IT Outsourcing Transformation Demand of the time

IT Outsourcing Transformation Demand of the time

2 Overview IT Services have been an in-house function for most of organizations across the globe a decade ago. With rapid growth in new technologies and expansion of customer base, organizations were unable to adapt to changes relying solely on their in-house IT teams. This gave rise to external IT service providers and proliferation of multiple engagement models. In-House IT Team Organizations were using in-house IT teams to manage the IT work. Co-Sourcing Model - Organizations started using consultants from the service providers to manage the work along with the In-house IT team. Service provider s consultants were managed by the IT manager. Staff Augmentation (T&M) Model Organizations use IT service providers to complement the in-house IT teams in execution of projects and pricing model was based on the effort put by the consultant. Fixed Price Model Fixed price model is similar to Staff Augmentation model in terms of tasks being outsourced to the service provider. Pricing model is different from Staff Augmentation. In Fixed price model, cost of service is measured in terms of quantity of deliverables and overall program is managed by the organization. Managed Services Model In Managed services engagement model, the service provider is responsible for end-to-end responsibility to deliver a service which was being delivered or managed by the organization s in-house IT department. Pricing model is outcome based as compared to activity based in the earlier models. Figure 1: In-House IT Vs Co-Sourcing Vs Managed Definition A managed service is the practice of transferring day-to-day management and operations responsibility to a third party service provider, as a strategic method for improving effectiveness and efficiency.

3 efficiency.while the organization that owns or has direct oversight of the entity or system being managed is referred to as the client or customer, the person or organization that accepts and provides the managed service is regarded as the service provider. Concept The service managed and delivered by a service provider under a contracted service level agreement is generally termed as a Managed Service. This term is used by various providers differently based on the context of their business and the services that they provide. The service provider takes complete management responsibility to deliver a service that was traditionally performed by the internal staff or by the service providers in either T&M or Fixed price model. Managed services are definitely not a one-size-fits-all concept. They have to be customized based on the unique needs of the organization and the service provider s portfolio of services. In a managed services scenario the customer organization compensates the service provider for the services that it provides and not for the components that constitute the service. The customer organization is not required to plan, design, manage, and deliver the services in a managed services scenario, as all these activities that are related to service delivery and operations management are the responsibility of the service provider. While working with an organization that has a highly matured managed services setup the customer is required to only manage, monitor and evaluate the overall service provider performance. Scope The diagram shown below depicts the scope of the Managed services Portfolio starting from mere Team augmentation to the level of complete outsourcing of all Assets (Hosting & IT), planning, designing through an SLA based end-to-end service management. The scope in Model-4 gets extended up to managing other service providers for a defined scope of work. It also includes driving RFP and selecting the final service provider to provide the service. Figure 2: Levels of Outsourcing

4 The Needs There are several drivers for a managed services set up depending on the organization, the industry it is operating in, the applications/systems that it uses, service provider penetration, and the IT industry outlook. They range from reducing delivery risk to leveraging the service provider s capabilities for service delivery. CIOs are facing the challenges of IT Managers spending time in micro management of individual projects Managing financial pressure of high cost of operation and inadequate year-on-year improvement Fierce competition Handling all business and technology risk CTO, SMEs and IT Managers spending the precious time in finding the ways of application modernization and lack of support from the service provider Having roadblocks in adopting mission critical technology and going for business transformation Inadequate Value addition by the service providers. Lack of transparency from the service provider. Service Providers also face the problem of Lack of Visibility Lack of Ownership Non involvement in planning activity and execution as per the plan No focus on the productivity improvement and competency enhancement. Inadequate opportunity of moving up in value chain during the engagement. These challenges are mainly because of the reasons illustrated below. Multi Vendor Scenario Customers are working with multiple service providers and tracking each and every service provider is a cumbersome task. While working in Co-souring model, service provider lacks in demonstrating the - Accountability Customer is accountable for any issue even if services are offered by the service providers. Capability enhancement Service Provider s consultant sticks to a technology and the application without any capability enhancement in technology or business applications. Productivity Improvement Supplier s consultant does not work in the line of productivity improvement to deliver more for less. Innovation There is a lack of innovation by the service provider s consultants when they don t get opportunity to define, execute, deliver and measure their performance. Scalability Scalability becomes an issues when planning is done

