Last month, I attended the International Association of Outsourcing Professionals (IAOP) Outourcing World Summit in Phoenix, Arizona. I had the chance to glean fresh insights from industry-leading practitioners and get a global view from sourcing executives.
Though there has been an evolution in the outsourcing industry, one thing has not changed: outsourcing is a winning strategy. In the recent study from IAOP & Information Services Group (ISG) Annual State of the Industry 1 presented at the event, it stated that “Multi-sourcing as an outsourcing approach increased by 75% from last year’s percentage”. The predictions for 2015 also show continued growth: “51 percent of respondents in the survey said they expect to pursue more outsourcing opportunities during the year”.2
Multi-sourcing - where a customer uses several service providers to provide a single scope of outsourced services, is now the new norm in outsourcing. In today’s organizations, outsourcing is increasing and each additional outsourcing agreement makes it more difficult to holistically manage IT service & support.
A new way of thinking about SLA’s is required to make multi-sourcing effective
Service-level agreement (SLA) management is the process of negotiating, defining and managing the levels of IT service. SLA management is a key challenge that organizations face as part of outsourcing and it is becoming increasingly difficult with multi-sourcing.
Most organizations invest heavily to define SLAs. If you talk to the service tower owners themselves, fewer than half have know what SLA’s are actually in the contract. They also cannot recall all of the specific details that the increasing numbers of the agreements contain. So, there is a lot of work that goes into developing these structures but there is no framework established on how to govern them in an automated way.
As a result, most SLA management is reactive. Periodic reviews between buyer and vendors are based on summary performance data from the prior period. Data from vendors is typically inconsistent and inaccurate. I was speaking with a sourcing executive at a large financial services company a couple of months ago, and she reported that half of the meeting time spent with vendors on performance was used just to agree on what an accurate view of the data was. This hardly aligns to the dynamic nature of business today.
New Paradigm on Thinking about SLA’s
Imagine the ability to manage SLA’s with each of your providers in real-time with one service integration framework. In a workshop we held in New York with a number of large buyers and providers late last year, they highlighted that this would not only move the service management model from reactive to proactive, but would also enable a more collaborative working model – moving away from the “us vs. them” paradigm. In one multi-sourced organization we’ve implemented this model in, it has completely eliminated after-hours escalation calls and dramatically reduced resolution times. With an active SLA capability you can manage all of the multi-sourcing relationships from one “pane of glass” and get accurate service information in real-time, such as:
- Overview of all your open cases per provider
- Cases trending towards SLA violation that you can proactively take action on
- Actual violations that require immediate attention
To be effective, this solution would need to be very easy to consume, showing only what really matters up front. Front-line managers don’t have time to browse hundreds of tickets when only looking for one affecting the SLA. This all sound promising but is it possible to achieve?
Transforming multi-sourcing with active SLA’s
We are pleased to announce the availability of Active SLA Management in the 7.0 release of Cisco ServiceGrid. With a highly innovative user experiences via a centralized dashboard and reporting capability for the connected multi-sourced ecosystem, you will gain real-time visibility & drill-down functionality for events trending toward or violating SLAs to enable a more proactive, end-to-end vendor management capability.
If you would like to know more, feel free to browse:
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- Annual State of the Industry Jagdish R. Dalal, IAOP
- Outsourcing 2015: Changing in a Good Way – Contributor: ISG Research, February 2015
Tags: Governance, ITSM, outsourcing, service level agreements, service management, ServiceGrid, SLAs
I had the opportunity to attend Cisco’s annual Partner Summit last month and I am excited about the news announced at the summit as well as the valuable conversations I had with our partners. The reoccurring topics I heard included cloud, innovation, speed, scale and, most importantly, differentiation.
The partners I spoke with viewed exceptional service as a key enabler of future growth. As solutions get ever more complex, partners increasingly look to services as their key competitive differentiator.
Partners have a unique opportunity to leverage recent Cisco investments in software enabled services to enable differentiation. In discussions at Partner Summit, one question came up time and again:
“Customers are demanding more complex solutions, but they want a simpler support experience – how do we balance these seemingly competing objectives?”
Multi-vendor solutions are by their nature complex. Integrating support across these disparate components enables partners to create a simplified support experience – speeding resolution times and increasing transparency across the support process. Customers also look for integrated SLA’s, no matter how many parties might be involved in delivering support.
By connecting all service partners in the cloud, partners can deliver a unified support experience, opening new opportunities for partners to provide differentiated services. Better still, this “ecosystem” of connections in the cloud enables automation of IT service management and better exchange of support information between providers and customers for faster mean time to resolution for IT issues.
One partner at the forefront of this new paradigm is BORN Green Technologies of Switzerland. I caught up with Patrick Spreng from BORN at Partner Summit. He told me about BORN customers who had visibility into multi-vendor support processes they’ve never had before, using Cisco ServiceGrid. What had previously seemed an unmanageable mess created from a highly fragmented environment was brought together into a single support experience – with one overall SLA. On a daily basis, Patrick reported, it just made support easier.
Services will continue to grow as a major competitive differentiator for partners. Partners that embrace new models and innovate in this space will win new customers. Nowhere is this more important than in managing the growing complexity customers are facing every day.
