Transcript Vendor Management Office

SIAC
Vendor Management Office
Robert Durso
Director - Vendor Management Office
October 8th 2002
Mission
Expand and improve the use of third party vendors
throughout the NYSE and SIAC
To improve time to market capabilities
To augment technical and domain competencies
To improve operational efficiencies and reduce costs
Vendor Management Office
Maintain Master Services Agreements (MSA) with Preferred
Vendors
Maintain Vendor Relationship & Qualify additional Vendors
Maintain Program & Project Measurement Metrics
Provide training workshops for Project Managers
Assist Project Managers in:
the evaluation and selection of projects,
developing and evaluating proposals, statements of work, service
level agreements and other support documents,
monitoring vendor performance
Critical Success Factors
Careful Selection and Planning of Projects
Competencies of Preferred Vendors
Strong Support Mechanism for Project Managers
Well planned Knowledge Acquisition Phase
Close monitoring of Vendor Performance
Well Defined Outsourcing Infrastructure
Vendor and Project Selection
Selection Criteria
Vendor Selection Criteria
Corporate Profile – Revenue, number of employees, listing
Enterprise Competencies or Boutique Technology
Domain Expertise
Quality Initiatives (CMM Level 3 or higher)
HR Policies
Offshore Development Center Experiences
Offshore Contingency Plan and Infrastructure
Flexibility, Reliability and Peer Organization References
Selection Criteria
Project Selection Criteria
Projects with resource constraints
Projects with clearly defined requirements
Conversion Projects
Maintenance and Enhancement Projects
Support Projects
An assessment should be performed prior to launch
Setting the stage for a successful launch
Offshore Feasibility
Assessment
PREPARATION
KNOWLEDGE
ACQUISITION
PROJECT EXECUTION
NEW DEVELOPMENT
MAINTENANCE
TECHNICAL UPGRADES
QUALITY
ASSURANCE
USER
ACCEPTANCE
PARALLEL RUNNING
(PRODUCTION SUPPORT ONLY)
Competitive Bidding Verification
Competitive Bidding - RFP's will be sent to preferred vendors as
is stated by SIAC Procurement and the Competitive Bidding
Procedure.
Phased Bids - It is recommended that each project is broken
down into smaller phases. Each bid response should include all
associated fees for each phase. This will give us the ability to
evaluate each Vendor's phased bid response.
Internal Verification of Effort*Cost - the VMO and the project
managers will work together to calculate and verify bids by
estimating effort and multiplying by Fees within the MSA (Exhibit
F - "Fees".).
Project Management Workshops
Course is a scaled down version of a 3-semester
hour graduate level software engineering class
offered by SMU.
It builds on the best practices from both Government
and Industry to provide Project Managers with
essential information needed to either solicit bids for
a development project or to respond to a request for
proposal (RFP) for a development project.
It introduces the Project Managers to the most
common legal issues that are encountered in a
software acquisition.
Managing the Metrics
Five Views For Managing The Program
• Measuring Organizational Commitment
• Measuring Project Status
• Measuring Time-to-Market
• Measuring Skills Augmentation
• Measuring Costs
Measuring Organizational Commitment
In Pipeline
Project Name
Assessment Score
Projected Start Date
Vendor(s) Bidding
Vendor Data
Vendor A:
• No of Projects:
• $$ of Projects:
Vendor B:
• No of Projects:
• $$ of Projects:
Active Projects
50
45
Vendor C:
• No of Projects:
• $$ of Projects:
Off-Shore
Vendor D:
• No of Projects:
• $$ of Projects:
Onsite
Project Size
40
35
30
25
Portfolio Data
20
15
10
5
Project
Name
Project Type
Vendor
Project Phase
Project
Name
Project
Name
Project
Name
Project
Name
Project
Name
Project
Name
TOTAL
No. of Engagements =
Type of Projects
• Development =
• Maintenance =
• Technical Upgrades/Conversions =
• Other =
Total FTEs Under Program
• On-Site =
• Off-Shore =
Total $$ Committed to Projects =
Total $$ in Local Equivalent =
Total $$ VMO =
% Offshore $$ to IT Budget =
Measuring Project Status
Project Name/Vendor Name
Project Description: {Replace with Brief Project Description}
12
Onsite
Off-Shore
Business Objective: {Replace with Cost Savings, Revenue
Generation, Compliance, Governance, Quality}
10
Project Size
8
Project Type:
6
Project Type
Technologies: Technology Type
Project Phase: Project Phase
4
2
0
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Scheduling Variance:
0%
Resource Variance:
0%
Vendor Costs To Date:
$50,000
Original Vendor Budget:
$100,000
Revised Vendor Budget:
$400,000
Dec
Major Achievements
Outstanding Issues:
Aug- {Replace with Major Achievements either for current month
or previous months.
