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A Leading Business Services Firm
Global 5000 HR Outsourcing Industry
Suppliers: 11 leading offshore suppliers
Scope of Service: Provide consulting services for strategy planning, due diligence, sourcing, contract negotiations and governance for
offshore application support and maintenance.

An innovator and leading outsourcer in the HR-led BPO market. Meeting an increasingly critical need for Global 500 companies and other large complex corporations, our client provides comprehensive Human Resources outsourcing solutions and expertise in high volume business processes, including related Finance and Accounting and Procurement offerings.

Business Challenge
Our client’s IT organization consisted of mainly People-Soft and SAP for 4 different clients. Each client had customized their applications to various extents, and some included various add-on applications such as AP, GL, resume management, etc. They were faced with managing multiple client-centric IT maintenance and enhancement processes versus managing overall process improvement for their clients. Adding resources in the expensive US environment was not cost effective and as the processes improved, often led to layoffs.

Our client needed a solution that would enable them to access savings, skill and scale. Savings. They wanted to meet or exceed the 45% savings margin they were gaining by offshoring IT services to India. Skill. They wanted to tap into new sources of expertise while replicating the level of skill that their customers had come to know from its onshore facilities. Scale. By being close to large pools of low-cost talent, they wanted to be able to provide additional capacity to accommodate their growing global business.

After portfolio analysis & development of outsourcing roadmap, the next step in their global sourcing strategy was to conduct due diligence on the list of eleven suppliers. The due diligence used a structured process to manage subjective and objective criteria. The companies were evaluated on culture, domain experience, performance history, human resources, project management skills, productivity history, market reputation, infrastructure, transition processes, risk policies and procedures, knowledge management processes and tools, as well as several other criteria.

The due diligence and subsequent analysis led to the recommendation of a multi-source engagement with a combination of Indian tier 1 & tier 2 suppliers. Despite the brand recognition of the other offshore suppliers, the tier-two supplier outperformed on a number of areas. Leveraging a team of seasoned auditors to perform a detailed assessment of each supplier’s domain, technical, and functional knowledge, the neoQA evaluation criteria included:

Past projects. What kind of clients had each supplier worked with before? How successful were these engagements? How did the suppliers reduce risks and improve ROI?
People. How-and how well-did the suppliers manage their human resources? What compensation and incentive policies were in place? How did they handle performance reviews?
Pricing. What pricing models did the suppliers offer (e.g., time-and-material, fixed price, or risk-and-reward)? What were their service credit policies when an issue occurs?
Performance. How customer-focused was each supplier? Did they survey for customer satisfaction? How much of their business was repeat business? What was the overall financial viability of each organization?
Platform. What equipment and expertise did the suppliers have in place? What were their security and business continuance policies?

The transfer of activities to the selected suppliers has enabled our client to save over the original estimates of 45% to date. The due diligence on the suppliers empowered them with knowledge not only with information on specific suppliers that met their requirements, but also with knowledge about global markets that later allowed them to expand their global plan even further.

Today our client operates fully-owned operations in Mumbai, India and Krakow, Poland with supplier partnerships in India.

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