This presentation discusses NFU Mutual's outsourcing project and partnership with a vendor for additional testing. It covers their selection process, including developing criteria and running proofs of concept. It also discusses how they have lived the relationship, including governance, service level agreements, integrating teams, and moving work offshore. Metrics and cultural integration are important factors for a successful partnership. Overall, the key to success is open communication, agreed metrics, and addressing potential issues upfront.

1. Outsourcing Partnership
Shared Perspectives

2. Introduction
James Brodie
Test Manager/Service Delivery Owner
NFU Mutual

3. Introduction
This is a presentation based around an outsourcing project I have
participated in within the last year.
This isn’t a sales pitch for a vendor.
This IS a talk about the challenges I have faced from inception through to
the day to day running of the relationship.
This will be useful for anyone who is about embark on their own
outsourcing/ relationship journey

4. What are you looking for
Outsourcing? Partnership?
•How much appetite/ capability do you possess for managing a day to
day relationship?

5. Why are we doing it
Remove constraints on skill and Full Time Employee FTE demand
requirements to address additional testing areas (e.g. non functional
testing)
Gain a greater and more efficient access to tooling and automation
Gain greater and more efficient access to test consulting
Allow internal capability to focus on the Intellectual Property (IP) of
running the NFUM core business and move their contribution up the
value chain
To provide flexibility to address variable demand across a number of
testing phases/requirements for additional testing areas
Achieve long term cost efficiencies for additional testing areas

6. What are we doing
 Assess
 Tangible and measurable results of alternative approaches
 Robustness and flexibility to stand the test of time
 Measure
 Performance of the relationship using KPIs (e.g. productivity, quality, timeliness,
reporting, Others – downtime, support effectiveness, effectiveness of knowledge
management, etc)
 Ability to meet common or specific business need
 Validate
 Phased approach driven by maturity levels to minimize risk and disruption, but
significant enough to deliver benefit (i.e. not a body shopping exercise)

7. How are we going to do it
Using all the work done to date formalise the activities to achieve an informed and
tangible closure
Create a simple capability assessment document, this should also include details of
any Proof of Concept (POC) dates and potential size etc
Identify a specialist suppliers that could work in partnership to help develop the best
strategy moving forward.
Use existing capability statements to help develop the understanding of viable models
and help formulate an initial strategy
Formalise engagement with these specialist suppliers, and in collaboration allow them
to demonstrate their tangible capabilities evidenced by maturity in the models by
using real life examples (in the insurance space)
An implementation plan for formalised POC(s) with a selected supplier
Verify the selection based on results of the POC(s)

8. Our Journey
The selection process
Qualifying selection
Living the relationship.

9. The Selection Process
A simple scoring matrix to gain hard and tangible results
A simple commercial assessment model to compare one partner with
another etc.
Evaluation criteria should be developed prior to engagement to ensure
honest and independent evaluation of partners
Set common challenges for suppliers to overcome via the capability
statement, which can then be used for tangible evaluation
Suggestions of common challenges faced elsewhere.

10. Status
Oct 08Oct 08 Oct 15Oct 15 Oct 22Oct 22 Oct 29Oct 29 Nov 05Nov 05 Nov 12Nov 12 Nov 19Nov 19 Nov 26Nov 26 Dec 03Dec 03 Dec 10Dec 10 Dec 17Dec 17 Dec 24Dec 24
Overall GovernanceOverall GovernanceOverall GovernanceOverall Governance
Activity InitiationActivity Initiation
Capability StatementCapability Statement
Establish Contractual & Commercial FrameworkEstablish Contractual & Commercial Framework
 Stakeholder
Engagement
Kick-off Meeting 25/10/07
Pipeline DemandPipeline Demand
Selection Timeline
Supplier NDAs *Supplier NDAs *
Start to issue Supplier H/L* CapabilitiesStart to issue Supplier H/L* Capabilities
Supplier AssessmentsSupplier Assessments
Identify POCsIdentify POCs
Set Customer/Demand Makers ExpectationsSet Customer/Demand Makers Expectations
Collate Commercial InformationCollate Commercial Information
 Selected
Supplier
& POCs
 Detailed
POCs
Plans
2007
LOI*/HeadsLOI*/Heads
of Termsof Terms
Detailed Service DescriptionsDetailed Service Descriptions
 Checkpoint
Go/No Go
21/12/07
CommunicationCommunication
Current and Future Business
Risk Profiling
Current and Future Business
Risk Profiling
Team Supplier MeetingsTeam Supplier Meetings
Relevant Client Case StudiesRelevant Client Case Studies
 Identify Relevant
Clients 29/11/07
Team Client ReferencesTeam Client References

11. Request For Proposal (RFP)
Project Scope
Procedure
Benefit Realisation
Supplier History & Capability
Requirements
Relationship
Commercial Considerations
Exit Strategy
Contractual Requirements
Add Value And Innovation
Format And Presentation Of Responses
Audit And Control

12. RFP From The Vendors Perspective
• Understanding the needs of the Client
• Technology
• Domain
• Testing requirements
• Value addition
• