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8 Tips for Application Maintenance Outsourcing

8 Tips for Application Maintenance Outsourcing

Application maintenance outsourcing (AMO) is an important part of application outsourcing. With AMO, you can outsource all the maintenance activities, such as enhancements, corrections and patch developments.

NEC Corporation of America                                                                                    Image credit: Flickr

You can get the resources that you need for the maintenance phase of your project on a contract basis. These resources include the manpower with the required technical skills, technology and other required resources.

Application development and maintenance form about 80% of the total work that is outsourced. The number of outsourcing companies is also increasing due to the huge demand.

Thus, let’s take a look at the several pros and cons it comes with.

Pros of AMO

AMO is a cost-effective solution and improves your operations and technology well.

Here are some benefits of AMO:

  • Cost and time saving
  • It lets you have more time to develop the app and for other operations.
  • It lets you concentrate on the core business.
  • It makes use of external expertise.
  • Gives you access to industry experts without paying a big compensation as you would for a normal employee.
  • Allows your work to be flexible.
  • Gives you access to talented IT professionals, better tools, equipment, and technology.
  • Improves the performance, productivity, and customer satisfaction.
  • It allows work to be continued in different time zones.
  • Enables you to go without a payroll system.
  • Nullifies the worry about losing key employees.

Cons of AMO

There are many benefits of AMO. But, if you choose the wrong partner or if you don’t take care of the basic guidelines, you could end up losing rather than gaining.

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Here are some disadvantages of AMO:

  • You may lose control over the workflow.

You could have a conflict with the contractor about the differing workflows.

For example, you may want the contractor to use a different approach than what they usually use.

So, you should ensure that the approach that you want the contractor to follow is clear before you sign the contract.

  • The outsourced staff may be disloyal.

You may not have proper communication with your outsourced team and so you may lose control over the team.

  • There is a management overhead.

You will have to deal with extra management duties, since you also have to take up the management issues related to outsourcing.

  • There may be a slow response time to problems.

If there is no proper project management and communication, your customers will experience a slow response time and they may be less satisfied.

Tips to Implement AMO

Thus, you first need to choose the right partner for outsourcing. You also have to follow best practices and guidelines and you need to ensure everything goes smoothly.

Here are eight tips to help you.

1. Set Your Goals

You should set well-defined criteria and quantifiable goals.

You should know what you want from the outsourcing and you need to specify them as measurable objectives. You should then measure the progress of your project with these.

2. Understand the Process

The activities involved in maintenance outsourcing are:

  • Service level agreements (SLAs)
  • Asset transfer
  • Knowledge transfer
  • Architecture reconstruction
  • Environment replication
  • Pilot programme
  • Process propagation
  • Work execution
  • Testing (verification and validation)
  • Deployment
  • Monitoring and reporting
  • Review and improvements

You should understand the workflow, other specifics and how the maintenance process will be carried out.

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You should clarify everything with the contractor and only sign the contract once you are clear about everything. This includes the approach that the vendor will use.

You must follow a well-developed maintenance lifecycle. Each phase (the planning, transitioning, delivery and close out) should occur at the right time and you should have a proper plan for each.

3. Documentation

You must ensure that the knowledge transfer is done properly. So, you must maintain a good documentation and keep it updated. This will also help you during training.

4. Hiring

You must choose experienced and skilled professionals. Such employees will require less training and you can use work trials to select key personnel.

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You should also set aside a budget for training. They need basic training; since they must understand the app they are working on. You can optimise your training costs by choosing employees with the required technical skills and experience and by having good documentation.

5. Make Use of Metrics

You must establish metrics to evaluate the performance and to determine whether the contractor abides by the SLA.

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You can these metrics:

  • Customer demand metrics
  • Enhancements work backlog
  • Maintenance work backlog
  • Priority request ageing
  • Performance metrics
  • Maintenance work volume
  • Enhancement work volume
  • Quality metrics
  • Rework requests
  • Efficiency metrics
  • Utilisation metrics

Verify your measurements using audits and monitor them continuously. You should also regularly hold review meetings and ensure that you are on the right path.

6. Team Integration

You must integrate your in-house team with the outsourced team. There should be good communication with your external staff to reduce misunderstandings and conflicts.

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You should also understand the cultural and geographical differences of the offshore team and try to bridge these differences to work as a single team.

7. Production Management

If you believe in productive work, then must establish a proper monitoring and reporting system as well.

