Need for Process Management in IT and ITES


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ASQ India RIMS 8 Oct Chandra Kumar Raman

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  • Sources: India Inc.: An Overview of the Indian IT-BPO Industry – NASSCOM (Apr 2010) Indian IT-BPO Industry 2009: NASSCOM Analysis – NASSCOM (Feb 2009) Asia-Oceania Vision 2020: Enabling IT leadership through collaboration – KPMG (2009)
  • India Inc. - An Overview of the Indian IT-BPO Industry – NASSCOM, April 2010 Perspective 2020: Transform Business, Transform India – NASSCOM
  • Need for Process Management in IT and ITES

    1. 1. Chandra Kumar Raman Lead – Quality / Master Black Belt – HP President – SPIN Chennai [email_address]
    2. 2. <ul><li>Chandra Kumar Raman </li></ul><ul><li>Engineering graduate with P.G Diploma in Management </li></ul><ul><ul><ul><li>Certified </li></ul></ul></ul><ul><ul><ul><ul><li>Master Black belt from ISI </li></ul></ul></ul></ul><ul><ul><ul><ul><li>ISO 9000 Lead Auditor </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Scrum Master </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Lean Leader </li></ul></ul></ul></ul><ul><ul><ul><ul><li>ITIL V3.0 professional </li></ul></ul></ul></ul><ul><li>21 years of experience in Quality Process/ Delivery excellence . Adept in the application of ISO, CMM, CMMi, PCMM and Six Sigma </li></ul><ul><li>Currently associated with HP in their Quality operations as a Programme Manager and driving the initiatives </li></ul><ul><li>President of SPIN Chennai </li></ul><ul><li>Program Chair ASQ chennai </li></ul><ul><li>Member of the board of studies of ICTAT </li></ul><ul><li>Syllabus revision committee member : Reviewed the PG syllabus of ME (Quality) of Anna University and designed syllabus for Lean Sigma and Quality Assurance and Business Excellence models </li></ul><ul><li>Advisory board member and jury for various conferences /conventions </li></ul> Brief on me…
    3. 3. SPIN Chennai <ul><li>SPIN, Chennai ( Software Process Improvement Network ) is a forum of Software Professionals for the free and open exchange of software process improvement experiences and ideas. The organization serves as a source of educational, scientific and practical information for its members, other SPIN organizations, and the general software community. The SPIN Group aims to be a leadership forum for free and open exchange of SPI experiences and ideas, covering all aspects of how an organization improves the way it develops and maintains software and delivers software intensive services. SPIN organizes a variety of meetings, all aimed at mutual self-help for practitioners. </li></ul><ul><li>SPIN Chennai was formed as early as 1994 and was one of the earliest SPIN chapters in India. It has been functioning as a voluntary body of Software professionals since then. Since its inception it has held numerous talks featuring many interesting topics on Software Process improvement featuring some outstanding personalities viz.. Dr. Watts Humphrey (SEI), Mr. Steve Masters (SEI), Mr. David Reo (European Software Institute), , Mr. Terry Rout , International Office - Griffith University, Mr. Lakshmi Narayanan - CTO, Cognizant Technology Solutions, Mr. Steve Shook , AIS Inc. </li></ul><ul><li>FAQ – SPIN : Refer  </li></ul><ul><li>Visit for more details </li></ul>
    4. 4. <ul><li>Est ablish a leadership forum for open exchange of software process improvement experiences and ideas </li></ul><ul><li>Promote achieving higher levels of process maturity and software quality . </li></ul>Mission & Vision
    5. 5. <ul><li>Monthly Knowledge sharing sessions </li></ul><ul><li>Annual conference </li></ul><ul><li>Best Practices sharing </li></ul><ul><li>Academia collaboration </li></ul><ul><li>Collaboration with other professional forums </li></ul>Activities
    6. 6. <ul><li>IT-BPO Sector revenue USD 88.1 Billion(FY2011) </li></ul><ul><li>Direct Employment- 2.5 million </li></ul><ul><li>Indirect Employment- 8.3 million </li></ul><ul><li>6.4% of India’s GDP </li></ul><ul><li>14% of total exports </li></ul><ul><li>10 % of India’s service sector revenues </li></ul>
    7. 7. Indian IT Industry CAGR: 21% IT-BPO Industry size $28.1 Bn $37.4 Bn $47.9 Bn $62.9 Bn $69.4 Bn $73.1 Bn The industry continues to be an export led sector with foreign providers accounting for over 30% of the total market
    8. 8. IT Industry Impact on Indian Economy Source: Nasscom Areas Impact Employment Creation <ul><li>45% of new urban jobs created (1995-2005) </li></ul>Contribution to Education <ul><li>6-7x fold increase in tertiary education in exporting states </li></ul>Diversity and Global Exposure <ul><li>Women in the workforce estimated to be 30%; new entrants-45% </li></ul><ul><li>30% of delivery outside India </li></ul>Contribution to Exports <ul><li>Exports offset close to 65% of India’s cumulative net oil imports over past decade </li></ul>
