technology Solutions Oracle E-Business Support & Helpdesk

Client - Collective Brands Inc : 

Client - Collective Brands Inc Collective Brands, Inc. is a leader in bringing compelling lifestyle, fashion and performance brands for footwear and related accessories to consumers worldwide. Collective Brands is the operating company for Payless ShoeSource, Stride Rite Corporation and Collective Licensing International Collective Brands Inc. now ranks as the largest non-athletic footwear company in the Western Hemisphere $ 3.4 Bn No of Stores 4,877 Revenue Data for 2008

Overseeing Managed Services: Challenge : 

Challenge: “Organizations are strained to ‘Effectively Oversee Outsourcing and Managed Services’”* Data and metrics provided by vendors is: Overwhelming Provides little structure and/or relationship to the organization’s goals and objectives Only generally focuses on the delivery status Lack of performance or ineffectiveness is difficult to diagnose Relationship governance is always underestimated and tends to be an afterthought Lack of governance makes vendor relationships subjective and adversarial * 2008 Black Book of Outsourcing – State of Industry Report Overseeing Managed Services: Challenge

Overseeing Managed Services: Solution : 

Overseeing Managed Services: Solution Solution: The Balanced Scorecard approach measures and articulates the value of Managed Services A framework encompassing all the elements of the relationship Financial, Delivery, Customer Satisfaction, and Resource Productivity A clear line of sight between objectives and the critical Managed Services delivery items A tool for communicating status and results A quantitative and qualitative view of the relationship health

The Balanced Scorecard for Managed Services : 

The Balanced Scorecard for Managed Services A framework encompassing all elements of the relationship Financial Perspective Profitability Price Shareholder Value Customer Perspective Service Quality Internal Perspective Learning and Growth New Skills Continuous Improvement Intellectual Assets “If we succeed, how will we look to our shareholders?” “To achieve our vision, what customer needs must we serve?” “To satisfy our customers and shareholders, at which business processes must we excel?” “To excel in our processes, what must our organization learn?” Cycle Time Productivity Cost Standard Balanced Scorecard Themes Managed Services Balanced Scorecard

The Balanced Scorecard for Managed Services : 

A clear line of sight between objectives and Managed Services delivery The Balanced Scorecard for Managed Services The Scorecard is a drill down from Themes to Objectives to Metrics

The Balanced Scorecard for Managed Services : 

A tool for communicating status and results The Balanced Scorecard for Managed Services The Measures will comprise of the applicable Metrics

The Balanced Scorecard for Managed Services : 

The Balanced Scorecard for Managed Services A quantitative and qualitative view of the relationship health The tool provides ability to add comments and analysis at each step

The Balanced Scorecard for Managed Services : 

The Balanced Scorecard for Managed Services A quantitative and qualitative view of the relationship health The tool provides ability to add comments and analysis at each step

Value of the Managed Services Scorecard : 

Value of the Managed Services Scorecard Value for the Client: Consistent method of reporting for all providers A historical record, in a database, for you and your team to access A central repository for your team to input analysis at every Measures that are agreed upon with emphasis on the appropriate metrics Providers don’t offer reporting to capture other areas The ability to measure without significant increase in internal costs (Potential) Value for the provider Makes the governance less subjective The opportunity to evaluate the maturity of the client’s internal processes Mechanism to report the data / status of their services

Benefits of the Managed Services Scorecard : 

Benefits of the Managed Services Scorecard Return examples for the Client: The client and provider can save on investing in governance effort: Time savings on monthly governance…soft As much as 50% reduction in time spend on governance material preparation Time re-focused on relationship management and driving value from the model Measuring the relationship will provide hard savings re-investment opportunities: Value-add services from the provider…hard Services performed to evaluate initiatives in the strategic portfolio Services performed to maximize productivity and increase performance of the systems Maximizing On/Off-Shore Ratio, Blended-Rate…hard Improvements in contract types…hard Maximize the amount of capacity and services in a multi-year core contract Minimize the amount of Capacity Leakage / non-utilized hours in a hours-based contract

The Balanced Scorecard for Managed Services : 

Software-as-a-Service (Saas) Offering Sharepoint / .Net tool Hosted site with client domain (“sourcinggurus.<clientname>.com”) Includes pre-linked Themes, Objectives, Measures Includes resources to load data at regular / defined rhythms Includes a yearly setup (weights, tolerances, and objectives) Additional Offerings / Services Resource time for metric analysis More frequent updates of weights, tolerances, and objectives (quarterly, semi-annually) Additional “tracking” metrics and linked metrics Process maturity analysis based on ITIL The Balanced Scorecard for Managed Services

Appendix : 

Appendix

Appendix - What Comprises Scorecard : 

Objectives Measures Themes Organization’s Goals Gives Visibility To Categorized Into Comprised Of Appendix - What Comprises Scorecard Stated and Weighted As

Appendix - Setting Up the Scorecard : 

Objectives Measures 2. Themes 1. Goals of the CIO Gives Visibility To Categorized Into Comprised Of Appendix - Setting Up the Scorecard Stated and Weighted As CIO (IT) Objectives (and/or) Survey Answers The CIO’s Corporate Objectives can be utilized A series of interviews will be used to determine other goals of the IT organization Categorize Extract 1. Goals of the CIO 2. Themes

Appendix - Setting Up the Scorecard : 

3. Objectives / Weights 4. Measures 2. Themes 1. Goals of the CIO Gives Visibility To Categorized Into Comprised Of Stated and Weighted As 3. Weightings 4. Measures Weightings Measures Appendix - Setting Up the Scorecard 3. Objectives

Appendix – Using the Scorecard : 

Financial Data Budget Actual Forecast Support Delivery Number Delivery Resolution Customer Data C-Sat Scores Value-Add Services Governance Participation Project Delivery Schedule Milestones Deliverables Financial Data Hours Skill / Rate Card Attrition / Turnover Customer Survey Tool(s) PMO Tool Resource Tracking Tool Financial System Ticket Tracking System Analysis Entered on regular rhythms (M, Q, Y) Entered by off-shore team Updated / Approved by VMO Setup Occurs at start of engagement Includes objectives, weights, measures, and tolerances Can be at regular intervals (Q, Y) Manually Load Data into Tool (M, Q, Y) Appendix – Using the Scorecard

Slide 20: 

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