The panelists shared their learning from business-transformation projects. At the most granular level comes the business process. A clear design of the business process as the first step would not ever hurt, the panelists were unanimous. In Wellpoint’s case where they had to unify multiple health plans and administer it from one system, a clear business-process design was critical. Whereas in McGraw Hill’s case, the business processes in print and electronic media had to supplement and complement each other.
The dilemma most often faced — call it the chicken and egg story of offshoring is — should business processes be improved first and then offshored, or should they be offshored first and then improved. While there is no single point of view on this, Tiger Tyagarajan, EVP, Genpact, suggested that the decision depends on the type of process in question. If the process is a customer-facing one, then it is a candidate for improvement before offshoring. Whereas any other internal process, such as accounts payable, could be offshored first and then be improved.
Building Global Sourcing Skills
The most challenging transition is that from being a doer to one remotely managing a team of doers in another country. It requires the development of skills in partner management that are different from leading an operations team internally. This is because managing deliverables is quite different from the process of delivery. Skills are transferable to a point, beyond which people have to be comfortable in the new role. Training would help in some areas, but not all. The other point is that the generalist can’t hold on forever — sooner or later domain-specific specialists would come to play larger roles.
Companies that have outsourced or offshored to leading service providers also complain about shortage of talent at the service provider end in terms of the quality of skills. This means that the issue of development of global sourcing skills is as severe for the service provider as the companies that seek the services. The uppermost questions are: How should they be trained; what skills should be imparted; is there scope for standardizing management talent for outsourcing.
Michael Corbett, Chairman, International Association of Outsourcing Professionals, admits that it is a long way before qualifications and skill sets for global sourcing reach standardization, but professes to have made some progress in that direction. “We are beginning to move in the direction of developing standard methodologies, common lexicon, and a standard body of knowledge in the area,” said Corbett. Till then, some of the good old career strategies like going a step outside one’s comfort zone, developing multifunctional skills, developing relentless flexibility to be able to deal with the unexpected, amongst others would help professionals grow to leadership positions in the industry.
According to Deborah Kops, Head, Program Planning and Development, SharedXpertise, it takes time for a company to realize that they need a global services management function. She likened it to an investor in one company’s stock and another one with multiple companies — the latter one would need a portfolio-management approach to maximize returns. Similarly, multiple projects that would require a transition from project to program, would drive the realization for a global services management function.
The PMO Factor
Having an effective and powerful Program Management Office (PMO) is the hallmark of a successful global sourcing program. The mission of the PMO is to identify, stimulate and support the utilization of best practices in project management according to Chance Curtiss, Sr. Director, neoIT. The role of the PMO is a dynamic one and it is both proactive and reactive depending on the situation. The PMO interfaces with groups in financial management, resource management, relationship management, contract management and performance management, but is not accountable to any of them. The PMO supports the project by providing project-management guidance through the development and implementation consistent standardized processes. The PMO lays down measures for accuracy of cost and schedule estimates, program stakeholder satisfaction, resource allocation, program approval gateway, and centralization and coordination of methodology and institutional knowledge. “The key takeaway is that for the person managing the PMO there are many levers available; it is important to understand which lever to pull and when,” said Curtiss.
