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  • 1. PROVIDERS OF STRATEGIC STAFFING Dr Jason CarterManaged Service Provider

2. Industry service industry Overview Industry service industry transformation Business model Competitive advantage Outlook Major Players Rivalry among existing players Company Overview SWOT Analysis Factor evaluation Matrix Competitive Strategies in Economic Downturn 3. IT Service Industry : Overview Size & Growth ($B) On-shore incumbents are1000still larger: IBM, Accenture Off-shore players growing : 800TCS, Wipro, InfosysTechnology 600 47% Annual growth 400803.9(2003 vs. 2004)524 200 Still 0.8% market share 020032009Fragmented market 4. Steadily growing industry $150 million in 1991-92 to $5.7 billion in 1999-2000 ( $4 billionworth of software exports ) Annual growth rate of Software Exports - over 50 percent Software exports to around 95 countries around the world More than one third of the global Fortune 500 companiesoutsource requirements to India Upcoming market openings for IT industry IT Services Software products IT- enables services E-businessSource: Gartner 5. IT Service Industry : Transformation Change in Customer Needs Change in Offerings Invest in new technologies on faith Traditional enterprise applicationand without strong links to ROIpackages measurements (Over-purchase!) Homogeneous infrastructure More demanding in ROI Off-shore IT services Get more out of tech investment SOA (Service-oriented Rapid adaption /modification Architecture) & Web services Specific point solutions Applications as services 6. Business ModelDefinitionVehiclesCustomer Value Lower CostThe process of Proposed breaking projectsdevelopment andFasterdown into theirInternet marketingImplementationlogicalcenter components andLower Risk then distributingAnd Virtual;those componentsresource bench Measurable to locations(onsite, nearshore,Innovationor offshore) whereModular GlobalSourcing to Meet New they can be delivered at FrameworkCustomer maximum value.Needs 7. Business Model 1-1-3 Model DefinitionVehiclesCustomer Value On-shoreIntegrate the management businessconsulting talent Lower consulting and blendedOn-shoretechnologyrates liaisonsimplementationlifecycle. 1-1-Off-shore 3 model givesresources Faster one client one Implementresource onsite,ationone FR resource 1-1-onsite, and 3 FR 3combined with Integration Tech resources GDM offshore. 8. What are the Competitive Advantages?Access to InfosysTechnologiesLarge supply of clientslow-costIT/process Strong resources operationalskillsCost &speed1-1-3 ModeladvantageBlend on/off shorecoming from 1-1-3 and Unique,Cost efficientGDM modelblended model Easier tointegrateoffshorewith onshore 9. If company guidances areanything to go by, then theoutlook for the industryseems bleakhttp://www.businessweek.com/globalbiz/content/jan2009/gb20090121_832742.htm Collapse of the US carindustry to impact TCS,Wipro and Infosys During recessions, tech spending has historically fallen by more than the GDP A McKinsey study indicates that IT spending has typically fallen by 5-7 times the GDP inthe past recessions The BFSI sector that pioneered the move offshore idea has been butchered and isexpected to worsen 10. IT Consulting Market Context & Structure Subset of overall IT services market Projected single-digit growth of 5%Largely fragmented market with 2 key segments: On-shore consulting and IT services players (Accenture, IBM, Cape Gemini, EDS) Off-shore IT services players(Wipro and TCS) Largest shares held by Accenture and IBM 11. Infosys Technologies Wipro Technologies Tata Consultancy Services IBM Global Services HCL Info systems Cognizant technology solutions 12. Multiple players: TCS Accenture Wipro Infosys Cognizant HCL Tech Patni . . . . The list is large Competition is global in nature andstretches across boundaries andgeographies Replication of the off shoringmodel by MNC IT majors 13. RIVALRY AMONGST EXISTING PLAYERS ( CONTD ) Until the recent crisis, themarket as a whole wasexpanding A growing market meant thatthere was enough and morefor all the players in themarket The problem of stagnating markets Implies that all the players need to gun it out amongst themselves to grow revenues Rivalry expected amongst existing players to intensify 14. Specializes in delivering technology enabled business Business and technology consulting Systems Integration Application