5 by somebody and execution by somebody else. In case of In-house IT team also, scalability is an issue to address. Visibility Service provider does not have the visibility of the complete landscape and it impacts the performance of service provider. Partnership Service provider does not work in partnership mode to bring maturity into the business. Outsourcing in Managed Services - Benefits IT Industry has seen tremendous benefits by transforming the engagements into Managed Services. In a matured managed services engagement model, customer gets benefits not only in making a better strategy for the coming years but also gets cost effective and quality services from the service provider in partnership mode. Few key benefits are - Risk, Responsibility and Rewards sharing by the trusted partners Predictable costing Innovative solution framework SLA Based Delivery - Driving Efficiency through Service Level Management Customer FTEs are freed up to take-up other important activities Clearly stated, measurable outcomes Accountability is built into the model so that roles and responsibilities are strictly defined and ambiguity eliminated wherever possible with Quantitative metrics and milestones. Consistent High Quality Delivery Continuous improvement - Simple staff augmentation does not provide the incentive for process improvement. The managed outcome model, by comparison, encourages the provider to exploit savings opportunities through shared knowledge of best process practices, standardization, and application life-cycle improvements Development of Reusable components Access to Experts, Enterprise Tools and World-Class Methodologies Improved efficiency and productivity Knowledge Retention Reduced Total Cost of Operations Improved Customer Satisfaction Transformation to Managed Services Purpose This document provides a methodology for transforming staff augmentation model to managed services model. It contains detailed

6 process for identifying and prioritizing the applications / projects / services for managed services model and then how to start the managed services engagement. Prioritization is done based on the weight assigned against numerous parameters. The methodology explains the following Facilitates the service provider to develop and submit the business case. Helps the customer in defining the road map for transitioning to Managed Services Model. How to define and establish Service Level Agreements for different types of services. Embracing Managed Services Model will benefit the customer in terms of cost optimization, process maturity and improved quality. Customers get all the advantages of a matured outsourcing model in managed services mode. Approach towards Managed Services Model Managed Services Framework is typically designed with the following key objectives- Enable transition to Managed Services in a phased manner Provide a standardized service model Reduce client effort s on operational management Extend benefits from economies of scale Will provide IT Managers necessary job aids, guidelines, templates and checklists to enable transition into the framework The process any established service provider would like to follow the approach is represented below (while working with Customer counterparts)- Prepare Application Services Catalog Prepare exhaustive list of services provided for each application Categorize these services for each application in to various application management services (AMS) category Prepare a volume baseline per application per service Categorize Applications Applications are categorized (Platinum, Gold, Silver etc) based on the business criticality Document As-Is Processes for each of the AMS Categories in the following lines Incident Management, Problem Management, Change Management Service Request Management Configuration, Release and Availability Management Collect Service Level Requirements based on business criticality Define SLAs based on Service Level Requirements

7 Based on the analysis, a roadmap is prepared to transition services from the existing setup to service provider s Managed Services model. The Elements Figure 3: Managed IT Operations Services There is a need for establishing strong practices both on the customer and service provider front to move into a managed services setup. Moving into this setup calls for putting in place a framework that governs the organization and its service providers and certain operational practices that need to be followed by them. Both these would include financial aspects, service level agreements and a cataloguing model, among others. Generally the following are key components of a managed services framework - 1. Service Cataloguing toolkit Contains the types of services offered, detailed description of the services offered, customizations, scope, service windows, support specifications, DR specifications, requisition procedures and related dynamics. 2. Service Level Agreement Framework A framework that is aimed at managing the services being offered to the customer with targets defined for performance, quality, rewards and penalty mechanisms, review and monitoring guidelines. 3. Pricing and costing model The financial framework used for the provision of the services that includes the budgeting model, costing and pricing mechanisms, chargeback mechanism and other accounting procedures. 4. Governance Framework The Managed services governance framework talks of the structure, policies, practices that are necessary for the governance of the managed services setup. It also includes establishment of forums/focus groups around specific areas with representation from key stakeholders from Business & IT.

