Digité Blog: Prabhas' IT Governance Blog

Global Delivery Model and SLAs -- Do they gel well?

Prabhas Sinha — Thu, 08 Feb 2007 05:34:00 +0000

Ever thought why SLA is needed when one of your IT initiative is being executed and delivered via global delivery model ? Is it worth fretting about SLAs?
My understanding is that people still see outsourcing projects as a consumer product and suffer from "give me a perfect piece else I will ask for money back" syndrome. You have selected a service provider whom you consider is a specialist in the service you want. Instead of tying them down with stringent SLAs, it needs careful management of this relationship. SLAs should not be assumed as something that will meet its levels automatically regardless of how the relationship is managed.
Surveys shows that more than 50% of the IT outsourcing projects fail to meet customers’ expectations , which eventually makes it apparent that in most cases SLAs simply aren’t working. It is obvious to conclude that stringent SLAs may actually be part of the problem rather than the solution.
By pressuring service providers to meet strict time limits you may be encouraging them to cut corners or in no time at all the service provider may start to feel that they can’t win and a quasi-adversarial relationship develops between the customer and service provider.

It is more about customers placing greater trust in the professionalism of their IT service providers. So when you're out there looking for a specialist to do your job, do judge if they are professional enough to cater to your needs.

SLAs are not going to be abolished for the simple fact that it would be needed for some sort of legal recourse when deals go wrong, however, the stakeholders from both the sides should understand that SLAs can not be a replacement for the close monitoring and co-operation. Thereby, see if your service provider has means and tools that would allow you to collaborate with them, get regular visibility into whats going on 10,000 miles away from you so that you can continuously monitor the progress and avoid the need to resort to SLAs.
In one of his interviews, Chairman/CEO/Co-founder of Syntel, Mr Bharat Desai said that "A strong governance model is critical to communication. Syntel's model uses an Engagement Management Office (EMO). The EMO is staffed by both the customer and vendor and manages the relationship, user satisfaction, operations, quality, forecasting, reporting, contract compliance and more. As part of the EMO process, a steering committee with members from both the vendor and client side meet monthly or quarterly to ensure the engagements remain focused, on track and meeting the established service level agreement points."

Paradigm Shift in Software Lifecycle Management

Prabhas Sinha — Tue, 06 Feb 2007 20:26:00 +0000

If you are one of those who started programming 2 decades back, at that time project management was easy and there were hardly any collaboration & process challenges -- ofcourse the programming was the only difficult task. Fast forward.... I was pondering today that how do people see software lifecycle management now? Heard the Disney Song: "It's a whole new world"? Read a few interesting articles on ComputerWorld by Mitch betts. Here are the highlights:

1."Project team members would be thousands of miles away because the business is forcing the organizations to get the best talent, wherever it resides. It is resulting in nightmare in managing the project without the right tools and processes in place."

2. "Time to market is the key to success for business managers but my team that is executing the projects are fretting about the extra 15-20% time they spend on compliance/process related work."

3. "IT would focus on end-to-end processes rather than functional stovepipes, application development would turn into business process delivery. IT would collaborate with the business to design improved business processes, capture the process in metadata that would drive the design and operation of composite applications. Composite would pull together SOA-based business services and modular user interfaces to meet the specific needs and workflow of each business process, giving users integrated, contextual, multichannel access to transactions, content, collaboration, and communications. Business intelligences would close the loop, using process metadata to report process metrics, driving analysis for the next round of business process improvement." -- Randy Heffner, analyst, Forrester Research Inc., Cambridge, Mass.

4. "As application development deals with the pressure of cost reduction and productivity improvement and grapples with compliance issues, development shops will focus more on development planning and process management. They will look at establishing and automating predictable processes and enhancing project management capabilities. As more application development shops fine-tune and improve processes, they will focus on effectiveness factors that impact development projects like communications. In globally sourced development projects there will be an emphasis on global project management like developing cultural intelligence to deal with different cultural, language and communication challenges; and requirements and relationship management skills that will impact project productivity." -- Jack Duggal, managing principal, Projectize Group LLC, Simsbury, Conn.

5. "True globally distributed development shops will require teams to use agile processes to remain competitive. Within the next two years, large corporate IT shops will turn to agile development processes as a means to deliver value to the business and be more responsive to their customers. Drawing largely on experiences from open-source projects, corporate IT managers realize that their traditional approaches aren't cutting it, and that they need to make some pretty significant changes if they are to keep pace with competitive demands. One interesting twist: Outsourcers, and offshore firms in particular, will be pressured to adapt to agile processes as well -- a huge challenge for firms that have made their money on highly productive waterfall processes that meet CMM Level 4 and 5 requirements. Not all will be able to make this transition." -- Liz Barnett, vice president, Forrester Research Inc.

