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Presentatie over innovatie in outsourcing

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Presentatie gegeven bij IIR cursus IT en Recht. De eerste helft is van Alan Steele Nicholson, het laatste deel van mijzelf.

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Presentatie over innovatie in outsourcing

  1. 1. Innovation in an Outsourcing RelationshipSeminar ICT Contracten voor JuristenIIR LegalAlan Steele Nicholsona.steele@mitopics.nlWalter van Holstw.van.holst@mitopics.nl30 august 2012Onafhankelijk IT-advies vanuit de combinatie van technische, bedrijfskundige en juridische expertise
  2. 2. Independent IT consultancythrough technical, business and legal expertiseStrategy ContractingFeasibility studies Contracts and SLAsIT policy NegotiationChange management Dispute resolutionProcurement Assessment(Out)sourcing AuditsEuropean public sector procurement ValuationsContract management Expert reportsRenewal AndProgramme of requirements Second opinionsIT and partner selection Project managementImplementation management Workshops
  3. 3. Innovation in an Outsourcing Relationship 3Agenda Introduction PON’s Innovation Workgroup Lessons Learned PON’s Standard Outsourcing Contract Discussion
  4. 4. Can innovation happen after the ink is dry?Platform Outsourcing Nederland‘Creating innovation by outsourcing and alignment’8 December 2010Alan Steele Nicholsona.steele@mitopics.nl
  5. 5. Where does it go wrong?Creating innovation by outsourcing and alignment 5It’s human nature. People like watching thevendor grovel and getting them to come down inprice. The client deal team comes back andeveryone congratulates them on how theykicked the vendor’s butt. But in the end, you getwhat you pay for.– Ben Trowbridge, CEOAlsbridge plc“”
  6. 6.  Pick up where PON left off in 2010 Review previous studies; build on them: Academics and practitioners Gather/circulate actual cases Link up with groups abroad Prepare a seminar & whitepaperTask of PON Innovation Workgroup
  7. 7. Innovation withinoutsourcing relationships- the theory -
  8. 8. AddedvaluetothebusinessLow HighLowHighImprove thebusinessImprove thebusinessOptimize ITOptimize ITImpact on and risk for the organizationInnovate thebusinessInnovate thebusinessOptimize IT operations and servicesOptimize IS development & changeOptimize systems and IT architectureOptimize/cut IT costImprove customer service/convenienceImprove business processes (speed,time to market, reliability, flexibility)Improve/cut business costImprove market approachCreate new businessNew products/servicesNew customer groupsNew business modelsNew marketsRadicalinnovationIncrementalinnovationWhat is the level of innovation?Spoor & Silvius (Presentation, 2010)
  9. 9. TimeMaturity levelCost StageEconomic BenefitsTransaction costContractsPrincipal – AgentFirm BoundariesCost StageEconomic BenefitsTransaction costContractsPrincipal – AgentFirm BoundariesResource StageAccess to resourcesInnovationStrategic ResourcesCore CompetencesSkills & CapabilitiesResource StageAccess to resourcesInnovationStrategic ResourcesCore CompetencesSkills & CapabilitiesPartnership StageAllianceEconomic ExchangesRelational NormsSocial ExchangesStakeholdersPartnership StageAllianceEconomic ExchangesRelational NormsSocial ExchangesStakeholdersGottschalk & Solli-Seather (journal 2006)Gottschalk & Solli-Seather (journal 2006)Improve thebusinessImprove thebusinessInnovate thebusinessInnovate thebusinessOptimize ITOptimize IT
  10. 10. Source of innovation in an outsourcingReactiveInnovationOrganisations’s InnovationProactiveInnovationCollaborativeInnovationLevel of domain expertiseVan der Linden (IEEE Conference, 2011)
  11. 11. What are the enablers/disablers?Weeks & FeenyWeeks & Feeny (scientific paper, 2008)(scientific paper, 2008)
  12. 12. Impact of cultural dimensions
  13. 13. Conclusion Think about at what level you want to boost innovation Think about your maturity level of outsourcing andinnovation Think about where innovation within organisation cancome from Think about what and who the enablers/disablers are Think about the impact of different cultures on innovation
  14. 14. - efficiency, efficiency, efficiency -Operational Innovation
  15. 15. AddedvaluetothebusinessLow HighLowHighImprove thebusinessImprove thebusinessOptimize ITOptimize ITImpact on and risk for the organizationInnovate thebusinessInnovate thebusinessOptimize IT operations and servicesOptimize IS development & changeOptimize systems and IT architectureOptimize/cut IT costImprove customer service/convenienceImprove business processes (speed,time to market, reliability, flexibility)Improve/cut business costImprove market approachCreate new businessNew products/servicesNew customer groupsNew business modelsNew marketsRadicalinnovationIncrementalinnovationWhat is the level of innovation?Spoor & Silvius (Presentation, 2010Spoor & Silvius (Presentation, 2010)
  16. 16. Do’s Describe architectural framework/ limitations Establish incentives for innovation Sufficient know-how available in client organisation Match needs with supplier Implement standard approaches Focus on requirements: ‘What’ do parties want (not ‘how’) Enable process improvements E2E (chain) Formal lessons learned sessions at end of contracts
  17. 17. Don’ts Dictate or limit the solution Enforce own standards Focus on rates only Not pay enough attention to innovation within contract Ignore the win/win Make it supplier’s problem
  18. 18. Observations Most innovation organized in selection phase, notcontract phase Technology roadmaps support operationalinnovation Challenge for ongoing relationships: Moreefficiency means often less money for supplier
  19. 19. - doing the game differently -Business Process innovation