8 5. Strategic Uptake Planning Is aligned to the Customer strategy as a whole and creates higher value for business. 6. Optimized Demand Management Helps in minimizing the execution cycle time, standardizes the processes to ensure consistent customer experience. 7. Quality Delivery through standardized deliverables, engagement success and best practices cascaded across the Managed Service. 8. Optimized Service support with better resource mobilization, higher offshore % and improved governance, scoping & reviews. Additional elements could form a part of the managed services framework based on the Project requirements. However, there are other IT operations and management practices like support processes, and documentation that any organization must establish in order to move into a managed services framework. Strategy The approach starts with the agreement on scope of services targeted in managed services model and Identification of opportunities for managed services within the customer s organization. Prioritization of candidates for Managed Services: Application prioritization is one of the important steps in moving the projects from staff augmentation to Managed Services Model. Prioritization of projects, tasks and activities must be carried out using a set of parameters. Parameters to prioritize the candidates Parameter Description Desired outcome of the Parameter for Faster transformation Business Criticality Management Support Risks Application Stability ROI Productivity Performance improvement potential Where ever there is scope for huge financial, regulatory impacts, it is better to transition those services at a later stage after detailed due diligence. Having senior management s commitment with some business representation is critical. A clear understanding of the risks and mitigation plans to reduce exposure to them is necessary. Risk areas to be considered are Regulatory & legal risks Services that could impact the business in terms of revenue Risks that can cause instability in the IT organization Critical proprietary information and rights Number of changes to the application functionality / architecture Identification of the applications / services that can provide high yield / ROI. Increase in the productivity and the need for reduction in the cycle time Services where there is a scope for performance and quality improvement are best candidates for transitioning into managed services. Low High Medium High Medium Low Medium

9 Parameter Description Desired outcome of the Parameter for Faster transformation Technical Expertise Documentation Process maturity Organizational Readiness Level of Authorization Application Stability Complexity Services where there is skills shortage or lack of technological expertise in customer organization Many applications and Infrastructure related work requires documentation. This technical or nontechnical documentation is necessary when a third party is managing the delivery. Services where there is a level of process maturity with clear roles and responsibilities, standardized processes and procedures Having the capabilities within the client organization for managing service delivery in the new setup. For transitioning into a managed services model, one of the most critical element is having authority for the SPOC from customer side for the services, associated applications and infrastructure The candidate services / applications are reasonably stable. Complexity of the applications being transitioned into managed services mode plays a major role on the tenure of the transformation. Low Medium High High High High Low The below table has parameters related to service provider s capabilities and these can be used by CIOs to evaluate a service provider for any particular piece of work to be outsourced in managed services model. Methodologies, practices, processes Ability to manage demand Domain & Technical Competency MSM Expertise Service providers with proven capabilities that can be leveraged further is extremely important, by not only taking over support but also create value by leveraging their proprietary methodologies, practices and processes. The service provider should have a set up to meet the demand for Managed Service Model. Strong expertise in domain and technology areas and the expertise in using multiple technologies for a business objective. Service Providers with proven expertise in delivering the projects with MSM High Medium High High The above parameters will help in deriving the Managed Service Index which will indicate how soon the service / application / project can be transformed to Managed Serviced Mode. Implementing this model across all services / applications / projects shall derive the Managed Services Transition Roadmap. Design The main goals and objectives of Design are to: Design services to meet agreed business outcomes Design processes to support the service lifecycle Identify and manage risks Design secure and resilient IT infrastructures, environments, applications and data/information resources and capability Design measurement methods and metrics Produce and maintain plans, processes, policies, standards and architecture.

