Context

An international hospitality company needed to reduce its operating cost in order to reinvest savings into acquiring additional hotel brands. The objective was to reduce the IT cost by millions for both the in-house service desks and the infrastructure operations.

Accomplishment

Set the goals and strategy of outsourcing

• We formed a leadership team of subject matter experts (SMEs) for each area of being considered for outsourcing.
• We set an objective to retain SMEs and only outsource commodity services in order to retain the skill sets needed to manage the service provider, drive strategy, architecture and design of technology solutions

RFP to select the vendor

• We developed an RFP that reflected expected deliverables, outcomes, areas for continuous improvement and SLAs for each area. We identified six industry leading global service providers.
• We assessed each service provider against their RFP responses, provided clarifications where needed, down selected to the top two providers, The final two were asked to provide their pricing and contracts for review and consideration.

Implementation of the vendor into the organization

• Jointly documented Standard Operating Procedures for each area of responsibility
• Rebadged the existing teams to the vendor to retain as much Subject Matter Experience as possible.
• Set governance of quality control, continuous improvement and SLAs

Outcome 

We  reaped the financial results in savings of over $15m in the first year, without downgrading the quality of service.

Written by Andy Smith, asmith@penonpartners.com | Practice Leader – IT Operations Excellence Consulting.
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