Page 292 - Global Project Management Handbook

PROJECT MANAGEMENT FOR OUTSOURCING DECISIONS 14-17

Case: Infoworld Media Group. InfoWorld Media Group is a division of International
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Data Group (IDG), a technology, media, research, and event company. The company
supports its customers by providing them with IT news, technology comparisons, and
focused research information. InfoWorld is not just a provider of technology but also a
user of technology. In April 2001, InfoWorld hired a new chief technology officer
(CTO). The CTO was faced with a broken IT infrastructure and dissatisfied users.
InfoWorld started to consider business process virtualization to improve the current ser-
vices. The CTO expressed his skepticism: “I wasn’t a fan of outsourcing at all before
this particular experience. When your back is against the wall and you have x amount of
dollars to accomplish a particular goal, then you just have to look at it differently and
see what else is possible.”
Prior to startup of the outsourcing processing, for six weeks InfoWorld evaluated its
network to understand its operational structure. After the network evaluation, the
company performed testing for an additional four weeks. The company conducted actual
rollout in weekends owing to the highly geographically distributed nature of the network
environment.
Barriers to Implementation. The biggest barrier was nonexistence of physical sup-
port. Employees had to solve the system problems via telephone calls without a physical
contact.
Lessons Learned in the Testing Phase. They found a lot of people running applica-
tions that were not supposed to be supported on a corporate network, such as music appli-
cations and file-sharing applications. During the testing phase, there were some legacy
problems with Windows XP, which were solved afterwards. There were shortcomings in
some of the services and lack of monitoring in areas such as finance, where the credit
cards are cleared. The company was able to realize such shortcomings and put in better
processes. In general, the testing phase was an opportunity to review the company’s busi-
ness processes.
Unforeseen Benefits of Implementation. At the end of the implementation,
InfoWorld realized that the services it got actually were better than the expectations.
Secondary benefits were application awareness across the company and standardization
of the applications.
Unforeseen Barriers of Implementation. InfoWorld did not experience any unfore-
seen technical barriers to its desktop and server management virtualization. However,
there were difficulties in persuading people to accept a change. It was hard to convince

people of the benefits of the virtualization.
As a result, InfoWorld saved at least 30 percent on support costs in the first 12 months.
It enabled flexibility toward changes in the business. If the company gets smaller, the cost is
reduced directly by the provider.

Finalization Phase
Once the transition phase is completed, resources become redundant. The idle
resources may be monetary assets as well as the human workforce. An organized plan
for the relocation or elimination of idle resources is an important factor for the ongo-
ing success of the outsourcing project. In most cases, major alterations in the organi-
zational structure are inevitable to cope with the new operational requirements.
The business environment goes through many changes, and employees of the out-
sourcing firm no longer perform the same jobs. Responsibilities and roles do not stay the
same either. As an example of role changes, Nextel’s transfer of IT operations can be
given. Jerry Brace was Nextel’s vice president of customer billing services, which has
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grown since Nextel expanded its outsourcing relationship with Amdocs in 2000. Before
outsourcing, Brace led a group of 20 technicians who wrote the code for the billing system