  20. 20. AddedvaluetothebusinessLow HighLowHighImprove thebusinessImprove thebusinessOptimize ITOptimize ITImpact on and risk for the organizationInnovate thebusinessInnovate thebusinessOptimize IT operations and servicesOptimize IS development & changeOptimize systems and IT architectureOptimize/cut IT costImprove customer service/convenienceImprove business processes (speed,time to market, reliability, flexibility)Improve/cut business costImprove market approachCreate new businessNew products/servicesNew customer groupsNew business modelsNew marketsRadicalinnovationIncrementalinnovationWhat is the level of innovation?Spoor & Silvius (Presentation, 2010Spoor & Silvius (Presentation, 2010)
  21. 21. Do’s Relationship based on trust and measurement Soft skills and hard skills are always needed Co-creation is possible Innovation does not have to be part of the standardcontract Innovation governance Business / Domain knowledge
  22. 22. Don’ts Deadlock: expecting the other party to start it Focus on the contract Independent actions Not focusing on orthogonal innovation Learn from other sectors Outside your own scope
  23. 23. - a different game -Strategic Innovation
  24. 24. AddedvaluetothebusinessLow HighLowHighImprove thebusinessImprove thebusinessOptimize ITOptimize ITImpact on and risk for the organizationInnovate thebusinessInnovate thebusinessOptimize IT operations and servicesOptimize IS development & changeOptimize systems and IT architectureOptimize/cut IT costImprove customer service/convenienceImprove business processes (speed,time to market, reliability, flexibility)Improve/cut business costImprove market approachCreate new businessNew products/servicesNew customer groupsNew business modelsNew marketsWhat is strategic innovation?
  25. 25. Case study: Internet payment –Atos1. Clear ownership and executive sponsorship2. Clear responsibilities and governance3. Trust4. Transparency in objectives for both parties5. Separate agreements for Innovation6. Attention for communication7. Commitment (long term, flexibility)8. Capabilities (provider as well as customer)
  26. 26. Don’ts- Stating the obvious: No clear ownership No alignment between or even within partners Not enough attention for Innovation in contract Not challenging the win/win of both parties The (consortium of) client(s) should not focuson technology requirements: leave this to theIT partner No Cultural fit
  27. 27. Conclusions:• Level of outsourcing is important• Flexibility is essential: parties are in a greenfield• Strategic innovation does not originate from anoutsourcing contract• The majority of strategic innovation initiativesoriginates within the customer organization• All the disablers found were obvious• Parties underestimate strategic innovation challenges
  28. 28. Contracting Approach For the contractual aspects, the contract is notthe only aspect… For certain innovation, the contract is not even themost important aspectContractContractManagementContracting life-cycleRFx Process
  29. 29. Output Best practices for of innovation throughoutcontracting life-cycle: RFx-phase: checklist Contract: checklist & example clauses Contract management: checklist Best practices were similar for all types ofinnovation, except for Strategic Innovation
  30. 30. RFx phase Get incentives right Pick right supplier Set (mutual) goals and expectations Set transparent business process(es) and domainknowledge Dedicate resources (people, approp. expertise, funding) Establish path towards trust Draft approp. clauses  set up contract management Process & strategic innovation: establish long-termcommitment
  31. 31. Contract Define innovation required/expected Agree metrics to track success Establish dedicated governance structure: Innovation board/ managers, communication, escalation Allocate innovation funds & other required resources Contract clauses themselves: A schedule to the outsourcing contract Not a mandatory list for each contract Only provide guidance for discussions and negotiations Innovation projects  separate project agreement
  32. 32. Contract management Work on building & maintaining trust, e.g.: Periodic meetings: reviewing ambitions &achievements Setting realistic timelines Ensure both parties adhere to the contract Keep ‘innovation’ metrics separate fromoperation Ensure effective knowledge retention Capture lessons learned
  33. 33. Contracting Conclusions General best practices & conclusions– Build, maintain and measure trust (=ongoing process)– Define and agree what parties expect– Secure management support &(financial) resources– Innovation governance– Incentives must promote sharedrisk/reward Contractual provisions re. innovation are anenabler, not a prerequisite
  34. 34. Creating innovation by outsourcing and alignment 34You want to get to thecastle, yougot to swimthemoat.“”– Elizabeth Gilbert‘Eat Pray Love’
  35. 35. PON’s Standard Outsourcing Contract Brief overview of the contract Look at it from an innovation perspective Other issues
  36. 36. Brief overview Background Structure Contract management issues
  37. 37. Innovation perspective Service innovation Security innovation
  38. 38. Service innovation Merely an expression of good intentions No clauses on the process of innovation No clauses on how to distribute the benefitsof innovation
  39. 39. Security perspective Service innovation Security innovation
  40. 40. Conclusions Both from a contract control and aninnovation perspective the PON standardcontract may already be outdated More of a set of building blocks than acomplete solution Outsourcing contracts are still tailor made
  41. 41. Creating innovation by outsourcing and alignment 41Questions?

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