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Global Packaging Manufacturer IT Outsourcing Facilitation
Background
A global packaging company with $6B in revenues was planning for significant organic growth and multiple acquisitions. The company required additional flexibility and scalability from the IT infrastructure to support the planned growth. Past acquisitions had not been integrated completely, and IT service delivery lacked consistent quality across business units. Though internal IT costs were relatively low, the company’s leaders thought outsourcing might be a means to create a new common platform for growth in a minimal amount of time. The new platform would be a shared service across all business units. A critical, company-wide SAP rollout was in progress, and outsourcing risks had to be mitigated to ensure the rollout’s success. The W Group was engaged to validate the outsourcing strategy and lead the process of selecting providers, negotiating service agreements, and beginning the transition in less than nine months.
Approach
The W Group led a large client team comprised of representatives from technology, human resources, finance, and legal. The team first reviewed and validated the client’s strategy based on market data and service provider capabilities.
The team created a detailed cost model to compare internal costs with those of established IT service providers, based on recent deals.
Specific services were identified for cross-business-unit consolidation and outsourcing. Similarly, other services were selected to remain internally delivered, based on strategic and service-quality considerations.
A thorough RFP process was followed, including multiple face-to-face solution design sessions so the client was able to influence the providers’ solutions and become more familiar with each provider’s style and personnel.
The evaluation process resulted in selecting a service provider based on criteria including operational impact, cultural fit, and cost.
Results
The client established its first outsourcing agreement with a Tier 1 provider for IT infrastructure, and help desk and desktop support.
Infrastructure services were relocated according to schedule and provided a new, scalable platform that could support growth and new acquisitions.
A new cross-business-unit delivery model was created to enable expansion to global operations.
The SAP rollout continued with better management focus and less implementation risk.
Costs were further reduced by 10% via infrastructure consolidation, and new levels of service-cost transparency were delivered to the business units.
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