siac vendor management office robert durso director - vendor management office october 8 th 2002
TRANSCRIPT
SIAC Vendor Management Office
Robert DursoDirector - Vendor Management OfficeOctober 8th 2002
Mission
Expand and improve the use of third party vendors throughout the NYSE and SIAC
To improve time to market capabilities
To augment technical and domain competencies
To improve operational efficiencies and reduce costs
Vendor Management Office
Maintain Master Services Agreements (MSA) with Preferred VendorsMaintain Vendor Relationship & Qualify additional VendorsMaintain Program & Project Measurement MetricsProvide training workshops for Project ManagersAssist Project Managers in:
the evaluation and selection of projects,developing and evaluating proposals, statements of work, service level agreements and other support documents,monitoring vendor performance
Critical Success Factors
Careful Selection and Planning of Projects
Competencies of Preferred Vendors
Strong Support Mechanism for Project Managers
Well planned Knowledge Acquisition Phase
Close monitoring of Vendor Performance
Well Defined Outsourcing Infrastructure
Vendor and Project Selection
Selection Criteria
Vendor Selection CriteriaCorporate Profile – Revenue, number of employees, listingEnterprise Competencies or Boutique TechnologyDomain ExpertiseQuality Initiatives (CMM Level 3 or higher)HR PoliciesOffshore Development Center ExperiencesOffshore Contingency Plan and InfrastructureFlexibility, Reliability and Peer Organization References
Selection Criteria
Project Selection CriteriaProjects with resource constraintsProjects with clearly defined requirementsConversion ProjectsMaintenance and Enhancement ProjectsSupport Projects
Setting the stage for a successful launch
Offshore Feasibility Assessment
PROJECT EXECUTIONPREPARATIONKNOWLEDGE ACQUISITION
QUALITY ASSURANCE
USER ACCEPTANCE
PARALLEL RUNNING(PRODUCTION SUPPORT ONLY)
NEW DEVELOPMENTMAINTENANCETECHNICAL UPGRADES
An assessment should be performed prior to launch
Competitive Bidding Verification
Competitive Bidding - RFP's will be sent to preferred vendors as is stated by SIAC Procurement and the Competitive Bidding Procedure.
Phased Bids - It is recommended that each project is broken down into smaller phases. Each bid response should include all associated fees for each phase. This will give us the ability to evaluate each Vendor's phased bid response.
Internal Verification of Effort*Cost - the VMO and the project managers will work together to calculate and verify bids by estimating effort and multiplying by Fees within the MSA (Exhibit F - "Fees".).
Project Management Workshops
Course is a scaled down version of a 3-semester hour graduate level software engineering class offered by SMU.
It builds on the best practices from both Government and Industry to provide Project Managers with essential information needed to either solicit bids for a development project or to respond to a request for proposal (RFP) for a development project.
It introduces the Project Managers to the most common legal issues that are encountered in a software acquisition.
Managing the Metrics
Five Views For Managing The Program
• Measuring Organizational Commitment
• Measuring Project Status
• Measuring Time-to-Market
• Measuring Skills Augmentation
• Measuring Costs
Measuring Organizational Commitment
Project Name Assessment Score Projected Start Date Vendor(s) Bidding
In Pipeline
Active Projects
Pro
ject
Siz
e
5
10
15
20
25
30
35
40
45
50 Off-Shore
Onsite
Vendor Data
Vendor A:• No of Projects:• $$ of Projects:
Vendor B: • No of Projects:• $$ of Projects:
Vendor C:• No of Projects:• $$ of Projects:
Vendor D:• No of Projects:• $$ of Projects:
Portfolio Data
No. of Engagements =
Type of Projects• Development =• Maintenance =• Technical Upgrades/Conversions =• Other =
Total FTEs Under Program• On-Site = • Off-Shore =
Total $$ Committed to Projects =
Total $$ in Local Equivalent =
Total $$ VMO =
% Offshore $$ to IT Budget =
Project Name
Project Name
Project Name
Project Name
Project Name
Project Name
Project Name
Project TypeVendorProject Phase
TOTAL
Measuring Project Status
Project Type:
Technologies:
Project Phase:
Scheduling Variance:
Resource Variance:
Vendor Costs To Date:
Original Vendor Budget:
Revised Vendor Budget:
Major Achievements
Aug- {Replace with Major Achievements either for current month or previous months.
Sep – {This section is indented for 7 characters.
Outstanding Issues:
{Replace With Outstanding Issues}
{Insert Major Statement Regarding Project For Current Month}
Project Name/Vendor NameProject Description: {Replace with Brief Project Description}
Business Objective: {Replace with Cost Savings, Revenue Generation, Compliance, Governance, Quality}
0%
0%
$50,000
$100,000
$400,000
Project Type
Technology Type
Project Phase
0
2
4
6
8
10
12
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Pro
ject
Siz
e
Onsite Off-Shore
Actions To Accelerate Throughput And Measuring Their Impact
• Re-engineer Delivery Process
• Adopt a “Service-Based” Requirements/Design Model
• Employ Parallel Development Process (24x7)
• Add additional resources, I.e. Skills/Staff Augmentation
Actions Measurement
• Backlog Size
• Backlog Duration
• Average Elapse Time for Work-Unit, e.g. Function Point
• Elapse Times against Fixed Delivery Time-frames
Measuring Time-to-Market
Measuring Skills Augmentation
• Local Staff Augmentation versus Offshore Staff By:
• Environment Work (Mainframe, Internet, Client/Server, Other)
• Project Type (Development, Maintenance, Upgrade, Conversion, Other)
• Skills Mix (SAP, COBOL, Websphere, C/C++, Other)
• Functional Area (Administration, Trade Support, Q/A, Other)
Offshore Functional Area
Other7%
Upgrades13%
Maintenance27%
Development53%
Local Staff Augmentation Project Type
Trade Support26%
Q/A10%
Other7%
Administration57%
Example for Measuring Cost
[T & M]Gross Billing Savings = (Local Equivalent Rate x #Man Days/Hours) – (Vendor Rate x #Man Days/Hours)
[Fixed Price]Gross Billing Savings = (Local Equivalent Rate x #Man Days/Hours) – (Contracted SOW)
$1,000,000
$500,000
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
Cost $2,600,000 -$300,000 -$750,000 $1,550,000
Gross Billing Savings VMO Costs Other Costs Net Savings*
Outsourcing Status
Offshore Status
6 Active projects at the NYSE with 3 Off-Shore VendorsMaster Service Agreement negotiated with several Off-Shore VendorsMSA Supporting Documents Available
Request For Proposal TemplateStatement Of Work TemplateSOW Change Request DocumentService Level Agreement Template
Project Evaluation & Cost Analysis Template developedVendor Management Office Intranet Site
Speed to Market 2 time-zone prototyping Strong Project Management coupled with CMM Level 5 company Active defect containment measures
Skills Augmentation Ramped-up 25 skilled developers in 6 weeks
Resulting Time and Cost Savings18 modules, with significant process re-design 10 monthsApproximately 50% Gross Billing Savings (excluding transition, communication and other overhead costs)
Measuring our Mission1 Project - Requirements through Implementation
Measuring our Mission1 Project - Requirements through Implementation
VMO Lessons LearnedVMO Lessons Learned
Senior Level SponsorshipDefine a Clear MissionCommunicate and Educate Early and OftenDefine VMO Infrastructure Early (Even before first pilot)Continuous Process ImprovementEstablish Achievable GoalsDefine Program/Project Metrics earlySolid Risk Management StrategyPlan Transition in/Transition Out for all projectsVMO ease of use is as important as a delivery model
SIAC Vendor Management Office