Outsourcing Partnership – Shared

PerspectivesJames Brodie, NFU Mutual,

UK

Europe’s Premier Software Testing EventStockholmsmässan, Sweden

WWW.EUROSTARCONFERENCES.COM

“Testing For Real, Testing For Now”

Outsourcing Partnership

Shared Perspectives

Introduction

James Brodie

Test Manager/Service Delivery Owner

NFU Mutual

Introduction

This is a presentation based around an outsourcing project I have participated in within the last year.

This isn’t a sales pitch for a vendor.

This IS a talk about the challenges I have faced from inception through to the day to day running of the relationship.

This will be useful for anyone who is about embark on their own outsourcing/ relationship journey

What are you looking for

Outsourcing? Partnership?

•How much appetite/ capability do you possess for managing a day to

day relationship?

Why are we doing it

Remove constraints on skill and Full Time Employee FTE demand

requirements to address additional testing areas (e.g. non functional

testing)

Gain a greater and more efficient access to tooling and automation

Gain greater and more efficient access to test consulting

Allow internal capability to focus on the Intellectual Property (IP) of

running the NFUM core business and move their contribution up the

value chain

To provide flexibility to address variable demand across a number of

testing phases/requirements for additional testing areas

Achieve long term cost efficiencies for additional testing areas

What are we doing

Assess

Tangible and measurable results of alternative approaches

Robustness and flexibility to stand the test of time

Measure

Performance of the relationship using KPIs (e.g. productivity, quality, timeliness,

reporting, Others – downtime, support effectiveness, effectiveness of knowledge

management, etc)

Ability to meet common or specific business need

Validate

Phased approach driven by maturity levels to minimize risk and disruption, but

significant enough to deliver benefit (i.e. not a body shopping exercise)

How are we going to do it

Using all the work done to date formalise the activities to achieve an informed and

tangible closure

Create a simple capability assessment document, this should also include details of

any Proof of Concept (POC) dates and potential size etc

Identify a specialist suppliers that could work in partnership to help develop the best

strategy moving forward.

Use existing capability statements to help develop the understanding of viable models

and help formulate an initial strategy

Formalise engagement with these specialist suppliers, and in collaboration allow them

to demonstrate their tangible capabilities evidenced by maturity in the models by

using real life examples (in the insurance space)

An implementation plan for formalised POC(s) with a selected supplier

Verify the selection based on results of the POC(s)

Our Journey

The selection process

Qualifying selection

Living the relationship.

The Selection Process

A simple scoring matrix to gain hard and tangible results

A simple commercial assessment model to compare one partner with another etc.

Evaluation criteria should be developed prior to engagement to ensure honest and independent evaluation of partners

Set common challenges for suppliers to overcome via the capability statement, which can then be used for tangible evaluation

Suggestions of common challenges faced elsewhere.

Status

Oct 08 Oct 15 Oct 22 Oct 29 Nov 05 Nov 12 Nov 19 Nov 26 Dec 03 Dec 10 Dec 17 Dec 24

Overall Governance

Activity Initiation

Capability Statement

Establish Contractual & Commercial Framework

Stakeholder

Engagement

Kick-off Meeting 25/10/07

Pipeline Demand

Selection Timeline

Supplier NDAs *

Start to issue Supplier H/L* Capabilities

Supplier Assessments

Identify POCs

Set Customer/Demand Makers Expectations

Collate Commercial Information

Selected

Supplier

& POCs

Detailed

POCs

Plans

2007

LOI*/Heads

of Terms

Detailed Service Descriptions

Checkpoint

Go/No Go

21/12/07

Communication

Current and Future Business

Risk Profiling

Team Supplier Meetings

Relevant Client Case Studies

Identify Relevant

Clients 29/11/07

Team Client References

Request For Proposal (RFP)

Project Scope

Procedure

Benefit Realisation

Supplier History & Capability

Requirements

Relationship

Commercial Considerations

Exit Strategy

Contractual Requirements

Add Value And Innovation

Format And Presentation Of Responses

Audit And Control

RFP From The Vendors Perspective

• Understanding the needs of the Client

• Technology

• Domain

• Testing requirements

• Value addition

• Relevant prior experience

• Key personnel

• Key differentiators that the client can take away

Proof Of Concept (POC)

Objective

Outcome

Scope

Background Information

Methodology

Timelines

Metrics

SLAs

Success Criteria

POC – Vendors Perspective• First impression is the best impression

•Delivery

• On Schedule

• On Budget

• To the required standards/ quality

• Showcase

• Understanding

• Talent

• Experience

• Knowledge

• Go beyond stated client needs

•Gain an understanding of client pain points and organization

POC Scoring Matrix

Governance

• Effective framework to manage the relationship

• Key personnel

• Escalation mechanisms

• Conflict resolutions

• Identifying key metrics

• Account review mechanisms

• Reporting mechanism

• Change management

Governance – Vendors Perspective

Onsite Account Manager First point of escalation

Receiving all sourcing requirements from NFUM

Coordinating to get the right fit resources

Coordinating with NFUM Group IT Testing team to seek clarity on exact skill requirements, etc. and organize any interview that needs to be done

Ensuring agreed SLAs are met for resourcing

Relationship managementowns the business case

Program managementDrives the vision and strategic intent to a project level

Project Managementensuring the management of project delivery on everyday basis

Operational managementensuring the technical and quality compliance during delivery of the project

Key principles Transparency at all levels and forums

Periodic checkpoints, timely escalation and quick decision making

Living The Relationship

Procedures

Ensuring that you have your own procedures documented

Ensuring the procedures are explained and understood PRIOR to a

piece of work starting.

The vendor needs to know of any unique conditions of employment.

Service Level Agreements (SLAs)

Agreeing the terms of the SLA

Which of the SLAs will have the biggest impact on the business

Which of the SLAs will you deal with most commonly?

Have the SLAs been communicated to all the major stakeholders?

Living The Relationship

Integrating the teams

Moving away from us and them

Team building

Going as far as vendor staff managing NFUM staff

Knowledge retention/transfer

Between vendor and NFUM

Between vendor staff

Moving up the value chain and away from pure staff augmentation

Moving beyond Testing Service

Living The Relationship

Issue Resolution

Timely raising of issues

Willingness to work together

Confidence Building

Metrics

Reviewing of work

Impact on other relationships (e.g. contractors/agencies)

Communicating potential change to other parties

Living The Relationship

Management overhead

The need for a relationship owner to deal with day to day issues

Escalation points

Juggling business as usual with vendor management

Management liberation

The ability to hand over a piece of work with confidence.

Governance

Ensuring you follow the disciplines set down in the governance documents.

Being able to work to the spirit of the document rather than relying on it to resolve issues.

Living The Relationship

Moving offshore

Staff may worry about their jobs

Connectivity Issues

Ensuring communication procedures are in place.

Quality reviews

Metrics

Reporting structure agreed.

Living the relationship - measurement

The Vendors Perspective

Cultural Integration

NFUM specific knowledge

Speed

Process expectations e.g. Lack of formal capacity planning

Critical Success Factors

Investment in knowledge transfer

Investment in designated people for relationship management

Budgeting for initial teething problems

Periodic checks and balances

Key Objectives To Takeaway

Honest addressing of both teams’ questions will give you a far more

productive environment

Agreeing which metrics both companies use ensures expectations are

understood and agreed, and it allows you to implement SLAs.

Communication is the key to any engagement. By initially having some

tough talking it allows both sides to work within agreed parameters.

Questions

Contact Details

Company Website www.nfumutual.co.uk

Email: james_brodie@nfumutual.co.uk