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Strategic Enterprise-Wide Initiatives: Finding the Right Partner

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  • Related Giga Research Planning Assumptions Title, Author Title, Author IdeaBytes Title, Author Title, Author
  • Until we start making buying decisions based on quality, US software developers will not be able to compete on quality – because at this point, we just don’t have to. US perception that quality isn’t affordable is flawed. If you use processes, which reduce cycle times, costs by increasing productivity and bug fixes, etc,. The quality initiatives will seem cheap in comparison t the savings. Until we start making buying decisions based on quality, US software developers will not be able to compete on quality – because at this point, we just don’t have to US perception that quality isn’t affordable is flawed
  • How much will this cost? Fixed fee/time and materials? Gain sharing? Availability and Pricing How does the consultant plan to manage the inevitable clash between consultants and internal developers with different skill sets? Cultural Integration What process does the consultant have in place for using internal staff and training them on the project? Knowledge Transfer How does SP manage knowledge capital Knowledge Management What is the methodology? How are consultants trained in it? Are consultants compensated for contributing? Methodology Which consultants will actually be working on your project? Consultant Quality What are the firm’s core technical competencies? Technical Expertise Has the SP worked with similar companies? Industry Expertise Questions to Ask Qualification
  • Does the vendor invest in soft skills training? What type of training is provided? Soft skills training SEI CMM assessments, ISO 9000/9001, etc. In regards to SEI CMM, who was the auditor or assessor? When was the assessment done? What percentage of the development and maintenance organization was assessed? What is the vendor’s process maturity, and what type of quality assessments/certifications have been done? Some vendors specialize in one rather than the other. For example, you do not want to use a vendor for maintenance outsourcing that specializes in new development projects. Percentage of business from new application development vs. maintenance/support outsourcing If you require all onsite staff, make sure the vendor has local talent. If you want to get costs as low as possible, make sure the vendor has the requisite offshore resources and the remote management maturity. Breakdown of local vs. offshore talent. To ensure that the vendor has experience in the area for which you require support. Reference projects
  • Specific tasks carried out are as follows: Arrive at the Functional Architecture from the scenarios. The functional architecture will address all the functional requirements of the system. It depicts the interactions between the functional components. This view is primarily for the business managers. Validate the functional architecture by mapping the scenarios to the functional components Arrive at the System Architecture taking into consideration the non-functional requirements and super-imposing the system components on the functional components. The system architecture portrays the interactions between the various components, process flow and provide a basis for detailed design. Risk identification and risk mitigation activities are also addressed when arriving at the architecture Validate the System Architecture with the non-functional requirements by mapping the requirements to the system components Selecting Technology and Commercial Off The Shelf Software for components identified. Determine the deployment of system and provide a Deployment View.
  • Transcript

    • 1. Strategic Enterprise-Wide Initiatives: Finding the Right Partner A Netsession hosted by Cognizant Technology Solutions June 28, 2002 2:00-3:15 PM EST AGENDA 2:00-2:30 PM: Stephanie Moore, Vice President and Research Leader, Giga Information Group 2:30-3:00 PM: Doug Schafer, First Vice President, Options Trading System Development, Philadelphia Stock Exchange 3:00-3:15 PM: Q & A
    • 2. Offshore and Nearshore Opportunities State of the Art in Strategic Global Sourcing Stephanie Moore Vice President & Research Leader
    • 3. Outsourcing Drivers Focus Quality Time to Market Skills Shortage Specialist Requirements Cost Savings/ Containment OUTSOURCING DRIVERS 2002 Be very clear what your drivers are!
    • 4. Global Sourcing
      • Improved networking and communications technologies have changed how and where we do business.
      • Remote workers and teams are commonplace.
      • Global sourcing permits cost, quality and time to market benefits that are unattainable in local regions.
    • 5. Offshore Outsourcing — India Dominates
      • Dominant player
      • Indian firms have honed their offshore management processes
      • Cost
      • Quality
      • Language
      • Local presence
      • US acceptance of Indian vendors
      • Skills base and offerings (not just cheap and COBOL and applications)
      Outsourcing to India is becoming a driver rather than a deterrent!
    • 6. India Dominates -- Skills on Offer
      • “ Legacy” application maintenance and support
      • ERP, CRM, J2EE, XML, Web services development, support
      • Infrastructure outsourcing
      • Managed services: help desk
      • Consulting: strategy, quality, architecture
      • Business process outsourcing
      India continues to move up the value chain and now competes head to head with the former Big Five consulting firms and top tier systems integrators
    • 7. Other Geographies Offshore and Nearshore: China, Philippines, Eastern Europe, Vietnam, Ireland, N. Ireland, Canada, Mexico
    • 8. US-Based Outsourcers and Consultants Promote Global Delivery Capabilities
      • Reaction to intense financial pressure
      • Strong references and customer desire for global sourcing solutions
      • Intense pressure from the established Indian vendors who are moving up the value chain just as the US outsourcers attempt to perfect their delivery of commodity services.