6. "Pressure for increased agility and faster time-to-market will drive the continued focus on agile methods -- though IT organizations will struggle with the shift in development, project management and operational management practices. Rapid, incremental and test-driven development to reduce delivery cycles, with refinement/refactoring, over time will predominate in successful organizations. Integration of agile methods with distributed teams will further force the hard conversations regarding how best to accomplish both." -- David Moore, director of North American branch operations services, Keane Inc., Boston

I also wanted to take this opportunity to comment on my earlier post Perception and results of the Indian IT success story has a gap. Despite all the perception gaps, the success of Indian Services players are primarily because they have understood the above mentioned 6 points very early and very clearly, which indeed is giving them an edge over their contemporaries (ESPs) -- setting up the right tool in their organization that would take care of their collaboration challenges, process standardization, reduced cycle time, and have multiple readymade process templates on various methodologies (waterfall or agile). Digité surely is playing a key role in this business transformation for some of the Indian IT services companies.

Progress Report

Prabhas Sinha — Mon, 05 Feb 2007 21:10:00 +0000

"So how is the company doing ?" -- many of you would ponder before thinking of hedging your bet on us. Here are 5 facts you would consider in inviting us for a discussion:
1) The number of user licenses have gone up by over 400%
2) We work with 2 of BIG FOUR and 4 of top 5 Indian Services giants
3) The product is scalable and our largest installation has over 20k users
4) Gartner has noticed us in their Magic Quadrant report last year and recently talked about us in their "Hype Cycle for Application Development" report.
5) Watch out for the fifth accolade which we will announce in a few weeks time.

CMMI Ver1.2 automation with Digité

Prabhas Sinha — Fri, 02 Feb 2007 07:01:00 +0000

Digité is announcing its latest release this month end that would facilitate quick and smooth implementation of CMMI Ver1.2 level 3 processes. The product will expedite the attainment of maturity, allow SEPG/PMO to model process templates, perform process appraisal, collate process improvement requests and develop action plan for them. Monitoring process performance against organization / process / project / phase level goals would get a lot easier where Hard & soft checks would enable compliance of individual projects with a process template.
On one hand Gartner is emphasizing that software lifecycle management activities are being refined and strengthened to drive more predictability and to meet the challenges of global sourcing, Digité is offering CMMI Ver1.2 automation to emphasize the alignment of the process improvement objectives with organizational business objectives. A quality system being followed manually has higher error margin because each team and Project Manager can have their own interpretation. Maturity attainment is slow and subsequent maturity maintenance is a Herculean Task. Manual, paper-based processes creates silos, which is no way in line with the principle of Global Delivery of Software and Services. Ask for a demo to see how Digité new release would take care of your CMMI Ver1.2 compliance so that you dont have to distract from your primary business -- Application Development, thats where your revenue comes from.

Digité enters Gartner's "Hype Cycle for Application Development"

Prabhas Sinha — Mon, 22 Jan 2007 14:39:00 +0000

Software Lifecycle Management is challenging when people work in the same office. Imagine what happens to complex projects in global delivery model? In December 2006, Gartner published report on “Hype Cycle for Application Development 2006” in which James Duggan, Joseph Fieman and Matt Light commented on Collaborative Tools for the Software Lifecycle Management. The report says that tools like Digité would cater to significant cost savings and revenue and mitigation of the risk posed by the globally distributed teams and globalization of application delivery. Read More . . .

Perception and results of Indian IT success story has a gap

Prabhas Sinha — Sat, 18 Nov 2006 09:04:00 +0000

I was going through a recent research by Gartner wherein they presented some interesting facts about Indian IT Service providers, scanning through the outsourcing lens:
1. Indian companies scale up to 70% when it comes to business expertise.
2. Off-site communication effectiveness is 46% (surprisingly on-site communication effectiveness is 78%)
3. Security Risk is 54%
4. Legal and Regulatory Risk is 60%
5. Foreign Trade and Payments Risk is 54%
6. Infrastructure Risk is 75%
7. Capacity for innovation is 3.75 on a scale of 7
8. Ethical behavior of companies are rated at 4.2 on a scale of 7
9. Government's priority for IT has been rated at 5.7 on a scale of 7

You might be wondering that with so much of not-so-positive flags, the growth in the industry has altogether a different story to tell -- outsourcing is at its peak if you look into some of the biggest deals that Infosys, TCS, Satyam & Wipro have cracked in the last 3-4 quarters.

