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Trends and Challenges in the IT outsourcing process

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Published on

IBM Conference Day.
Cátedra IBM-Rational
Universidad Politécnica de Madrid
Madrid, Spain
19th June 2012

Published in: Technology, Business

Trends and Challenges in the IT outsourcing process

  1. 1. Trends and Challenges inthe IT outsourcing process Dr. Javier Garzás www.javiergarzas.com @jgarzas
  2. 2. Outsourcing Market
  3. 3. Throughout 2009 and2010 the number ofcompanies interested inoutsourcing increasedby over 100%(Gartner)
  4. 4. The News outsource the staff of weather information
  5. 5. Argentina now exports moresoftware than beef
  6. 6. The kinds of IT outsourcing
  7. 7. OUTSOURCING Janitorial Services Linen Services IT OUTSOURCING TASK SOURCING & BUSINESS PROCESS Finnance & Human Data Capture, Call Center Medical/Legal Accounting Resources Integration Transcription APPLICATIONS AND SUPPORT Applications Desktop Application Data Center Teleco NetworkDevelopment Maintenance Service Support Support
  8. 8. Onshore OffshoreInsource Multinational Traditional companies and transfer of employeesOutsource Domestic Offshore Outsourcing Outsourcing
  9. 9. Nearshore: takesadvantage of boththe proximityand theoutsourcing
  10. 10. Nearshore advantages compared to % OffshoreProximity 60%Same time zone 42%Similar culture 41%Same language 39%Political and economical similarities 29%Other local advantages 9% Carmel, Abbott (ACM)
  11. 11. Spain: offshore target, nearshore reality.
  12. 12. IT outsourcing is the largest growing field (ASIMELEC)
  13. 13. Organization Software Development DCGrowing Software thedemand for complexity complexity ofIS has grown finding professionals has increased
  14. 14. The number of new students in software engineering degrees per year 2010/2011 INE y www.javiergarzas.com
  15. 15. 17th June 2012
  16. 16. Organization Software Development DCGrowing Software thedemand for complexity complexity ofIS has grown finding professionals has increased
  17. 17. Organization Software DC developmentSoftware Factory Software Factory Softwaredevelopment DC Software development
  18. 18. Due to the growth of outsourcing, software factories in Spain are"immune to the crisis" (2010)
  19. 19. www.fabricasdesoftware.es
  20. 20. There are about 200 softwarefactories in the country. Now the challenge is to attract major European customers
  21. 21. 2008
  22. 22. "Of the total outsourcing billed, less than 5% arebusiness services in Europe."
  23. 23. "The dream of becomingEurope’s India is not fulfilled, perhaps because of Eastern European countries." (2010)
  24. 24. Outsourcing: models of best practice and certifications
  25. 25. Spain, the firstEuropean powerwhen it comes to quality IT certifications
  26. 26. 70% Growth in the last 5 years
  27. 27. More than half of all sourcingcustomers report havingrenegotiated a contract, andin nearly one-quarter ofthese renegotiations theoriginal service provider lostthe accountGartner
  28. 28. Between 20% and 25% of alloutsourcing relationships failin the first two-year period.Some 50% of therelationships fail within fiveyears.Dun & Bradstreet
  29. 29. Nearly 70% of therespondents noted that theoutsourcing supplier “didn’tunderstand what they weresupposed to do” and “thecost was too high and theyprovided poor service”Ozanne
  30. 30. The traditional businesssoftware (human resources atcompetitive salaries) could be a threat INTECO (2010) 34
  31. 31. The outsourcing impliesnew processes and the use of specific management techniques Shao, B. B (2007). ACM
  32. 32. “If the customer doesn’t demand quality, theyprobably won’t receive it” Humphrey, W. H. (2005). Acquiring Quality Software
  33. 33. Nowadays, to compete for a project it isnecessary to have quality certification. Most of the tenders require quality certification.
  34. 34. Organization Software CPD developmentSoftware Factory Organization IT Software Factory Softwaredevelopment CPD Software development
  35. 35. Models for Models for clients providers eSCM-CL eSCM-SP CMMI-ACQ ISO 20000 CMMI-Dev ISO 15504/12207
  36. 36. Models for Models forprocesses products eSCM-CL/SP, ISO 25000 CMMI-ACQ, ISO 9126 ISO 20000, CMMI-Dev, ISO 15504/12207
  37. 37. eSCM-CL/SP
  38. 38. eSCMFor Providers For ClientseSCM-SP eSCM-CL
  39. 39. Spain is a world leader in the number of implantation and certification of ISO 20000 and ISO 15504 norms
  40. 40. Softwarequality labsdo exist
  41. 41. Challenges and futuretrends. Some common mistakes and recomendations
  42. 42. An outsourcing project is not the same as a “body shopping” project
  43. 43. The kind of contract (andbilling model) determines the provider’s way of work
  44. 44. The greater the distance between client and providers the moreimpact the problems have (and the more management that is required)
  45. 45. Both client andprovider have to have mature processes
  46. 46. In software developmentprojects, outsourcing onlybased on cost is not agood idea
  47. 47. Models Integration (eSCM, ISO 15504, etc.)
  48. 48. GlobalSoftwareDevelopment
  49. 49. Specific SLAs, to determine the software quality, etc.
  50. 50. Javier Garzásjavier.garzas@kybeleconsulting.com www.javiergarzas.com @jgarzas

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