You should also have a strong production management to help you smoothly carry out the joint operations. Everything should be planned and executed according to the plan.

8. Improve Your Infrastructure

If you have a mature infrastructure, you will achieve better results.

You should have a good communication platform, good connectivity and good technology support. Recovery features can also help you improve your efficiency.

So what’s your tip for AMO? Do you have any questions? Please feel free to leave your comments below and thanks for reading!

 

Why India continues to be the preferred destination to outsource

Outsourcing was considered a taboo in its early days, but slowly it is proven as one of the most significant business models.

The rosy days of the global economy are gone and so, while, lowering financial liabilities, organisations have to sustain the quality of service and employ a workforce that is economically affordable and efficiently skilled.

Many countries like China, Malaysia, Philippines, Mexico, Indonesia, and Thailand are rapidly growing as preferred destinations for global outsourcing, but India leads the race by a wide margin since the inception of outsourcing.

So, let’s see why and how India managed to remain in the spotlight.

Cost Effectiveness

Every business strives to be as cost effective as possible, and one of the best ways to cut down on operational costs is to reduce manpower expenses. India qualifies well on this metric and hence attracts foreign companies to invest here, as resource wages are comparatively lower as compared to other countries.

With low labour costs, immense human resources and excellent infrastructure, offshore companies can invest and expect their projects to be completed with high quality and minimum expenses within strict deadlines.

Skilled, Professional Manpower

Currently, India has about 2.75 million software developers in the national workforce. By 2018, this count will reach 5.2 million, a whopping 90% increase.

India’s software development growth-rate is attributed to half the population being under 25 years of age and current economic policies. India is a budding hub of developers and coders, promising to provide world-class services to outsourcing companies.

Apple Inc., the leading technology giant, is looking into setting up a company-owned, technology development centre in India. If this happens, Indian software development prowess will get a huge endorsement. It will be an inspiration for more companies to enter Indian shores for business.

Lack of Language Barriers

In India, English is a compulsory language at school and college levels. A large number of Indians can understand and communicate in English easily.

IT firms have recognised that communication skills of individuals and organisations should comply with international standards. The BPO industry is training its employees to improve interaction skills with offshore customers for business success with special, communications and language training.

Innovating the Business Model Itself

Traditional strategies to maintain profit margins in businesses are losing effectiveness due to soaring competition. A well-designed business model can circumvent the shortcomings of those strategies.

Development based on any traditional business model can fail to protect your margins because of globalisation and price transparency. Indian companies have realised that time spent putting together a solid business model is time well spent.

According to a report by KPMG, the Indian IT services industry is expected to rise from £5 billion in 2000, to  £56 billion in 2010. After contributing significantly to India’s economy over a decade, it has been speculated that new business models will emerge to deal with a rapidly changing marketplace and customer needs.

Innovative Tools for Managing Innovative Teams

Companies are hiring highly qualified and competent people across the globe. Members of geographically diverse offshore teams are working in tandem by using online project management tools, video conferencing, and other media for real-time communication and collaboration.

 A Stable Government and Attractive IT Policy

The Indian IT market currently focuses on providing low-cost solutions to the global IT sector. India’s reputation, as both a source and a destination for IT and ITES workforce, has helped it improve its relations with a number of global economies.

The stable Indian government is offering safe harbour (SH) provisions for various software development services, ITES and knowledge process outsourcing services . The government is initiating several programmes to fulfil India’s vision of good e-governance and digitalisation.

The Indian government’s call “Make in India” is already attracting lots of interest among foreign companies to invest here. It’s been predicted by aircraft manufacturer Airbus  that the Indian outsourcing industry will reach £1 billion with the recent positive impetus.

Conclusion

Mr. R. Chandrashekhar, President, NASSCOM says, “The future looks positive as the Indian IT-BPM industry is evolving dramatically in terms of scale, complexity, and innovation. Going forward, enabling a radical transformation of key sectors in India using ICT to increase access, enhance efficiency, and enable innovation in the sector are going to be some of our priority focus areas. The rapidly accelerating trend of innovation and entrepreneurship in the ICT sector impacts several domains and provides clear indicators that the journey has begun.” [image]

Some places in India where talent is being reared, are a striking contrast to the mediocrity of their surroundings. With the astounding growth of Indian IT and ITES industry, rapidly changing economic scenario, development of SEZs, and availability of the skilled human resource, the global offshore business will grow significantly in the years to come.

Have you outsourced to India yet or plan to do so? Let us know in the comments below, and thanks for reading!