Getting best comparative value from outsourced IT services

As outsourcing IT services becomes more prevalent, both onshore and offshore, there is an increasing need to monitor comparative performance with other similar contracts.  The best way to be confident of receiving service performance and quality at optimum cost is to benchmark either at key points or throughout the contract.  Benchmarking can achieve big savings for organisations using managed or outsourced services to deliver IT.

CPI OS covers services delivered in these areas:

• Desktops

• Service and Help Desk

• Data and Voice Networks

• Server Infrastructure

• Internal Customer Views
  
  

Key questions organisations must ask about outsourced IT contracts

• Are costs in line with, or lower than, the current market?
• How well is the incumbent service supplier delivering - in comparison with other similar contracts?
• Is cost/quality appropriate for services delivered, or distorted by supplier issues?
• Does outsourcing compare favourably against in-house service delivery?
• Are internal contract management costs and time appropriate?

The CPI Benchmarking Service for Outsourced Services (CPI OS):

• Designed to answer key questions at an economic cost that makes monitoring and improvement a viable proposition.
• Provides an easy way to measure individual managed or outsourced services in comparison to others.
• Allows organisations to monitor comparative financial, performance and quality indicators as part of good contract and service management, in a way that can be communicated to all stakeholders for each individual service.
• A flexible service that allows all or discrete parts of the IT function to be benchmarked either on a continuous basis or at intervals that match the organisation's requirements

CPI OS also brings benefits for those considering outsourcing, but wanting to assess the marketplace against in-house options before launching a potentially expensive tendering process.

Every outsourcing contract and IT environment is unique, but there are key factors that can be used to provide a common contract "scope" profile to enable valid performance and value comparisons to be made.  An example of a scoping factor may be whether assets are owned by the supplier or the organisation.  These factors have been selected based on practical experience.

CPI OS helps to ensure an effective relationship between client and supplier, while measuring the quality of service delivery at any time during the entire outsourcing lifecycle.

CPI OS: a different approach to benchmarking outsourced IT

Traditional benchmarking is expensive, resource hungry and inflexible.  It focuses on consultant-driven processes rather than cost, performance measurement and comparison.  CPI OS avoids these issues.

The emphasis of the CPI OS service is on Continuous Performance Improvement with an easily repeatable process requiring minimum effort.  However, it is equally effective as a one-off tool to evaluate value or performance at any negotiation point.  This may be before a contract begins, at a recognised break point, or at the end of an existing contract to determine if the supplier has performed well against market trends.  

Gain significant benefits from CPI Benchmarking for Outsourced IT Services

Motivation to benchmark with CPI OS for most organisations comes from tangible benefits including:

• Reduced cost

• Comparison between in-house and outsourced services

• Evidence during contract negotiation & service reviews

• Enhanced partnership with supplier

• Measurable improvements in service quality

plus qualitative benefits, such as:

• Comparative customer satisfaction demonstrable to the business

• Monitoring of customer satisfaction allows tuning of performance to meet internal customer needs.

No other service can deliver these benefits at such low cost!

Then CPI OS steps beyond conventional benchmarking:

CPI OS allows organisations to get under the skin of the data, to sort and sift on variables, in order to identify why a result is not as expected and to identify remedial actions.

By defining common denominators, CPI OS allows organisations to continuously monitor comparative financial and performance indicators against a common set of metrics that can be communicated to all stakeholders.

By facilitating the sharing of experience with other organisations that have similar
outsourced contracts, CPI OS helps organisations to identify actions that will lead to performance improvement.  CPI OS achieves this through workshops and brokered discussions that explore real world experience to develop best practice.

CPI OS can help monitor and compare service delivery against costs on a regular basis.  This leads to a transparent relationship with the supplier and helps to build trust and confidence. 

The CPI OS Process

A strength of CPI OS benchmarking lies in the ability to define the scope of the contracts compared in the results model.