    9. 9. Global IT spending <ul><li>Worldwide IT spending is forecast to total $3.67 trillion in 2011, a 7.1 percent increase from $3.43 trillion in 2010, according to the latest outlook – Gartner </li></ul>
    10. 10. Gaining laurels : Indian IT services <ul><li>India’s IT spending is likely to double between 2007 and 2012 , touching $110bn – Gartner </li></ul>
    11. 11. Gartner @ Economic times Nov 28, 2008 How about the competitors India’s Outsourcing Rating Criterion Rating Language Very good Government support Excellent Labor pool Excellent Infrastructure Fair Education system Very good Cost Very good Political and Economic Environment Very good Cultural compatibility Good Global and Legal Maturity Very good Data and Intellectual property, Security and privacy Good
    12. 12. Our Pie in IT Outsourcing <ul><li>  The global outsourcing industry, including offshoring and onshoring, is estimated to reach $464 billion in 2011, </li></ul><ul><li>Revenue of the off shoring segment to amount to $144.8 billion. </li></ul><ul><ul><li>India will capture 42.5 % of the offshore market to reach $61.5 billion in revenues, </li></ul></ul><ul><ul><li>China will continue to lag India with revenues reaching $45.7 billion equivalent to 31.5 % of the market </li></ul></ul><ul><ul><li>The Philippines will still hold the third spot with estimated revenue of $10.7 billion capturing 7.4 %. </li></ul></ul><ul><li>Source : Canadian-based ICT research and advisory think tank, XMG Global – 27 th July 2011 </li></ul>
    13. 13. Competition <ul><li>China also has a stronger hold in the domestic BPO market. In 2010, more than 75 percent of service outsourcing revenue is from the domestic market. Chinese companies are looking at outsourcing locally as an option to compete globally </li></ul><ul><li>Indian outsourcers are also starting to realize the importance of the growing domestic market. Indian service providers, which used to shun the domestic Indian market three to four years ago in favor of higher revenues from the US and UK, are now looking to diversify their client base. </li></ul><ul><li>The Philippines is likewise taking steps to gain more of the offshoring market share from non-English speaking countries. The Board of Investments announced in July 2011 that it would be teaming up with IBM Philippines to conduct research and implement programs to build the multi-lingual talent pool of the country for business process outsourcing </li></ul><ul><li>Vives concluded, “Given the continued growth of competition and increasing demand from other countries besides the US and Europe, XMG Global expects a sustained displacement and redistribution of market share not only between India and China but in other emerging outsourcing destinations such as Brazil, Mexico and Malaysia .” </li></ul>
    14. 14. Challenges <ul><li>Be competitive by Sustaining the cost advantage </li></ul><ul><li>Moving up in the value chain </li></ul><ul><li>Sustaining the present credentials in the Quality of the deliverables </li></ul><ul><li>Availability of competent and quality resources </li></ul><ul><ul><ul><ul><li>Time to Train the Resources </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Training Cost </li></ul></ul></ul></ul>35 % of the Graduates only can be productively employed – Economics times
    15. 15. Shift in focus <ul><li>Focus is shifting to attracting to huge investments, and engaging employees to understand customers customer From becoming employable to deployable </li></ul>
    16. 16. The world has changed <ul><li>X to Y Gen </li></ul>
    17. 17. Theory X <ul><li>With Theory X assumptions, management's role is to coerce and control employees. </li></ul><ul><li>People have an inherent dislike for work and will avoid it whenever possible. </li></ul><ul><li>People must be coerced, controlled, directed, or threatened with punishment in order to get them to achieve the organizational objectives. </li></ul><ul><li>People prefer to be directed, do not want responsibility, and have little or no ambition. </li></ul><ul><li>People seek security above all else.. </li></ul>