    • 9. US-Based Professional Services Firms’ Offshore Offerings
      • Have not invested as much time or money in perfecting their offshore delivery capability
      • Quality and process maturity not a priority until now
      • Low-level maintenance and development work was the norm
      • Cannibalisation
      • Many firms partner for the offshore skills
      • But, offshoring to a local SI viewed as less risky
    • 10. Modern Global Delivery Client Location Global Development Centers
      • Strategy
      • Program Management
      • Analysis and planning
      • High level design
      • User interface design
      • Project co-ordination
      • Onsite testing
      • Implementation
      Project
      • Project management
      • Detailed design
      • Coding
      • Testing
      • Documentation
      Project
      • Bug fixes
      • Warranty support
      • Maintenance
      Post implementation support
      • Rapid reaction support
      Post implementation support Discovery Most projects mix onshore and offshore resources
    • 11. Offshore Sourcing Risks
      • Cultural issues/clash
      • Language barriers
      • Distance to vendor
      • Time zone differences (can be a plus or minus)
      • Political instability
      • Telecommunications infrastructure
      • General country infrastructure
      • Management challenges (PM skills weak in India!)
      • All other general outsourcing risks
      Risk analysis is the first step. Benefits must outweigh risks to proceed.
    • 12. Contingency Planning is Critical for All Indian Vendor Relationships
      • Pay attention to standard DR, BCP
      • “ N ear-site” employee pools
      • G uarantees of onsite-ready staff
        • Visas
        • Local facilities or non-Indian remote facilities
      • B uilt-in network redundancy
      • Increased security
      • Documentation
      • Contract provisions
        • Who pays for what?
    • 13. Vendor Selection Methodology
      • Define your needs
      • Develop selection criteria based on those needs
      • Research the market using reputable third party resources. Investigate:
        • Vendor skills
        • Vendor clients
        • Case studies
      • RFI/RFP
        • Vendor responses will immediately reduce candidates
      • Visit vendor facilities
        • Interview engagement mangers, project managers, developers (random), architect/technical specialists
    • 14. Selection Criteria
      • Industry expertise
      • Technical expertise
      • Consultant quality
      • Methodology
      • Knowledge management
      • Knowledge transfer
      • Cultural integration
      • Availability and pricing
    • 15. Additional Offshore Vendor Criteria
      • Reference projects
      • Breakdown of local vs. offshore talent
      • Percentage of business from new application development vs. maintenance/ support outsourcing
      • What is the vendor’s process maturity, and what type of quality assessments/ certifications have been done?
      • Soft skills training
    • 16. Critical Success Factors
      • Use transparent model
      • Disciplined requirements definition
      • Selection of appropriate pilot projects
      • Vendor selection process
      • Clear objectives, metrics
      • Active relationship management
      • Clear communications plan
      • Significant onshore presence in early stages
      • Make internal process & quality improvement integral
      • Senior executive sponsorship
      • Develop (tele) communication plan before the contract is signed
      • Understand and focus on cultural issues
      • Measure performance, success
    • 17. PHLX Next Generation Architecture Douglas M. Schafer, Jr. First Vice President, OTS Development
    • 18. About PHLX
      • Founded in 1790; First organized stock exchange in US
      • Provides Market place to trade
        • Stocks
        • Equity options
        • Index options
        • Foreign currency options
      • Financial Automation Group (~160 staff members) is responsible for all exchange automation development and support
        • Three trading systems supporting each of the exchange trading floors
        • Trade Data Access System to support market surveillance, marketing, and Web based customer reports.
        • Exchange Business System to support trade clearing and settlement, accounting & billing, security management, and customer transmissions .
    • 19. Exchange Project Goals
      • Architecture to Specifically Address the Redesign of the Back-Office and Surveillance/Marketing Systems
      • Develop an Enterprise-Wide Architectural Solution That Would Address:
        • Enhancement of services via timely access to enterprise data
        • Real-time and non-real-time data accessibility between platforms while minimizing impact to trading floor systems
        • Increased scalability demands
        • Industry mandates such as T+1, STP, COATS, etc.
        • Growing obsolescence of some enterprise components
        • Unnecessary development of infrastructure
        • Desire to increase development efficiency and minimize costs while maintaining sufficient quality and reliability
    • 20. Next Generation Architecture
      • Develop an Enterprise-Wide ‘Blueprint’
        • Provide As-is and To-be functional systems views and identify gaps
        • Cross-reference additional business drivers and ‘pain areas’ against the to-be functional view
        • Accommodate various stakeholder concerns
        • Address Non-functional requirements (performance, SLA’s, migration, best practices, etc.)