Where is the gap ? It just can not be the cost advantage. Would look forward to hear from what people have to say.

Digité a cool vendor in Application Development space, says Gartner

Prabhas Sinha — Tue, 10 Oct 2006 16:10:00 +0000

In a recent Application Development (AD) Summit, Gartner talked the various factors that influence Application Development in a collaborative environment including the AD Sourcing cost Model, Inhibitors of globally distributed AD, Communication and Effectiveness of globally distributed AD etc. They have talked about availability of numerous tools from vendors like IBM, Microsoft, Oracle, Borland, Mercury, Compuware, Serena, however, mentioned that such tools havent transformed into a seamless platform.
They have talked about the requirements for distributed AD and have identified Digité as one of the "cool vendor" among 4-5 other players. Write to me if you would be interested in knowing more about it or even contact Gartner.

IEEE approach to Portfolio Management

Prabhas Sinha — Wed, 12 Jul 2006 08:55:00 +0000

Came across an interesting article by IEEE where the authors have talked about "Picture approach" of Portfolio design in large organizations. The approach focuses on the entire IS portfolio in an enterprise and aims to support decision making on system complexes rather than tweaking IS in parts. You can also download the PDF version of this paper.

Gartner mentions Digité

Digité — Mon, 26 Jun 2006 03:52:00 +0000

Last week Gartner published their 2006 Magic Quadrant for IT Project and Portfolio Management Applications, authored by Matt Light and Daniel Stang. According to them "IT-oriented project and portfolio management (PPM) solutions are becoming more comprehensive, ... Interest in enterprise PPM — beyond, but often encompassing, IT — is on the rise." Amongst others, they have mentioned Digité as a key player in the IT-oriented PPM space.

Management of global sourcing initiatives

Digité — Fri, 16 Jun 2006 03:27:00 +0000

I have been thinking about the hoopla around Global Delivery of Software and Management of Outsourcing Initiatives. Global outsourcing is here to stay, there are no qualms about it. Simple business case is Cost and productivity benefits that helps to seize the competitive advantage. These benefits seems to be real, but often becomes challenging to materialize. The problem starts where the rubber meets the road. Top 4 in my opinion are:
1) In rush, corporations opt for outsourcing or service providers grab every opportunity without pondering about the disparity in process maturity between service providers (Offshore) and customer (Onshore). Service providers are on the higher side of CMM/CMMI (with most of them being at level 4 or at level 5) whereas outsourcers typically arent at that level.

2) The case of requirements gathering. Service provider's team almost always struggle with specifications ambiguity and constant changes. Project managers on both the sides often struggle to ensure that project priorities are clearly understood and changes to the project plan are clearly agreed upon and communicated at every level, not just at senior management level but also at the lower level.

3)Inadequate Information to the team: Most of the time, resources have very narrow understanding of the bigger picture because it isnt easy to communicate every information that clearly describes the project, what is needed to meet business objectives, risks/issues involved and schedule/milestones/deliverables. Often, critical information is localized only to the project managers or project leaders.

4)Outsourcers as well as service providers often doesnt align themselves to a commonly understood IT process maturity which typically include aggregation of standardized methodologies; continuous process improvement practices; project management skills; change control procedures; portfolio management and service-level agreements.

The 4 challenges that I have mentioned can only be taken care of if teams on both the sides have 24x7 access to the project/process information and work on the same workbench. Lack of readiness in any of these areas will result in lost productivity, repeatitive change and a suboptimal result.

Long time . . .

Digité — Fri, 09 Jun 2006 15:28:00 +0000

Apologies for being incommunicado for quite some time. Had been caught up at personal front(having been blessed with a little angel a few weeks back) as well as the new product release with our CMMI offering. Meet us at China International Software & Information Service Outsourcing Summit where we will showcase the new release for the first time. Along with this, you will also have the opportunity to hear what our CEO (who is a keynote speaker at the conference)has to say about "Quality Frameworks - Key to Global Outsourcing and Offshoring success".

Will touch base again with more . . .

contd: IT Portfolio Management and its flavors

Digité — Fri, 27 Jan 2006 12:16:00 +0000

This is in continuation of my previous post on IT Portfolio Management and its flavors where people have requested for expanding this topic. So here it is what I have gathered from my interaction with a few analysts. . .
IT Portfolio Management can be comprised of:
>> New Initiatives
>> Infrastructure Investments
>> Externally mandated initiatives
>> Current Investments

These results in various flavors of Portfolio Management that I have talked about. Lets look at them one-by-one.
You can read about ERP for IT in this journal.

