Leveraging Capabilities to Grow a Global Outsourcing Business

Executive Summary

A large, Asia-based multi-national organization wanted to leverage its legacy IT hardware and systems integration (SI) presence into an IT outsourcing (ITO) services business, capable of competing worldwide. This move was critical not only to meet corporate growth and margin goals, but also to establish a sustainable, defensive market share in the rapidly growing outsourcing market in its home country. The company’s core team of executives charged with leading the transformation engaged Everest Group to develop a go-to-market strategy for the new ITO business. Everest Group’s deep experience with large, global deals and its expertise in helping both buyers and service providers enabled it to provide the client with a detailed understanding of what it takes to win attractive business, a clear roadmap to build the capabilities required for success, and a comprehensive toolkit of best practices to support early success.

The Client’s Challenge

This leading technology giant, based in Asia, was experiencing a slowdown in its domestic IT hardware and systems integration markets. Its business leaders recognized that the company was also missing substantial growth opportunities in the region’s rapidly expanding outsourcing market. Moreover, direct competitors were capitalizing on the outsourcing trend and outpacing the market’s average growth rate. As result, the organization set aggressive targets to develop its outsourcing capabilities and grow a large outsourcing book of business nationally, regionally, and internationally.

Company leadership recognized there were significant differences between the organization’s core hardware and SI business model and the ITO services model. Increasing domestic competition was driving an imperative for decisive action to pursue, capture, and build the ability to market, sell, and deliver outsourcing services. The client acknowledged that a major change program was required to meet these needs, and turned to Everest Group to gain deep understanding of best practices in selling and delivering large ITO deals.

Insight to Action

Everest Group’s transformation agenda for the client was triple-pronged:

• First, Everest Group worked with key business unit leaders to inventory and benchmark the company’s capabilities that could be deployed into an outsourcing engagement against the best practices of global leaders
• Second, Everest Group initiated a program to define relevant best practice tools and methodologies that would help the client’s outsourcing-focused resources pursue and secure early market opportunities
• Finally, Everest Group synthesized the gaps in comparison to market requirements into an overall implementation plan to drive the transformation

The inventory and benchmarking effort required a robust construct that leveraged objective and quantitative evaluation of skills and capabilities. To support this, Everest Group developed a customized and proprietary best practices framework that covered all phases of the sourcing life cycle, from sales to deal governance and operations. Applying this framework, the Everest Group team conducted a comprehensive assessment of the client’s current capabilities. Benchmarking these capabilities and approaches against the practices of leading global service providers and best practices, the team identified areas that required attention and specific improvement initiatives.

The Everest Group team assembled an implementation roadmap to drive the client’s overall services business strategy, supplemented with capability-building workshops, best practice tools, templates, and frameworks to support execution and capability development.

Impact

Leveraging its depth and breadth of experience in advising buyers and service providers on shaping, structuring and selling (or buying) large IT deals that create value for all parties over the long term, Everest Group helped the client build a sustainable position in its target markets. The client set aggressive goals, including pursuing specific initiatives to quadruple growth in ITO services within three to four years. It is rigorously tracking specific program milestones to strengthen its organizational capabilities (e.g., building out a pre-sales organization with 200 professionals), and is on track to build a large and highly competitive ITO services business.