DCG-SMS

The Intelligent Customer Organisation

Managing the extended value stream

Outsourcing some standard IT services can be compared to any other commodity supply.

Customers should expect highly competitive pricing for this kind of supply.

However, the real value of IT is as a strategic enabler. The power to deliver on this promise lies in software services. Managing outsourced software services effectively requires sufficient knowledge of the software development process to work in partnership with suppliers.

Customers who recognize a lack of such knowledge in-house can call on DCG-SMS’ wealth of experience in this field to provide an independent, objective, outcome-focused view which puts the customer in control of the sourcing relationship.

An “absentee landlord” approach to vendor management is a very high-risk strategy, particularly when linked to a drive for reduced costs. To deliver the desired outcome as effectively and efficiently as possible, the supplier needs the client’s engagement in understanding and managing the end-to-end process of delivering value.

Understanding Value

Delivering value from an outsourced supply chain requires customer and vendor to work in partnership on understanding and delivering value to the end customer from the extended supply chain.

A supplier cannot deliver good value without the engagement of an informed and committed client management team.

DCG-SMS acts as knowledgeable “honest broker” to facilitate such partnerships.

Shared Values, Shared Success

Outsourcing partnerships have two sets of business stakeholders: the stakeholders in the customer’s business and the stakeholders in the supplier’s business. To foster the stable, long-term relationship that the knowledge-rich nature of much soft systems outsourcing demands, the needs of ALL stakeholders must be met.

Outsourcing partnerships work when client and supplier are a good cultural fit. Shared business values and shared strategic positioning are crucial. A customer organisation focused on innovation is courting disaster by engaging a supplier which is operationally excellent and provides a highly competitive price per transaction.

Procurement processes must support informed consideration of value over transactional cost. Too narrow a focus on transaction costs increases whole-life costs, decreases effectiveness, and significantly ratchets up the risk.

Assurance of Value for Money

It is the supplier’s responsibility to provide the client with assurance that their delivery process provides value for money. Such assurance requires open and honest accounting of performance, typically including:

• Verified, independent, quantified audit of recent engagements
• Volume-based pricing
• Evidence of on-going, continuous improvement in productivity and quality

Agile or not?

Senior DCG-SMS Consultants have been using Agile methods since before this approach was known by the name “Agile” – because Agile is a more effective way for software developers to work. However, the value of Agile development methods cannot be realised without an understanding of the management and delivery framework in which they need to operate. Knowledgeable management is essential to the successful adoption of Agile methods.

If your organization is considering adopting Agile, get the objective view from our Agile specialists.

Contact DCG-SMS:
+44 (0) 843-289-5174
info@dcg-sms.com