10 Frameworks and documents to support the design of quality IT solutions Develop skills and capability within IT Contribute to the overall improvement in IT service quality. This phase involves creating IT operations service catalogue, mapping business and IT processes through a contract managed service business and operational solution. Outcome of this phase is a clearly defined business case for moving towards managed services. This phase comprising of two sub phases viz. Due Diligence, SLA Framework and Business Case preparation. Plan / Solution Inputs gathered during the due diligence phase are considered for defining plan for delivering the agreed services to customer. This plan can include the technology solutions, process solutions, a high level schedule and effort to deliver predefined scope of services. This scope of work along with SLAs defined below will be the key inputs for preparing the business case. Service Level Agreements (SLAs) Life cycle This section explains the process steps involved in managing the Service Level Agreements. Define SLAs this process covers the work of drafting and refining SLAs, ensuring they meet the customer requirements and gaining agreement from all the parties involved. Implement the SLA once all parties have agreed, the SLA is published, a start date determined and the affected operational teams notified. Measure SLA performance and report results. Refine assess the effectiveness of the service, locate where the gaps or changes are occurred and execute the SLA definition process to adjust the SLA. Managed Services Business Case Detailed Managed Services business case will be prepared and submitted to the customer. The proposal will focus on the below items to deliver the services. Scope of Work Assumptions and Dependencies Methodology and Approach Proposed Technical Solution for new projects Service Level Agreements ROI Time lines & Commercials

11 Governance Model (Engagement Model, Project Organization Structure, Project Management Processes, Project Progress Tracking & Communication, Risk Management, Change Management, Escalation Management) Responsibility Matrix Case Studies Finally, Signed Managed Services contract is an outcome of Service design phase Transition and Service Delivery The transition phase involves taking over the management and operational responsibility of the given scope of work. This is executed by leveraging a program management framework and working closely with the customer to assess, document and validate the steps that are applicable to the defined scope. Transition has below steps and that should be executed with a detailed checklist and toll gate review at regular intervals. Due Diligence To understand the scope of work Transition Planning To make the plan and schedule for the actual transition. It also defines the team structure and the mode of training. Transition Actual knowledge acquisition happens as per the agreed transition plan between different stakeholders. Shadow Support The new service provider provides the secondary support where as the incumbent service provider or internal staff contributes for the primary support. Reverse Shadow Support The new service provider provides the primary support and the incumbent service provider or internal staff provides help to the new service provider in execution. Steady State The new service provider takes the complete charge of service delivery. Optimization stage This is the continuous improvement activity and the service provider shows the continuous productivity improvement throughout the engagement. Managed Services Framework The key elements that frame the managed services model include Delivery Framework, Governance Model, SLA framework and Processes & Tools Delivery Framework that aligns with the service scope and leverages on application development / support needs and skill requirements. The delivery model aims to provide the client benefits from improved quality of service, economies of scale and visibility

12 Governance Model ensures that engagement related decisions varying in criticality, urgency and financial impacts are appropriately addressed through a multi layered governance mechanism operating at strategic, tactical and operational levels Service Level Agreements are defined for each of the services identified and measured during the execution of the project. SLAs are reviewed on a periodic basis and necessary changes are incorporated in consultation with customer. Process and Tools ensures that the delivery teams have appropriate capabilities to provide the services defined. An engagement specific policy and procedures manuals supported by service delivery plans is provided to internal stake holders to clearly define the approach for service delivery. A typical established service provider uses a combination of client provided request handling tools and 3rd party tools to deliver services. Program Management The best of class Framework is implemented with the Program and Project Management methodologies at the organization level, and practice specific engineering life cycle methodologies at the customer engagement level. Figure 4: Program and Project Management Every program sets out their vision and goals based on the stakeholder expectations, Business Unit level KRAs and customerspecific business commitments. This Program Vision and Targets govern Project Initiation and Planning activities, which include Project-level Measures and Goals setting. Similarly, the Project-level performance acts as a feedback loop in monitoring and stabilizing program execution A Program is defined as a group of projects managed using the established Delivery Framework to deliver Software Products and Services, based on customer requirements, to leverage Benefits and Controls, not available from managing them individually.

13 The Program Management methodology provides for processes required to plan, track and manage programs / customer engagements from a strategic perspective Figure 5: Program and Project Management Framework Project Management Figure 6: Project Management - Delivering Right First Time A Project is a value creating business executed in a defined time period which enables delivery of services to the end consumers. Projects provide for further breaking of the scope of engagement / program (strategic business needs of the customer) in to manageable work packets (Development, Maintenance, support, etc.) for effective execution and delivery. The phases of project management include Initiation, Planning, Execution (Tracking & Monitoring, Delivery & Deployment) and Closure. The approach following for delivering project level output right first time is depicted below: Practice / engineering methodologies for Solution / Delivery Software Engineering Life Cycle / practice specific methodologies

