So you’ve made the decision to outsource some or all of your SAM to a 3rd party partner… you are confident that as part of Service Implementation they will capture every piece of entitlement; understand how every license is actually being used; know when a new application is installed; interpret licensing rules; apply them to your company’s unique situation; and advise on how to get the best value from your licenses and ensure you are compliant.
Easy! After all, that is what they are paid for….
But of course, no matter how much you pay someone, they can’t perform miracles. Very often, the assumption behind outsourcing SAM is that there will no longer be any need for IT to worry about managing software in-house and the 3rd party can be managed in the same way as your widget supplier.
Unfortunately, reality will be different from this nirvana! The truth is that in order to achieve a successful SAM Managed Service, you need to recognise that your 3rd party service provider will struggle if it isn’t provided with adequate support.
You will need to be clear with your Service Provider exactly what it is you want them to achieve, and ensure both of you understand what success looks like.
It’s also important to recognise that SAM is expensive! Engaging a Service Provider is unlikely to lower your overall costs, but it almost certainly WILL bring increased value for the same cost. Finally, it’s critical that both parties actively manage the relationship. A SAM Service is a little like a marriage – unless both parties make an effort to make it succeed, the relationship will grow stale and both parties will gradually forget why the ‘fell in love’ in the first place.
Below are some top tips for getting the most out of a 3rd party SAM partner and ensuring the engagement is a success.
I am sure most SAM Service providers would agree that the most challenging engagements – and the ones where they are most likely to end up with an unhappy customer – are those where the customer doesn’t have a clear idea of what they actually want.
Before embarking on the search for a 3rd party partner, spend some time thinking about your SAM strategy – make sure you are very clear about exactly which aspects of the SAM lifecycle you want to keep in-house and which aspects will be outsourced.
Equally important is understanding how you intend to manage the intersections between the processes that remain in-house and those which will be outsourced. Remember that SAM has a wide variety of stakeholders and you need to ensure that their needs are met – for instance reporting for the Finance department. On the flipside, the SAM Service provider will itself need information from various stakeholder groups – for instance information from HR about new joiners and leavers. You need to consider how these needs will be met BEFORE you enter into any contracts.
Of course if you’re outsourcing SAM, it is entirely possible that other functions have or will be outsourced too. If this is the case, you will need to be clear with your SAM Service provider how they should work with any existing outsource suppliers – and in fact you may need to facilitate the development of a three way or multi-way relationship between yourselves and your other outsource partners in order to ensure that the Service is a success.
When implementing a new SAM Managed Service, you may also find you need to negotiate new services from existing outsource suppliers to ensure the SAM Service provider can provide an effective service – this could potentially involve additional, unexpected costs and the development of new ways of working for the other partners, so make sure these other parties are involved in discussions at an early stage.
The important thing is that you identify these issues in advance and work with the Service Provider and other partners to include these activities at the negotiation / contractual stage to avoid problems later. Of course there will always be issues that crop up that you weren’t aware of when you agreed the contract, so also ensure there is a mechanism within the contract to allow for changes, and ensure all parties are in agreement of how and in what circumstances you will revisit the arrangements if it becomes necessary.
Many SAM outsourcing deals start off as an effort to save money… which opens everyone up to a disappointing experience.
There are many reasons for this, including a lack of recognition of just how much work the in-house team were doing, and underestimating the value of having a flexible team that can easily re-prioritise tasks so that senior management need merely sit in the Captain’s chair and say ‘make it so’ whenever they need ad hoc analysis and reporting.
The other reason why SAM outsourcing deals can feel more expensive than an in-house team is – and this may be controversial to some! – because often the in-house team and IT management don’t recognise that they’re not doing SAM very well in the first place. They may only be focusing on a sub-set of applications, or avoiding certain activities because they don’t have the skills in-house to complete them. This is a particular risk in organisations where SAM has been a part time role for one of the desktop team!
Although the Managed Service contract will cover a defined piece of work that may already be carried out internally, once the outsource deal is implemented it can quickly become apparent that IT Service Management Teams need to provide a lot more information to the Service Provider than they did to the internal team. In addition, there will still be significant internal resource required to ensure that the internal processes required to support the Service run smoothly so that data is received on schedule to avoid costly delays.
The end result of these issues is often that the company doesn’t feel they are getting a good deal because costs and internal resource utilisation are still high, while the outsourcer is frustrated because they know they have an unhappy customer.
So you need to recognise that the true benefit of outsourcing some or all SAM Services is that generally you will get a higher quality, more stable service for a given sum of money. Because of the risks associated with SAM it is worth making the case internally to management that the real benefit of an outsourcing deal will be an increase in quality rather than lower costs, and that this worth paying for.
All too often companies and organisations engage a Service Provider, get the service up and running, but then not worry too much about actively managing the relationship. The assumption from the customer, and sometimes the Service Provider itself, is that just getting on with the job is good enough. Unfortunately it rarely is!
The issue boils down to a mismatch in expectations – many companies embarking on an outsourced Service imagine that using the service will feel the same as if the service was provided in house. Unfortunately, that’s just not true for two main reasons – flexibility and a lack of corporate knowledge.
The first issue, lack of flexibility, has to do with the fact that the Service Provider is a business – they agreed to provide a specific service for a specific sum of money and if their costs are higher than expected they won’t make a profit and run the risk of going out of business.
Therefore Service Providers find it difficult to change the service at short notice, even though it may be “just” be to run an additional report. But even running a simple report requires resource that will be earmarked for other activities, perhaps even working for a different customer, so the knock on effect within the Service Provider can be significant both in increased costs and the impact on the service they provide to other customers.
Although it is possible to build a degree of flexibility into the service, there will always be a cost to this as the service provider will need to charge more to ensure resource is available as and when required, rather than being able to plan how they will use resources a long way in advance so they are as efficient as possible.
The second issue that outsourcers face is that because they are not part of your company or organisation and do not work at the company’s premises day in day out, there is always a lot of information they’re not aware of but which if they were would impact the way they provided the service and the priorities they attach to different activities. This is not just formal business communications, such as that contained in corporate emails and Town Hall meetings, but also information that is disseminated organically – around the fabled ‘water cooler’, for instance, and which employees and managers are often not always aware that they’re making use of.
Implementing formal governance over the relationship, with regular account meetings at different management levels is the most effective way to minimise both of these issues. Governance meetings should take place between peers in both organisations on a regular schedule at all levels of the relationship – at the strategic level there should be annual or bi-annual meetings between the relationship sponsors (usually a senior manager for both parties), monthly or quarterly account management meetings between the Service Provider account manager and internal functional managers, and monthly or weekly meetings at the work-a-day, business as usual level. You may even need to arrange regular meetings with other stakeholders, who, while not directly using the Service, are still impacted by it.
As the customer, you are the one with the ace up your sleeve – you know the level and style of service you expect; you know what value you expect to receive from the service; and you have access to critical information that the Service Provider won’t know unless you tell them. You, at the end of the day, are the one who will be satisfied or dissatisfied with the service you receive.
So if you want to be a satisfied customer, you must take responsibility for ensuring that the Service Provider has the information they need to make you happy. If the relationship doesn’t ‘feel’ right, you need to take responsibility for identifying why you are unhappy and communicating this so the Service Provider does something about it.
There is a saying that the customer is always right – but that’s not really true for a SAM Managed Service. A SAM managed service is a complex beast, with success or failure very dependent on a lot of internal factors that are beyond the Service Providers control. Both you, as the customer, and the Service Provider, are in the relationship for a reason… so it’s a waste of everyone’s time and money if both parties don’t do what they can to make the relationship succeed.