        • Provide a roadmap for product selection, development and deployment framework, and future functionality by mapping functional/non-functional requirements to various views
        • Verification of architecture by testing functional/non-functional requirements against the ‘blueprint’
        • Develop implementation plan based on internal and external drivers (industry deadlines, migration risk, staffing, cost, etc.)
    • 21. Partner Criteria
      • Strong team management with the ability to focus and ‘drive’ towards a solution
      • Experienced with other architectural engagements
      • Experienced with formal process and project management geared toward architectural assessment
      • Previous knowledge of PHLX systems and/or industry experience
      • Ability to draw on quality personnel from multiple disciplines
      • Ability to effectively use PHLX staff where appropriate
    • 22. Vendor Evaluation Process
      • Generated an RFP outlining the objectives of the assignment and the expected role of the vendor
      • Invested the time with the bidders to educate them prior to entertaining formal responses
      • Kept the number of bidders to a small number to insure quality bids
      • Asked for a formal written response and an oral presentation. Used the presentation to evaluate the depth of the talent being assigned to the project and the depth of real experience
      • Careful to avoid ‘boilerplate’ responses by clearly outlining expectations during the process
    • 23. Cognizant – Our partner
      • Extensive knowledge of PHLX systems from prior successful engagements
        • Executed Decimalization project for PHLX’s complete Back office operation - Exchange Business System(EBS) and Stock Clearing Corporation of Philadelphia(SCCP)
      • “ Dream team” approach leveraging Cognizant’s extensive talent pool with strong IT Engineering Orientation
        • Technical competencies - Data warehousing, Message based middleware, J2EE
        • Financial domain experience
        • Enterprise Architecture modeling capabilities
      • Worked with major stock exchanges and brokerage firms
      • Also experienced in Custodial operation and STP/T+1 requirement
    • 24. Project Deliverables
      • Architecture Blueprints with multiple view points
        • Functional view
        • Data view
        • System view
        • Technology & Deployment view
        • Technology Integration Matrix
      • Implementation & roll-out plans
      • Architecture Workshops
      Provides the ‘big picture’ for various stakeholders
    • 25. Engagement Roadmap Interactive Workshops Tool based inventory; Prior Application knowledge Multiple viewpoints
      • Architecture
      • Requirements
      • Functional
      • Nonfunctional
      • Environmental
      Start-up Meeting
      • Architecture
      • Models
      • Functional
      • System
      • Data
      • Technology
      • Deployment
      Top down Stakeholder Interviews Bottom Up Code Inspections Architecture Iterations Presentation of models & refinements
      • Final Architecture
      • Implementation Plan
    • 26. Proposed Architecture Blue Prints System View Referential Data Management Back Office SCCP Front Office Accounting Enterprise Data Management Infrastructure Services Front Office Enterprise Data Management Reporting Auditing Archival Security Backup & Recovery Communication
    • 27. Technology Paradigm shift
        • Host centric ‘stove-pipe’ applications
        • Batch ‘pipe & filter’ processing model
        • Legacy databases and Processing platforms
        • J2EE Application Server based environment for distributed application development and deployment
        • Asynchronous Message based communications environment for near real time sub-system coupling
        • Data warehousing for enterprise data management
    • 28. Recommendations
      • Smooth phased transition of existing systems to new architecture
      • Implement new architecture patterns and technology for a single function
      • Phased investment on infrastructure and technology considering budgetary and staffing constraints
      • Core Technology - Message-based Middleware, Relational Data Store and Application Server Environment
      • Enterprise Data Management – ETCL, Metadata Repository, OLAP and OLAP Reporting
      • Generic Services – Scheduler, Audit and Logging, Monitoring and Management Service, Security Service, Archival, Backup & Recovery, Communication Service
    • 29. Summary and Lessons Learned
      • Invest the time up front with the vendors during the selection process. Need to provide the vendor with a clear idea of the scope, objective, and expectations.
      • While the vendor can be an invaluable resource, ultimately the client must internally be clear as to their objectives and be able to critically evaluate options in a timely manner.
      • Internal buy-in regarding the objectives and the process is essential and must come from the top. An internal team with appropriate representation and decision making power is essential.
      • The vendor needs to have the appropriate technical domain experts available at critical points in the process to support the primary architecture team.
      • As with any outsourced project, the talent of the vendor team is ultimately the most important success factor. Beware of vendors selling ‘process’ without talent and experience.
    • 30. Thank you for your participation Q&A For more information, please contact Deb Mukherjee at 323-377-6787 or at [email_address]

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