14 should have been defined to direct the execution and delivery of solutions and services across disparate technologies. Detailed methodologies and procedures must be available with any service provider s quality process. The relevant portion of the same will be shared with the customer during the engagement kick off. Delivery Structure Delivery team(s) collaborate with the representatives in the customer organization in the context of project delivery Customer Management Team collaborates with the customer at an engagement level, in providing a comprehensive picture of all delivery. Delivery Support by Quality, Competency Solutions, HR, KM and others Figure 7: Delivery Structure Service provider should have a comprehensive governance structure and process in place. The key activities in planning for the governance structure and process include- Establishing a review plan for critical milestones, deliverables and periodic progress Defining a detailed communication plan identify reporting requirements and the various stakeholders who need to be communicated. Determine the frequency of communication and responsibility and, Defining the escalation matrix for issue resolution At program level, every program manager captures communication and review plans pertaining to their programs in any Program Management Portal. The escalation matrix applicable for issue resolution will also be updated in the portal. Program Managers have a provision to upload plans pertaining to document management and knowledge management as a part of the overall program planning phase. Effective program governance is a cornerstone for successful change management and incident / exception management. The change register and an incident / exception register, is used to monitor changes / incidents / exceptions impacting the program. Program Managers leverages on

15 the above features in the portal, in defining a comprehensive governance plan for their programs. This would facilitate the effective monitoring of the governance mechanism during the program execution phase, and help program managers in steering their programs towards success. The typical Governance model for followed in HCL is depicted below- Governance Forum Participants Inputs Outputs Customer s Project STEERING COMMITTEE (Executive Management) Steering Committee Meeting (Quarterly) Sponsor Customer s Senior Management HCL s Head of Delivery HCL s Engagement Project Highlights Review Key Performance Indicators Escalated Issues Executive Commitments Issue Resolutions Strategic Directions Director ENGAGEMENT GROUP (Relationship Management) Engagement Review Meeting (Monthly) Customer s Program Manager Customer s Project Manager HCL s Program Manager HCL s Account Manager Progress Reports Escalated Issues Directions from Steering Committee Risk Analysis Metrics Issue Resolution Project Plan realignment Issue Escalation Resource Requisition DELIVERY GROUP (Project Management) Delivery Meeting (Weekly) Customer s Project Manager Customer s SMEs HCL s Project Manager HCL Technical/Module/ Test/Project Leads Project Status Metrics Directions From Engagement Group Current issues Issue Escalation Revised Plan Metrics Risks MEETING SCHEDULE REPORTS SCHEDULE Steering Committee Once every 3 Months REPORT PREPARED BY SENT TO Engagement Committee Once every Month Weekly Status Report Project Manager All Stakeholders Delivery Meeting Once a week Monthly Progress Report Figure 8: Governance Model Project Manager & Account Manager Steering Committee Indicative SLAs In any managed services engagement, SLAs are aligned with only two objectives One is on time delivery and the other is bug fixing time for resolution. In addition to the above SLA s, the following table contains the sample SLAs that can be followed for the engagement in the Managed Service Model. The actual SLAs will be discussed and mutually agreed upon commencement of the managed services model: Indicative SLAs for Production Support projects are given below. SLA Measurement Matrix Metric Formula Expected Severity 1 Ticket Response Response Time Time of Ticket Response minus Time of Ticket Assignment 15 minutes Severity 2 Ticket Response Response Time Time of Ticket Response minus Time of Ticket Assignment 15 minutes Severity 3 Ticket Response Response Time Time of Ticket Response minus Time of Ticket Assignment 1 hour Severity 4 Ticket Response Response Time Time of Ticket Response minus Time of Ticket Assignment 2 hours Severity 1 Ticket Resolution Resolution Time Time of Ticket Resolution minus Time of Ticket Assignment 4 hours