Watch our interview with ATP Partner BORN Green Technologies to learn more about how it is leveraging the power of Cisco ServiceGrid:
Tags: Cisco ServiceGrid, cloud, interview, partner, ServiceGrid, support
Cloud providers justifiably tout the ease and speed in which services can be implemented, but behind the curtain a dark reality lurks. “Easy on” is a key selling feature of cloud services and for good reason. I well remember leading enterprise application implementation projects in the pre-cloud era. The initial thrill of taking on a major new initiative that could transform the business was quickly overcome by the stark reality of years of highly complex work before going live, only to find out that you were several releases out of date and needed a multi-million dollar upgrade!
In my first major cloud project (to deploy a cloud service management application to 16,000 service engineers) we had users up and running in a couple of months. The business began seeing results quickly and as the software was upgraded we gained advantage of new features immediately. Soon after implementation, we began experiencing problems. It turned out all of the support and operational complexity had been masked from us. Behind the simple outward appearance lay dozens of different software, hardware, data centers and networks. The cloud service provider took first support calls, but getting issues resolved took a long time – and worse, we never were quite sure who was currently working the issue or the status.
Recent studies have identified service and support as the number one decision criteria for customers purchasing new cloud services. In fact, one recent study of the SMB market for cloud services found that the TOP THREE concerns were service related:
- Provide an SLA to ensure application is accessible at all times (53%)
- Provide 24×7 customer support (47%)
- Provide better notification of upgrades, changes and downtime (45%)
Much as cloud providers would like to address these concerns, it’s very difficult operationally to do so because of the multiple back end providers. Cloud customers, in turn, typically use phone, web or email interface with cloud providers to raise and get status on service incidents, so they have no real-time or proactive visibility into issues or outages. As companies put more mission critical applications into the cloud, this dysfunctional support model is causing growing concern and slowing the adoption of cloud services.
Cisco believes the answer is simple. No matter how many different providers might have to get involved to solve a problem, to the original customer it should look like one organization. All information, data and workflows would be shared in an automated way, eliminating manual practices and bottlenecks.
Cisco ServiceGrid enables such integration with a “connect once, connect all” approach, integrating all participants in the support process to the cloud platform only once, instead of integrating everyone one at a time. In speaking with customers who have moved to such a model, they report 40% or more reduction in case resolution times and lower support costs. More importantly, the end user sees what’s happening on the case while it is happening – no finding out hours or days later – resulting in real time SLA’s.
The promise of cloud is incredible, however, cloud customers and cloud service providers need to recognize and address the growing concern about how it will all be supported. Together we can remove a powerful obstacle to cloud adoption, by adding an “easy button” for multi-party support.
source: Techaisle SMB Channel Partner Survey 2012
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Multi-Party Support – The Emergence of a Dynamic Support Network
Tags: Cisco ServiceGrid, cloud, cloud challenges, cloud services, multi-party support, service delivery, service integration, ServiceGrid
When I ask IT executives how happy they are with their external support providers (outsourcers, vendors, etc.) invariably they express deep frustration. They look to these vendors to be real partners – to collaborate effectively and seamlessly, to do their job efficiently and transparently, and to bring real innovation to the table. Instead, they feel like they go into combat every day with these supposed “partners”. And, they say, it’s getting worse. But what has changed?
Over the past several years the number of support providers IT organizations deal with has increased exponentially (one analyst firm estimates a 400% increase over five years). Moreover, the complexity of the relationships is growing – no longer are support transactions limited to just one partner, in many cases incidents bounce between several different partners before they are resolved. Then there is cloud. Cloud makes consumption easy, but hidden behind this “easy on” experience is a highly complex support reality. Cloud services might look like one unified solution when they’re purchased, but in reality cloud services incorporate software, hardware, data centers, and networks from dozens of providers – when something goes wrong, it isn’t easy to even figure out where the problem is – let alone get it fixed.
But the paradigm for managing these relationships has stayed basically the same for decades. At the end of the month vendors provide reports on their own performance. Most IT organizations have teams of people that sift through these reports, consolidate them into spreadsheets, summarize and analyze. This reactive, long lag time model doesn’t support the business need for flexibility and agility.
Cisco believes what IT needs is a “dynamic support network” – whereby IT organizations have real time connections to support providers – all linked back to the system of record IT relies on to manage support. It shouldn’t be sufficient to find out at the end of the month that target SLA’s have been missed – IT needs to know if the SLA on the incident that is open NOW is going to be missed, allowing it to proactively ensure it meets the SLA.
Interestingly, when I talk with external support providers like outsourcers or managed service providers, they have exactly the same requirement. They want to see the incident they are working on from the point of view of the person who originally opened the ticket, not just from when they were brought into the process. They truly do want to partner – and in fact to delight – their customer. They recognize the customer is ultimately the end user, and it is the end users expectation they want to manage to. To accomplish this, they need to be integrated with their customers – their own dynamic network – with real time visibility and transparency into when the incident was raised, the original SLA, what has already happened on that incident, etc.
Cisco ServiceGrid is designed to solve this problem. With a “connect once, connect all” approach, ServiceGrid integrates all participants in the support process to the cloud platform only once, instead of integrating everyone one at a time. It allows companies to collaborate in real time to deliver services to a single customer. All information, data and workflows are shared in an automated way, eliminating manual practices and bottlenecks. From a customer perspective it looks like one company, even if two or more companies are working together to solve a case.
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Tags: Cisco, cloud, dynamic support network, IDC report, outsourcing, ServiceGrid