1) Project Portfolio Management
Purpose is:
>> to manage New Initiatives or Projects currently underway
>> to monitor activity and resource information

Goal is:
>> Elimination of redundancy
>> Better resource utilization
>> Real-time business value metrics

2) Application Portfolio Management
Purpose is:
>> to inventory existing apps and tie them to business processes
>> deliver management intelligence about apps

Goal is:
>> Better alignment of maintenance and renewal decisions with business goals
>> Disaster recovery and business continuity planning

3) Enterprise Infrastructure Portfolio Management
Purpose is:
>> to Manage IT Assets
>> to Deliver system performance information

Goal is:
>> Better License Compliance
>> Better maintenance and replacement requirements for improved utilization

whereas I can sum up IT Lifecycle Management as a combination:
1) Project Portfolio Management
2) SLA Management and
3) Collaborative Development

If you have apetite for more then I would recommend getting hold of any analysts from Gartner, IDC or Forrester to brief you about it or better procure a few of their reports for details.

Next Generation of Software LifeCycle Management

Digité — Thu, 09 Mar 2006 06:05:00 +0000

While interacting with a few big corporations on the importance of buying a product of Digité Enterprise genre to cater to their application development, many times I have heard from them that they would or are developing such products on their own. We did argue about the additional work load on the application owners, lack of cost transparency from such initiatives, freeing time to focus on business tasks etc. On a few occassions, some of them got back to us to try out our product. Here is an interesting article from McKinsey on the next generation of in-house software development that talks about the advantages of buying software applications off the shelf rather than developing them in-house. (You might have to register to read this article) but worth a read.

IT Governance and Application Development

Digité — Fri, 10 Feb 2006 15:23:00 +0000

If you are thinking of maximizing the business value of your IT capital allocations, attention has to be given on IT processes and their automation to avoid risks due to weak IT controls.

Organization must look at their IT Governance initiative in line with following business drivers:
i) Business planning,
ii) Application Lifecycle Management,
iii) IT operations and
iv) Outsourcing Governance

For (i) & (ii), integration of project portfolio management and application lifecycle development processes should be coordinated by template processes to encourage enterprise wide adoption.
PPM would not only help in business planning (i) but would also bring out the
value of application development (ii). With such closed loop mechanism,
organizations can demonstrate the value of project investments and learn from successful and failed capital allocations.

Keeping in mind the globally distributed nature of the business environment and outsourcing governance, global delivery model framework should be worked upon where Application LifeCycle processes can be managed via CMMI while ITIL can be implemented for (iii), specifically IT service management.

Overall this approach will help in prioritization of organization’s IT projects and programs and will give competitive advantage and efficiencies of scale.

CMMI to ITIL: An obvious graduation?

Digité — Fri, 17 Feb 2006 17:49:00 +0000

IT organizations striving to improve their business should or must be looking for various models and frameworks beyond CMMI. ITIL is the obvious next step. While CMMI is focused towards software development,maintenance, product inegration etc., ITIL provides a framework specifically developed for IT Service Management and operations. IT Services Management is being increasingly adopted by organizations to ensure that the IT processes are closely aligned to business processes and that IT delivers the correct and appropriate business solutions whether it is for Corporate Business Change Plans or Outsourced Application Management or Outsourced Infrastructure Management or BPO.

Important question then to answer is:
How to get the best RoI from the efforts of implementing these models? Is there
any relationship or overlapping among these frameworks?

With our CMMI implementation, we also answered these questions.
There is definite scope of mapping between ITIL processes and various CMMI practices.
To give a heads-up, some of the key CMMI processes that maps to the ITIL processes are:
Project Planning
Project Monitoring and Control
Integrated Project Management
Measurement & Analysis
Configuration Management
Requirement Management/Development
Risk Management
Validation
Product Integration etc.

And they map to ITIL processes like:
Problem Management
Helpdesk
Incident Management
Change Management
Configuration Management
Service Level Management
Planning and Control
Contigency Planning
Security Management
Availability Management
Capacity Management etc.

Digite's Universal Process Framework makes it all the more easy to implement ITIL process templates. However, one caution: Amidst all the process improvement framework, one shouldnt get into "process obsession" mode. Assess the level of risk in the processes, the need for the extent of management control and regulatory requirements and focus on "just enough processes" -- facilitate the process improvement to make a significant difference in your IT services delivery or business performance, instead of overburdening yourself with process mania.