Marketing plans are reference materials to see when a company is in search of the various measures that can be achieved on the track and place of their raw materials and goods. A word of caution though, not all marketing plans can contain positive aspects that people are looking for in line with the direction that the company can expect if moving. Powers convincing and show concrete results through examples or illustrations appropriate guidelines and flowcharts for the decision making body of an organization that is sure to be good and effective enough to manage to go to the address to which the plan addresses proposed marketing. Marketing plans are of various formats, and as applicable, analytical people and rightly so in order to understand the essence of the entire report and what you are looking for. It can contain different things concerns, such as: 1. Niche market 2. Pricing strategies 3. Market Segmentation 4. Market Concentration 5. Market attraction to their customers or target market possibilities are endless, and although not all are covered in the odds listed above, a marketing plan contains the most essential keys are designed to help the organization to achieve progress and be aggressive towards target market customers. More than a lot of words combined with graphs, financial projections and hypothetical analysis and recommendations and so on, the essence and what the author / s of the marketing plan targets will be the only thing that is for consideration and probably the arbitration, all for the good of the company as a whole.
Introduction
There are several compelling benefits when considering the use of offshore resources in ERP systems integration projects – reduced costs, access to a growing and talented workforce, 24 x 7 work days, shorter project lifecycles, and more. Systems integrators boast about their increasing offshore workforce, and they have to to remain competitive. The India-based systems integrators identified above are also becoming increasingly active the ERP space. Critics of sending work offshore say that communication costs increase, project managers don’t have as much visibility into project progress and that language barriers can cause confusion with respect to project goals.
The fact of the matter is that off-shoring components of ERP systems integration projects is on the rise, and this trend is not likely to change as long as it allows systems integrators to remain competitive in the marketplace. The real question, however, is what type of impact these offshore resources have the quality of delivery, and, ultimately, client goal attainment.
This article compares client assessments of systems integrator performance when offshore resources are part of the delivery model with those projects where they are not.
Offshore Delivery Model
In 2004 and 2005 approximately 45% of North American ERP systems integration projects utilized offshore resources as a component of project delivery. In 2006, the use of offshore resources increased by nearly fifty percent, with nearly two-thirds of projects including an offshore component.
There are notable differences, however, in the types of projects that incorporate offshore resources as part of the delivery model. For example, large budget projects, those with budgets exceeding $50M in total budget (hardware, software, and services) are most likely to include an offshore component. The trend of utilizing offshore resources in large projects is increasing, but is not new. In 2004 three out of five large projects utilized offshore resources, though it increased to four out of five projects in 2006.
Perhaps the most interesting trend in the table below is that use of offshore delivery models has doubled in the smaller ERP systems integration projects. As pricing pressures increase, systems integrators are more likely to leverage offshore resources for smaller projects to help keep prices lower and margins intact. As the systems integrators’ methods of deriving value from their use of offshore resources improve over time, they extend their use to more and more projects.
In addition to segmenting the results by budget size, this research studies the different types of projects clients conduct; initial implementations, upgrades, geographic roll-outs, and optimizations.
Initial implementations are the least likely to include offshore components. Follow-on projects, like upgrades, roll-outs, and optimizations, are more likely to include an offshore component.
Three-quarters of geographic roll-outs in 2006 incorporated offshore delivery components. One of the benefits of going offshore is that resources can be centered in any location around the globe. Systems integrators with resources in multiple locations assign local resources to many locations more easily (and affordably).
Change in Delivery Priorities
Client goals and delivery priorities vary from project to project, depending on their business challenges, internal skill sets, and type of project. When comparing the delivery priorities of clients with projects that include offshore resources with those that do not, the research reveals some interesting differences.
Clients whose projects include offshore components place a stronger emphasis on a provider’s partner network and delivery model. This is fairly intuitive – when offshore resources are used the client is more focused on the quality of resources, how and when these resources will be leveraged, and how the provider intends to manage these resources.
When looking at client’s delivery priorities, staff quality ranks third overall among clients whose projects include offshore resources. That said, this research reveals a reduced level of importance when compared with projects that do not include offshore resources. The interpretation is that offshore resources can be viewed as a ‘black box’ that clients can’t see into. The work is assigned and delivered, and the scrutiny of the people doing the work is lessened because the resources are ‘invisible’.
What is interesting is the decreased focus on knowledge transfer. The effective transfer of knowledge from the systems integrator to the client is important for the client to be able to maintain and use the systems in the post go-live environment. The increased focus on post-implementation planning and industry focus (the application of industry best practices) suggest that a stronger emphasis on planning reduces the requirements for the specific transfer of knowledge to users and technical staff. In other cases, clients may be willing to trade off the advantages of effective knowledge transfer for reduced fees, and are willing to proceed at their own peril in this respect.
Impact of Offshore Resources on Project Delivery
A variety of metrics are used to measure systems integrator performance. Two of these metrics are the Overall Performance Score, which describes the delivery experience across the project lifecycle, and Overall Goal Attainment Index, which is a measure of the effectiveness of the integrator in meeting their client’s expectations for goal attainment.
The Overall Performance Score runs from a low score of one (1) to a high of ten (10). The Overall Goal Attainment Index runs from a score of one (1), meaning Falls Far Short of Expectations, to a high score of five (5), which means Far Exceeding Expectations; a score of three (3) means Meeting Expectations.
