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Datacraft bets big on multisourcing

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CIOL Bureau
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Datacraft India Ltd., part of the Dimension Data group, is betting big on outsourcing.

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Scott Petty, Group Executive (Services), Dimension Data, spoke to R Jai Krishna from CyberMedia News about his strong belief that multisourcing is next big thing waiting to happen in India.

Petty, who given his extensive and in depth understanding of the economics of the technology industry, also said that critical contribution of services is an essential component of the company’s overall value proposition.

He added that the company will introduce solutions to leverage on the multisourcing model in the Indian market. Excerpts:

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What is the multisourcing market potential in India? What drives the market?

Divestiture of non-core business processes allows the organization to focus on more important matters, make better use of skills, mitigate risk and in certain cases, reduce costs is a well known fact. However, recent years have seen significant changes in the way organizations approach outsourcing i.e. by opting for selective sourcing or ‘Multisourcing’ models, where select functions are retained in-house and certain functions are outsourced by employing a variety of ‘best-of-breed’ Service Providers.

Today the option of relying on a single provider has become less attractive for many reasons: The expected reductions in IT spend are not being realized, there is no alignment to business objectives and more often than not, the relationship contributes little in terms of innovation and thought leadership. Today, organizations are demanding more from their outsourced Service Providers and are seeking more of a partnership where common goals and aspirations are targeted.

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By employing a variety of ‘best-of-breed’ Service Providers, organizations are seeking to enjoy greater agility and reap competitive advantage.

As per findings of Data Monitor the percentage of multisourcing deal has gone up from eight per cent in 2003 to 20 per cent in 2005.

What are the targeted verticals and how does Datacraft want to leverage on multisourcing?

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We are targeting verticals such as BFSI, manufacturing, ITeS, Travel and Tourism, and Media and Communication in India.

At Datacraft, we recognize the new expectations stemming from the multisourcing approach. We understand the need for greater collaboration and focus upfront on preparing the ground for a solid and mutually rewarding relationship between ourselves and our clients.

When adopting a multisourcing model, the development of a ‘partnership’ relationship between client and supplier, based on trust and focused on mutual business outcomes is key to the success of the contract. This model requires organizations to adopt a new attitude toward Service Providers as strategic partners – not just as vendors from whom goods and services are procured, but as business partners with experience, skills and assets that can be harnessed to create competitive advantage. Service Providers, in turn, must be prepared to work to better align their services and contracts to their clients’ unique needs.

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One way of achieving this is by adopting a service model that involves us working closely with our client’s people in a blended team, thus becoming a true ‘trusted partner’. Often, traditional sourcing relationships become strained due to fears on the part of the client relating to loss of knowledge and intellectual property, as well as loss of career development opportunities for their internal staff. Datacraft, through its blended team approach, partners with and grows the client’s staff professionally, thus avoiding any concerns about loss of knowledge and increased staff turnover.

We will engage with clients at any particular point that suits their business needs. Our relationship with Vodafone in Australia, illustrates the flexibility of our approach. Our collaborative offering with the world leader in technology, Cisco, further strengthens Datacraft’s position in the market. Through the Global Services Alliance we are able to offer clients market-leading services that cover critical areas of their operation, ranging from technology selection and Support Services, right through to our higher-value collaborative Manage, Improve and Innovate Service offerings.

The development of its enhanced and flexible Services Continuum propels Datacraft into a position of strength in today’s services-driven environment. It also demonstrates our understanding of multisourcing principles and our ability to construct service offerings that are aligned to changing client procurement models in the changing sourcing landscape. This is particularly relevant considering changing client behaviors and expectations regarding infrastructure investments, and how best to Manage the associated costs.

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What are the products and solutions that Datacraft will be launching for enhancing the multisourcing market?

Historically our service functions included Plan, Build and Support. The Plan and Build Service functions are discrete or Professional services. What we have recognized from client feedback and the emerging market trends discussed earlier is that there is a need for us to provide an enhanced capability in the Manage Service function, where we take more accountability and more responsibility for the service processes and Service Delivery than in the traditional Support Service function. In response to this need, Datacraft has enhanced its Services Strategy.

Our extended Continuum of Services now includes Manage, Improve and Innovate Service functions, which encompass both discrete or Professional services and continuous or managed services. This does not necessarily mean moving away from technology related services, but rather being able to offer process related services that complement those technology related services.

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We will be offering the Right Measurement Tools with effective measurement techniques are critical to establishing a ‘trusted partner’ relationship between clients and Service Providers, to meet the SLAs.

Added to it is our Supplier Management Skills, as achieving healthy client/supplier relationships in the Multisourcing space is obviously not a one-way street. We will also be introducing Shared Risk/Reward Commercial Models, as we view shared risk/reward commercial models as an innovative way for clients and Service Providers to extract additional value from their partnerships, over the long term.

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