seamless nearshoring - itera's way
TRANSCRIPT
Seamless Nearshoring
Seamless nearshoringItera’s Way
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Seamless Nearshoring
• Vice President Global Outsourcing at Itera• Vice President, “IT Ukraine” Association• Scientific-Methodological Commission on Software
Engineering, Ministry of Education and Science of Ukraine• Co-founder of SoftServe, one of the largest software
house in Eastern Europe with1200+ personnel
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Igor Mendzebrovski, VP Global Outsourcing
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Seamless Nearshoring
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• Premium Nordic IT provider with nearshoring capability
Seamless Nearshoring: Vision
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Collaborative engagement model with a flexible split between on- and offshore
Experienced offshoring management team with proper QA layer of internal processes
Premium IT resources, cultural similarities, geographical proximity
Seamless Nearshoring
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Itera’s Hybrid Model
Nordic footprint
Sales, legal and financials
15+ years local market maturity
Critical business deliveries
Nearshoring arm
Premium ICT resources
Pro-active communication culture
Strong offshoring experience
Seamless Nearshoring
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Sourcing for Value vs. Sourcing for Volume
Maximizing efficiency (Value)• New/complex systems• Challenging projects• On/off-site resource balancing• Core business value
Optimizing utilization (Volume)• Repetitive businesses• Straightforward projects• Workload balancing• Complimentary services
Net realized savings ranging from 10% to 40%
Resource Pool| Sourcing for Value Sourcing for Volume
Salary level - SeniorSalary level - Junior
Same SameUp to 50 % less
Team size Compact, efficiency driven Larger, volume driven
Attrition rate >7% >14%
Governance & hierarchy Transparent & flat Low transparency and complex
Productivity High Less
Travel time & expenses Less High
Cultural match Very good Low
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The “Value” Parameters will give better business flexibility
Large pool, large spread
Less pool, less spread India
Ukraine
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Client Engagement Options
• SLA levels 1, 2 & 3• Long-term• High business value
Application Outsourcing
• Medium-term• Specialized teams• Discrete engagements
Project Outsourcing
• Continuous engagement• Managed by client
Team Outsourcing
• Fills in acute client needs
Consultants Outsourcing
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Delivery Framework
Engagements Models
Application Outsourcing
Project Outsourcing
Team Outsourcing
Consultants Outsourcing
Methodologies
SCRUM
Iterative
RUP
Software Development Approach
People Tools Practices
Seamless Nearshoring
• Focused on life tested practices
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Quality of Seamless Nearshoring
• Mandatory project practices are tailored to meet client’s needs
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Management processes
Project management
Quality Assurance management
Risk management
Configuration & Change management
Requirements management
Development processes
Business analysis
Software design
Software development
QA testing
Deployment
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Three ways to add business value to IT organization
Goal #1: Maximize sourcing flexibility• Deliver sourcing flexibility to local resource pool seamlessly
extended to nearshore (AD, AM, R&D, etc.)
Goal #2: Drive innovation and R&D• Drive product innovation & time-to-market by establishing product-
focused nearshore teams with scientific-research capabilities
Goal #3: Increase customer focus• Retain frontline strong focus on clients while conveying application
evolution, debugging, optimization and etc. tasks to nearshore
• Local team is extended with nearshore one focused on development and support in a knowledge intensive development environment
• Unified project framework is established, that facilitates knowledge sharing and collaboration between geographically distributed teams
• Easy to scale up or down• Minimum impact to efficient delivery and timeline due to possible rotation
• We call it “Hybrid Approach”, it is optimized for resource balancing for up- & down-scaling due to the organizational set-up with roles distributed more or less evenly (incl. knowledge sharing) across the shores (more like “staff augmentation” approach)
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Goal #1: Maximizing sourcing flexibility
AM and Support
BA and AD
Product 1 Product 2 Product m Product n
Hybrid (Local / Nearshore) team
• Dedicated nearshore team takes on existing or new product• Business and competitive analysis• R&D planning and executing• Next generation technologies and methodologies• Hi-level knowledge sharing (incl. product strategy, road map) is involved
• Product innovation approach is optimized for faster time-to-market within agile management / communication environment for relatively localized or stand-alone products or systems
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Goal #2: Drive innovation and R&D
R&D and support
BA and consulting
Product 1 Product 2 Product m Product n
Local team Nearshore team
• Nearshore team backs up local R&D by delivering hours intensive services like: refactoring, technology improvements, extensive QA, etc., – freeing more hours to frontline workers and client intensive developments and services. Competitive advantage is gained through:
• Strong focus on clients and markets• “Pure” R&D front office attracts talents• More hours to invest into robust, bug-free products
• Roles distribution in horizontal functional split is optimized for focused teams and efficient services / product delivery
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Goal #3: Increase customer focus
AM, fixing, tuning, etc.