16 SLA Measurement Matrix Metric Formula Expected Severity 2 Ticket Resolution Resolution Time Time of Ticket Resolution minus Time of Ticket Assignment 3 days Severity 3 Ticket Resolution Resolution Time Time of Ticket Resolution minus Time of Ticket Assignment 30 days Severity 4 Ticket Resolution Resolution Time Time of Ticket Resolution minus Time of Ticket Assignment 30 days Post Mortem Incident Report Time Time within which the Post Mortem report to be sent to the customer for Severity 1 & 2 tickets 24 Hrs Challenges in moving into Managed Services Like any other scenario where there is a substantial organizational change, transitioning into managed services also presents tough challenges in the way of the transformation. Some of these challenges are process related, some technological and some related to organizational & behavioral changes. One of the most important criteria and challenge for the customer organization is to have enough trust on the capabilities of the service provider. Since Managed services requires less oversight and management burden for the customer organization, in spite of clearing all odds, not having trust on the service provider organization and its capabilities can undermine all efforts. Below is a list of few prominent challenges that most organizations face in this transformation. Challenges & their mitigation while moving into the Managed Services Mode: Based on our past experience in converting the engagements into managed services mode, we have listed the possible issues that might develop. We have also given below the mitigation or resolution for each of these issues in order to move the engagement to managed services mode successfully. S.No Challenge Resolution / Mitigation from the Service Provider 1 Dependency on the customer SME 2 Gaining Customer stakeholder confidence for into moving Managed Services Model Service provider will go through the training / KT during the first 6 months to become the subject matter experts for the identified skill/stream. This will help in minimizing the customer SME involvement on a staggered mode and eventually the service provider s team will become self dependent. In order to get the confidence, the movement will be done in a staggered mode - Partially managed and eventually into a fully managed services mode. This will also help in minimizing the risk for the business.

17 S.No Challenge Resolution / Mitigation from the Service Provider 3 Lack of transparency from Service provider 4 Lack of Accountability from Service provider Upon conversion to partially managed / fully managed, service providers follow the defined communication plan to share the project progress, issues/concerns, performance SLAs and metrics with customer. This will be planned at multiple levels. Service provider s onsite co-coordinator will be interfacing between onsite, offshore and customer to minimize any gaps. The SLA based engagement with performance incentives & credits to ensure required accountability from the service provider. 5 Handling architectural changes Service provider team will be supported by the internal Technical Architecture Group and competency groups. These groups provide the technical guidance and also perform technical & architectural reviews to ensure that the deliverables meet the standards. 7 Knowledge Retention Service provider should have a dedicated Knowledge Management portal and framework for customer engagement. The framework enables the service provider to capture, retrieve and re-use the documented knowledge and tacit knowledge. 8 Lack of engagement oversight by the customer 9 Complaint with the service provider s SDLC processes 10 Organizational change management and people communication 11 Business Continuity Plan Customer will continue to manage the engagement by way of the following: - (a) Prioritization of projects (b) Approving milestones (c) Estimation revalidation and approvals (d) SLA based performance monitoring and provision of incentives & credits (e) Toll gate reviews and signoffs for the milestone based deliverables. (a) Before migrating to the Managed Services Model, Service provider would have worked with Customer for nearly 24 months time in project mode. This is a good timeframe for any large application to get the required Knowledge on the service provider s SDLC process followed by Customer. (b) In addition to this, before moving to the Managed services model, a charter will be prepared which describes the process to be adopted. Service provider should be open to follow the process prescribed by the customer, or service provider can suggest its own or a combination of both. In any case, the process will be mutually agreed and implemented. By moving into managed services model, Customer managers will be freed from the routine operational, technical and resource related matters. This will enable them to have more bandwidth for more value added services as well as taking up some of the high end work. This will allow required acceptance from the customer staff. It is also important to provide the direction of the managed services model from the senior leaders of the organization for better and faster implementation. By outsourcing the work in managed services, customer has very little control in day to day operations. In this case, service provider needs to have a disaster recovery plan to run the business as usual in case of any disruption. This should be tested and audited in regular interval. Managed Services Model HCL way of Transformation and Sustenance HCL proposes to leverage its proven MASCoT framework (Managed Application Services with Continuous Improvement to Transformation) that incorporates experiences from previous, similar size engagements wherein HCL has brought value to the customer while over time exhibiting continuous improvements to create the target Operating model for any customer. This Model is designed to provide values to the customer with: Robust Service Delivery Model delivering predictable services Mechanism to effectively measure HCL Performance Control and flexibility Reduced TCO