    18. 18. Theory Y <ul><li>With Theory Y assumptions, management's role is to develop the potential in </li></ul><ul><li>employees and help them to release that potential towards common goals. </li></ul><ul><li>Work is as natural as play and rest. </li></ul><ul><li>People will exercise self-direction if they are committed to the objectives (they are </li></ul><ul><li>NOT lazy). </li></ul><ul><li>Commitment to objectives is a function of the rewards associated with their achievement. </li></ul><ul><li>People learn to accept and seek responsibility. </li></ul><ul><li>Creativity, ingenuity, and imagination are widely distributed among the population. People are capable of using these abilities to solve an organizational problem. </li></ul><ul><li>People have potential. </li></ul>
    19. 19. Stake holders <ul><li>Who are the stake holders ? </li></ul>
    20. 20. Customer-Organization- Employee Customer Organization Employee <ul><li>Product/ Service </li></ul><ul><li>Quality </li></ul><ul><li>Cost </li></ul><ul><li>Cost of Delivery </li></ul><ul><li>Productivity </li></ul><ul><li>Top line </li></ul><ul><li>Earnings and Learnings </li></ul><ul><li>Work Life Balance </li></ul><ul><li>Brand </li></ul>
    21. 21. Mfg vs IT cost frame work <ul><li>Mfg Industry </li></ul><ul><li>RM </li></ul><ul><li>Plant Machinery </li></ul><ul><li>Salaries </li></ul><ul><li>Over heads </li></ul><ul><li>Profit </li></ul><ul><li>IT Industry </li></ul><ul><li>Salaries </li></ul><ul><li>Building and other Overheads </li></ul><ul><li>Profit </li></ul>
    22. 22. Salaries vs Profit Salaries Other OH Profit 55-60 X 18-22 Above numbers are in %   Salaries Other OH Profit Say 55 25 20 Y1 55+6=61 25 14 Y2 67 25 8 Y3 73 25 2 Y4 80 25 -5
    23. 23. Cost of Error /Defect
    24. 24. Human Errors <ul><li>Lack of process knowledge </li></ul><ul><li>Lack of tools knowledge </li></ul><ul><li>Lack of system knowledge </li></ul><ul><li>Lack of domain knowledge </li></ul><ul><li>Introduced with other repair </li></ul><ul><li>Change coordination </li></ul><ul><li>Individual mistake </li></ul><ul><li>Communication problem </li></ul>Is it possible to prevent ?
    25. 25. Why we need a process ? <ul><li>To be cost competitive </li></ul><ul><li>Quality </li></ul><ul><ul><ul><li>To do the Right things first ( To minimize the rework/ COPQ) </li></ul></ul></ul><ul><ul><ul><li>Consistency </li></ul></ul></ul><ul><ul><ul><li>Measure the process and product Quality </li></ul></ul></ul><ul><ul><ul><li>To prevent the defect </li></ul></ul></ul><ul><ul><ul><li>Optimize COQ </li></ul></ul></ul><ul><li>To provide consistent deliverables ( Language/ Culture / Country ) </li></ul><ul><li>To meet Stake holder needs </li></ul><ul><li>To meet Statutory / Regulatory Requirements </li></ul>Process : The means by which people, procedures, methods, equipment and tools are integrated to produce a desired end result <ul><li>Industry is growing – X% - YOY </li></ul><ul><ul><li>Churn in the human resources </li></ul></ul>
    26. 26. Process flow Software Engineering Process Project Management Process Software Development
    27. 27. <ul><li>Can good technical knowledge on basics alone fetch you the job? </li></ul><ul><li>Would knowledge on SW Engineering Processes increase your employability? </li></ul><ul><li>Why do we need to understand the Organisation needs? </li></ul><ul><li>How would understanding of customer needs benefit me? </li></ul><ul><li>Is it required to understand the different Types of Projects ( Development / Maintenance / Support) in IT? </li></ul>Points to Ponder
    28. 28. Recommendation to Shift FROM TO Any Academic Projects Projects on Emerging Technologies /Business Areas Focus merely on Technical learning Soft Skill Sheer Class-room lectures Application of Technical knowledge Academic Qualification Promotion of Additional Certifications Aligning to curriculum Forums of Industry (i.e. ASQ, SPIN , IEEE, CSI, PMI etc) Faculties to look forward to academicians To Industrialists to bring the needs to lecture hall
    29. 29. Models and Methodologies <ul><li>ISO Standards </li></ul><ul><li>CMMi </li></ul><ul><li>PCMM </li></ul><ul><li>Six Sigma </li></ul><ul><li>Lean </li></ul><ul><li>ITIL Frame work </li></ul><ul><li>PSP /TSP </li></ul><ul><li>Knowledge Management </li></ul><ul><ul><ul><li>Learning's from the past experience </li></ul></ul></ul><ul><ul><ul><li>Sharing the best practices </li></ul></ul></ul>Driving factor : The desire to deliver added value and value for money to the customer
    30. 30. In Summary . . . <ul><li>Understanding the Software Engineering / Project Management Process and it’s Importance is as important as Technical skills. </li></ul><ul><li>Understand the Customer Expectation than the Specifications. </li></ul><ul><li>See the big picture and meet the industry expectation </li></ul><ul><li>Emerging Quality Models / Skills will be a big plus, which will give a competitive edge </li></ul>
    31. 31. Thank you ! Coordinates: Raman Chandra Kumar [email_address] 9840712755