{Replace With Outstanding Issues}
Sep – {This section is indented for 7 characters.
{Insert Major Statement Regarding Project For Current Month}
Measuring Time-to-Market
Actions To Accelerate Throughput And Measuring Their Impact
Actions
Measurement
•
Re-engineer Delivery
Process
•
Backlog Size
•
Adopt a “Service-Based”
Requirements/Design
Model
•
Backlog Duration
•
Employ Parallel
Development Process
(24x7)
•
Average Elapse Time for
Work-Unit, e.g. Function
Point
•
Add additional resources,
I.e. Skills/Staff
Augmentation
•
Elapse Times against
Fixed Delivery Timeframes
Measuring Skills Augmentation
Local Staff Augmentation
Project Type
•
Local Staff Augmentation versus
Offshore Staff By:
•
Environment Work (Mainframe,
Internet, Client/Server, Other)
•
Project Type (Development,
Maintenance, Upgrade, Conversion,
Other)
•
Skills Mix (SAP, COBOL,
Websphere, C/C++, Other)
•
Functional Area (Administration,
Trade Support, Q/A, Other)
Other
7%
Upgrades
13%
Development
53%
Maintenance
27%
Offshore Functional
Area
Q/A
10%
Other
7%
Trade Support
26%
Administration
57%
Example for Measuring Cost
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
$500,000
$1,000,000
Cost
Gross Billing Savings
VMO Costs
Other Costs
Net Savings*
$2,600,000
-$300,000
-$750,000
$1,550,000
[T & M]Gross Billing Savings = (Local Equivalent Rate x #Man Days/Hours) – (Vendor Rate x #Man Days/Hours)
[Fixed Price]Gross Billing Savings = (Local Equivalent Rate x #Man Days/Hours) – (Contracted SOW)
Outsourcing Status
Offshore Status
6 Active projects at the NYSE with 3 Off-Shore Vendors
Master Service Agreement negotiated with several Off-Shore
Vendors
MSA Supporting Documents Available
Request For Proposal Template
Statement Of Work Template
SOW Change Request Document
Service Level Agreement Template
Project Evaluation & Cost Analysis Template developed
Vendor Management Office Intranet Site
Measuring our Mission
1 Project - Requirements through Implementation
Speed to Market
2 time-zone prototyping
Strong Project Management coupled with CMM Level 5 company
Active defect containment measures
Skills Augmentation
Ramped-up 25 skilled developers in 6 weeks
Resulting Time and Cost Savings
18 modules, with significant process re-design
10 months
Approximately 50% Gross Billing Savings (excluding transition,
communication and other overhead costs)
VMO Lessons Learned
Senior Level Sponsorship
Define a Clear Mission
Communicate and Educate Early and Often
Define VMO Infrastructure Early (Even before first pilot)
Continuous Process Improvement
Establish Achievable Goals
Define Program/Project Metrics early
Solid Risk Management Strategy
Plan Transition in/Transition Out for all projects
VMO ease of use is as important as a delivery model
SIAC
Vendor Management Office