After
a high-level strategy has been determined, the next phase
of the engagement drills down into developing the solution.
Solution Development is based on three key elements: (1) Scope,
(2) Location, and (3) Configuration.
Scope
A detailed assessment of an organization’s functions
and processes is required to define and then refine the scope
of the sourcing endeavor. This serves to identify which activities
should be outsourced, which should be retained, and which
should be consolidated in a Shared Services Center (SSC) Further,
this exercise will uncover opportunities for process re-engineering
if necessary. It would identify the boundaries, the responsibilities
for inputs / outputs at each boundary, and the underpinning
rationale for the boundary being at each particular point.
Location
Each location is evaluated based on its suitability to the
nature of the work to be offshored. This evaluation includes
both the external factors present in each location and the
client-specific factors determined by the client’s strategy
and objectives. Extensive research and experience with both
the primary and emerging offshore locations enables Alsbridge
to provide our clients with information on external factors
to include:
- Costs – labor,
infrastructure, tax and compliance
- Labor Pool –
language skills, capability, availability, culture
- Infrastructure - telecom
& tech, business & social, transportation
- Business Environment
- economy, stability, legal, corruption, crime
- Process Quality - number
of providers, experience, availability
Each location must also be evaluated based
on its fit with the client’s short-term and long-term
goals. A company’s overall business strategy must be
considered to properly measure the intangible advantages and
disadvantages of a particular location.
Alsbridge regularly conducts location evaluations
for global clients and has in-depth knowledge of the full
range of viable offshore locations to include: Poland, Czech
Republic, Romania, Bulgaria, Spain, Germany, France, Netherlands,
UK, Ireland, Canada, India, South Africa, Philippines, Thailand,
Singapore, Japan, China, Latin America, Canada, the United
States, and Mexico. Our partners have operated in these regions
since the early 1990’s.
Configuration
Configuration is the culmination of the solution development
process in that once you’ve determined what will be
outsourced or moved to an SSC, and what location(s) offers
the most advantages, it is time to configure the in-scope
functions among the locations in a variety of combinations
to determine the client’s optimal solution.
Business Case
Building a solid business case founded on the true cost of
operations enables evaluation, refinement, and optimization
of the solution developed. Alsbridge produces a comprehensive
financial business case using FastModel™,
a proprietary future state financial model that enables us
to compare the current base case costs with a variety of future
states while accounting for external variables (e.g., the
devaluation of the dollar, increases in offshore wage rates,
unexpectedly high turnover, etc.). The business case generated
is expressed in the form of net cash required, NPV, IRR and
months to net zero on cash.
Based on this information and consideration of the client’s
short-term and long-term goals, financial situation, and overall
business strategy, Alsbridge will assess the impact of the
sourcing endeavor on the client’s operations and refine
the solution including the scope, timing, and sequence of
sourcing events.
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