Comparing projects with and without offshore delivery components reveals that there is no difference in project delivery or client goal attainment when offshore resources are used. When asked specifically about the impact offshore resources had on their projects, five out of six indicate the offshore resources contributed positively to the engagement. Our interpretation of this finding is that systems integrators in general are effective at identifying which projects should and should not include offshore resources. Further, they are effective at identifying the specific tasks that can be off-shored without a negative impact on the project. This highlights the relative maturity that already exists in the market around the use of offshore resources to support ERP efforts.
While the overall numbers confirm that offshore resources can be effectively deployed without negatively impacting the quality of delivery or client goal attainment, digging deeper into the data reveals that offshore resources can be better leveraged for specific types of ERP projects.
The tables below segment SAP and Oracle projects by budget size. As a first level of comparison, projects with larger budgets see the greatest performance improvements while small budget projects generally do not realize overall performance increases from offshore resources. On average, medium-sized projects aren’t impacted in terms of project delivery but do see improvements for goal attainment.
Small projects have seen the greatest increase in the use of offshore resources, but this research reveals that projects of this size do not reap the benefits that larger budgets do. Clients with projects within this budget range should fully understand how a provider’s methods have been adapted to ensure that offshore resources will not be a detriment to the project.
Comparing Oracle and SAP projects reveals some interesting differences as well. SAP projects tend to see a greater benefit from utilizing offshore resources. This is especially true for the large budget projects. Oracle projects with budgets in the $5M – Better Performance At A Cost
Better performance comes at a cost, however, as the management required to coordinate multi-time zone projects can create additional headaches for project managers. This research studies fourteen different problems that are typical of ERP systems integration projects. Comparing projects with and without offshore components reveals that each of the fourteen problems is more likely to occur on projects where offshore components are utilized.
Four of the more common problems are related to the management or expertise of project resources: deficient management of resources, personnel not to expected levels of expertise, lack of agility, and deficient process and/or scope management. Knowing that these challenges exist, buyers need to weight these risks against the benefits of lower costs of using offshore resources. Further, clients should be sure to make contingency plans in case issues arise.
Problems related to effective measurement are more prevalent in projects that utilize offshore resources. While clients do place a stronger emphasis on planning components when utilizing an offshore delivery model, clients must define measurement programs in advance to ensure they will be able to capture the relevant metrics identified.
In summary, clients need to fully understand which phases of their projects will include offshore components. Clients should not be bashful in asking their integrator about the qualifications of the staff working on their projects, and the integrator should be able to communicate the process for transferring relevant information to technical teams and end users, where appropriate. Finally, clients should understand the change management processes and guidelines to ensure appropriate levels of flexibility, should it be necessary to make course corrections along the way.
Systems Integrator Performance
Among the leading ERP system integrators, Accenture and Deloitte have utilized offshore resources most frequently over the last few years, though BearingPoint and Capgemini have recently begun including offshore components in more of their projects recently. IBM also has extensive offshore resources capable of being deployed. The consulting divisions of Oracle and SAP tend to go offshore least frequently.
When evaluating any systems integrator’s offshore delivery model, clients should fully understand the volume of offshore resources available, at which phases of delivery they will be deployed, and what their respective skills are. Stakeholders involved in the project day-to-day should understand the channels of communication when offshore resources are being used, and how to escalate issues to the systems integrators leadership should issues arise.
Accenture and Deloitte clients report the most improvement in project delivery and goal attainment when offshore resources are included in the delivery model. According to these findings, these two integrators have a history of including offshore components in their projects more frequently than the other integrators, and perhaps this has helped them maximize the effectiveness of their offshore delivery methodologies.
The difference in performance when IBM and BearingPoint do and do not include offshore resources is negligible. The interpretation here is that both firms consistently manage projects and deliver value to clients regardless of the whether offshore resources are included or not.
Capgemini and CSC clients that leveraged offshore resources do not report improved performance and goal attainment. Capgemini’s performance improves for larger budget engagements, however.
The multinational pure-play systems integrators typically have separate lines of business for their SAP and Oracle practices, though their results are aggregated in this analysis.
Conclusions
Clients with ERP systems integration projects with projects above $5M are likely to realize improvements in project delivery and goal attainment by utilizing offshore resources. Clients should expect decreases in systems integrator agility and additional challenges in training technical staff and end users.
Clients with smaller ERP projects are less likely to see improvements in project delivery and goal attainment as a result of using offshore resources. Clients should expect to see offshore delivery models in RFP responses, as systems integrators are becoming more and more likely to include offshore components to stay competitive. Clients should fully understand at which phases of delivery integrators intend to send work offshore.
Not every ERP systems integrator has proven to consistently leverage offshore resources for the benefit of the engagement. While certain project tasks can (and perhaps should) be off-shored, clients should fully understand each integrators methodologies when off-shoring is included. Multiple references for similar projects should be interviewed specifically to understand the change management and knowledge transfer processes, as well as to gauge the quality of the personnel doing the work.
To view the graphics that go along with this article, please visit http://www.performancemonitor.net/mm.php?content=november_2007.
About This Research
This research is based on a market study conducted by Performance Monitor, and independent research firm. The results are based on 1,864 ERP systems integration projects completed by the leading multinational systems integrators, including Accenture, BearingPoint, Capgemini, CSC, Deloitte, IBM, Oracle Consulting, and SAP Consulting. Further, performance data on the following India-based systems integrators was captured: Cognizant, Infosys, Satyam, Tata Consulting Services (TCS), and Wipro. For more information, please visit www.performancemonitor.net.
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