Compare managed services with either a broad range of similar services across many organisations, or precisely with a particular service profile defined by the service scope.

The unique ability to discuss relative performance and best practice with others means that CPI OS supports the identification and the initiation of actions that make a positive difference.

International

CPI OS offers great flexibility to organisations operating across international boundaries by offering currency conversion using appropriate exchange rates. 

Group Organisations with multiple IT functions

CPI OS can also be applied to groups of companies to provide an internal benchmark as well as outside comparison.  It enables companies or IT functions within a group to compare outsourced service performance on a consistent basis throughout the group. This helps to ensure best practice and consistent service levels across all business units.

A simple process for gathering data

Participants complete the standard CPI OS data capture template from their own contract scope, plus other metrics which focus on the cost, performance and quality of the service being delivered.

Metrics have concise definitions that are typically available and in use in managing the outsourced service.  This means low collection effort and fast turnaround of the results.

At the beginning of the process the CPI OS team provide onsite support workshops to guide personnel in understanding terminology, definitions, and requirements.  Telephone support is available throughout.

Data validation to ensure consistency

Integrity and consistency are paramount to successful benchmarking and CPI OS checks metrics and outliers both automatically and manually to maximise consistency and minimise errors.

Help with results analysis

The CPI OS Results Model is very easy to use.  Nonetheless it helps to have access and support from the CPI OS team of experts and other participating organisations that can assist in the production of the Management Report.

Key information for management

The CPI Results Model includes an Executive Summary that is immediately accessible for presentation to senior management.  In order to get behind the data, the model includes analysis, charts and pivot tools that enable drill down into the rich seam of data to find specific areas of interest.

Workshops - analysis to actions

CPI OS takes full advantage of its ability to provide direct, peer to peer interaction with organisations that have experienced similar issues.  This ensures actions are based on real world, practical knowledge that allows faster, more confident decision-making.

CPI OS workshops are designed to generate actions that enhance managed service delivery and supplier relations.  It is this ability to get behind the numbers, to identify serious opportunities for sustainable improvement that makes the service so valuable.

CPI OS - Internal Customer  Views

In addition to tracking managed services, CPI OS additionally provides the opportunity to monitor and compare the results of actions, measured against the level of customer satisfaction achieved.

Participants can utilise the CPI Internal Customer Views Survey tools, or their own survey processes, to measure internal customer satisfaction, the gap between expectations and performance, and then to benchmark the summary results.

The specific needs of two distinct customer groups are addressed by tailored questionnaires:

Business Managers/Directors whose business operation is impacted by the quality of IT services.
End-Users where IT services determine the ability to perform everyday tasks efficiently. 

The core survey questions embody the industry standard RATER framework, ensuring they cover the key service dimensions: Reliability, Assurance, Tangibles, Empathy, and Responsiveness.

This has the benefit of giving organisations the information they need to target their investment on specific areas, and to measure the outcome.

Combining such survey results with managed service measures offers a complete view of performance and how the delivery of IT services can be improved to align with business needs.

CPI OS Results Model

Desktop Outsourced Support Metrics

In the executive summary compare how fast problems are fixed.  Is performance related to the complexity of systems supported?  Then use the Results Model tools to analyse in more depth.

Satisfaction Measures for Outsourced Services

View at a glance whether satisfaction with the outsourced service is typical of the industry.

CPI OS - The Benefits

Reduce Costs

CPI OS provides the intelligence to improve service delivery, performance and negotiate more effectively.

Unique Insights

Meet with other participants to get behind the data.  See where results differ from other organisations and discover the reasons behind the differences.  This helps to identify the changes required to improve managed IT service delivery.

Economic & Flexible

CPI OS provides effective benchmarking at a fraction of the cost of many other benchmarking services.The flexibility of the process ensures that the organisation can benchmark one or more managed services throughout the year, and own the process.

Real, Practical Help

Participants work with "Right Now" data from major organisations of a similar size and operating in comparable market conditions.