BA, R&D, consulting
Product 1 Product 2 Product m Product n
Local team
Nearshore team
• Management Overhead - Caused by more complex, distributed Project Environment
• Communication Overhead - Caused by Distance, Time and Cultural differences
• Business Domain and Regulations Expertise - Caused by lack of necessary expertise in Outsourcing Environment
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Best Practices to Answer Outsourcing Challenges
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Collaboration Approach
Vision/Scope
• Define business needs
• Adjust pricing model
• Discuss QA scope
Analysis &
Planning
• Define Technology
• Transfer knowledge
• Feasibility study
• Adapt practices
• Detailed estimates
• Detailed plans
Pilot (s)
• Reasonable size and functionality
• Adopt communication habits
• “Post mortem” analysis
• Adjust practices
Optimi-zation
• Delivery framework integrated
• Quality Assurance & Testing
• Tools
Strategic asset
• Integrate into client’s processes
• Enhance value chain
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4 steps to outsourcing partnership include
• Business Case• Workshop in Ukraine• Align business expectations• Define key drivers
0:Initiation
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Geographical and cultural proximity
2.5 hours
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• 20+ years global outsourcing player
Ukraine Nearshoring Destination
#4 IT-resources pool in the world, followed after USA, India & Russia
TOP 15 IT-services exporter, globally
Long lasting traditions in fundamental ICT
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Geographical and cultural proximity
Geographical and cultural proximity
• Size: about that of France, population 46 million• Time zone: 1 hour ahead of Norway• Travel: 2.5 hour flight from Oslo, visa not needed for EU citizens• High cultural similarity, common historical roots
Resources
• #4 world largest pool of IT resources – 125.000 specialists *• 6% of world ICT scientists**• 348 Universities, 35.000 graduates annually in Technology & Engineering **
• 15,000 – B. Sc. Degree• 10,000 – M. Sc. Degree• 1,000 – Ph.D. degree
Focus and Expertise
• Research & Development• Hi-Tech Engineering
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Our Nearshoring Facilities
• Co-located with Microsoft Ukraine in Kiev
• Appealing workspace
• Attracts talented people
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• Nearshore Development Center (NDC) structure combines Production and G&A
• Production is services or business lines: Engineering, Operations, QA etc.• G&A secures governance, legal, financial and etc. services for ODC
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Itera Ukraine Organizational Structure
General & Administrative
EDEngineering
SOService Operations
QAQuality Assurance
Country Manager
FINFinances&Accounting
PQAProcess QA
HRHuman Resources
SASystem Administration
O&SOffice & Support
Production
Project Team
Project Team
Project Team
Project Team
Project Team
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• Sourcing for Value, not for VolumeMaximizing efficiency instead of capacity only
• Flexibility of a Hybrid ModelCombine on- / near-shore resources for your best result
• Best Offshoring PracticesLearn from other’s offshoring outsourcing lessons
• Do More For LessRemove budget strains & optimize your costs
Summing Up
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Looking forward to work with you!
We heartily invite you to visit Ukraine