services IT outsourcing Business Process outsourcing IT infrastructure services Web Development and internet marketing Interim Resources and subject matter experts 15. Technologies SWOT AnalysisStrengthsWeaknessesM Operational L Over-reliance on UKexcellence to delivereconomyH GDM M Limited position in Capability to attract & value chain (i.e. NoLSignificancekeep talentspresence orof ImpactMrelationship with Strong relationship H consulting business)High M MediumH More cost/speed H Wage inflation due tocompetition on talents LLowconscious customersM Market growth (15+% / year)M H Newer disruptive Higher awareness on business models (i.e. Out Sourced modelweb services, web 2.0)OpportunitiesThreats 16. SWOT ANALYSIS Strengths: Enhanced competitive edge Indian based operations Low labor costs, high relative rates of inflation Relatively high skill levels in IT Extremely strong position Brand respected across the world Varied Domains of Businesses foray into productsand services 17. SWOT ANALYSIS ( CONTD ) Weaknesses Occasionally falters to secure contracts in NorthAmerica missing out on lucrative business Small player as far as global players are concerned Multi cultural environment Business consulting practices dominated by majorplayers like Accenture and IBM Word of mouth marketing of offering Lack of expansion Outsourced offshore resource 18. SWOT ANALYSIS ( CONTD ) Opportunities Lucrative expansion options in China European and North American companies tooutsource a portion of BPO /ITO operations Provides outsourcing and Cost reductionstrategies help clients during global recession 19. SWOT ANALYSIS ( CONTD ) Threats Move to offshore service companies incountries like China or Korea Has to compete for skilled labor may affectwage levels and retaining staff Competitors coming from China, Korea lowcost labor and adaptive to western practices 20. INTERNAL FACTOR EVALUATION MATRIX Internal Factor Evaluation MatrixStrength / WeaknessWeightRating Score1 Low labor costs20 4 0.8S2 High technology skills154 0.6S3 Strong financial position 5 3 0.15 S4 Global brand respected across the world 5 3 0.15 S5 Rich domain knowledge10 4 0.4SLow level of consolidation - highly6 fragmented5 20.1 W7 Staff retention and increasing wages151 0.15 W8 High Sensitivity to currency fluctuations 151 0.15 W9 Lack of consulting skills10 10.1 W100 2.6 IFE Matrix indicates that India IT Inc. is strong and it has done well,so far, to overcome its weakness 21. EXTERNAL FACTOR EVALUATION MATRIXExternal Factor Evaluation MatrixWeigh Opportunity / Threat tRating Score1 Expansion in lower cost countries 1510.15 O2 Continued Support 254 1 OHelp clients shape strategy to tackle global3 recession 1530.45 O4 Terrorism 103 0.3 T5 Competition from other low cost markets 202 0.4 TNew protective economic policy & hence6 reduced orders1510.15 T 100 2.45 EFE Matrix indicates that India IT Inc. is not responsive in exploiting opportunities and in mitigating the impact of threats 22. OUR CLIENTS 23. Registered Office: Enterprise House,PROVIDERS OF STRATEGIC STAFFING 21 Buckle Street, London, E1 8NN,United Kingdom. Company No. 05634821, Registered in England & Wales. DUNNS ID: 348355780. UK DDI: + 44 (0) 203 6035 - 358. UK FAX: + 44 (0) 203 - 6035 - 359.Mobile: 0709 230 1140Email: sales@flexibleresources.co.uk Copyright Flexible Resources Associates 1999 - 2012 - All Rights Reserved www.flexibleresources.co.ukManaged Service Provider 24. PROVIDERS OF STRATEGIC STAFFING Flexible Resources Associates . All rights reserved. Confidential and proprietary document.This document and all information contained herein is the sole property of Flexible ResourcesAssociates.. No intellectual property rights are granted by the delivery of this document or thedisclosure of its content. This document shall not be reproduced or disclosed to a third party withoutthe express written consent of Flexible Resources Associates . This document and its contentshall not be used for any purpose other than that for which it is supplied.The statements made herein do not constitute an offer. They are based on the mentionedassumptions and are expressed in good faith. Where the supporting grounds for these statementsare not shown, Flexible Resources Associates . will be pleased to explain the basis thereof.Interim Resources and Managed Service Provider

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