18 Potential Improvement initiatives driving cost down year on year The model outlines the complete journey from transition to steady state with a focus on continuous improvement and value creation. Figure 9: MASCoT Framework HCL provides Application Development, Maintenance, Support and any transformation work in this model. The below figure provides the levers for each phase. TRANSFORM How will HCL help in transformation? MASCoT Managed Application Services with Continuous improvement to Transformation Proactive preparation of business cases for Transformation Discovery and optimization of business processes, applications, databases and IT infrastructure through BAIT ADD VALUE How will HCL create value? Proactive initiatives for Value Creation within the scope of service Value Register through MyCustomerPortal IMPROVE How will the Service be improved? Productivity benefits through Continuous Improvement Tools & Automation driven Best Practice driven Process & Quality driven Knowledge driven MEASURE How will the Service be measured? SLA / KPIs Integrated reporting through MyCustomerPortal Risk Project Reporting CSAT Billing MANAGE Governance How will the Service be managed? Multi-Vendor Governance Risk Management Project Management Scope Changes Resource Management Demand Management DELIVER Global Delivery Model How will the Service be delivered? Tools (MAST ) CMMi / ITIL-based Processes and Quality Control IOMC Information Security Knowledge Management Standard Development and Estimation methodologies Shared Services Disaster Recovery / Business Continuity TRANSITION Mature and proven ASSeT methodology How will the service be transitioned? HR and OCM Robust Governance SLA Finalization Process Harmonization Tools Setup Infrastructure Setup DEFINE Technical and Commercial Solution What is the Service? Scope (RTB App. Support & CTB App. Development) Governance Transition Strategy & Engagement Roadmap Figure 10: MASCoT Framework Phases Price End Note Defining a long term vision and the roadmap for its execution are the utmost priorities for any CIO. This can be achieved only if CIOs and IT managers outsource the IT work to a service provider in managed services model. This gives more bandwidth to work on strategic things. All operational work to run the business is outsourced to a service provider with agreed service level agreement. It also reduces the total cost of ownership and annual

19 budget can be used for transformation of application to meet the business and market demands. It also brings improved customer delight index. References http://en.wikipedia.org/wiki/managed_services http://www.cio-weblog.com http://technologyoutsourcingblog.com http://managedservicesblueprint.com About the Author Praveen Sinha is part of Mainframe Solution CoE team as ADMS consultant and has 15 years of experience in various areas of Mainframe. In the past, he has worked in several large engagements and converted Staff augmentation or Semi-Managed Services engagement to Managed Service Model successfully. He has also contributed in starting an engagement in managed services model for various Transformation, Development, Maintenance and Support projects across various technologies.

20 ABOUT HCL HCL Technologies HCL Technologies is a leading global IT services company, working with clients in the areas that impact and redefine the core of their businesses. Since its inception into the global landscape after its IPO in 1999, HCL focuses on transformational outsourcing, underlined by innovation and value creation, and offers an integrated portfolio of services including software led IT solutions, remote infrastructure management, engineering and R&D services and BPO. HCL leverages its extensive global offshore infrastructure and network of offices in 31 countries to provide holistic, multiservice delivery in key industry verticals including Financial Services, Manufacturing, Consumer Services, Public Services and Healthcare. HCL takes pride in its philosophy of Employees First which empowers our 72,267 transformers to create real value for customers. HCL Technologies, along with its subsidiaries, had consolidated revenues of US$ 3.1 billion (Rs. 14,101 crores), as on 31 st December 2010 About HCL Enterprise HCL is a $5.7 billion leading global technology and IT enterprise comprising two companies listed in India - HCL Technologies and HCL Infosystems. Founded in 1976, HCL is one of India's original IT garage start-ups. A pioneer of modern computing, HCL is a global transformational enterprise today. Its range of offerings includes product engineering, custom & package applications, BPO, IT infrastructure services, IT hardware, systems integration, and distribution of information and communications technology (ICT) products across a wide range of focused industry verticals. The HCL team consists of over 79,000 professionals of diverse nationalities, who operate from 31 countries including over 500 points of presence in India. HCL has partnerships with several leading Global 1000 firms, including leading IT and Technology firms. For more information, please visit www.hcl.com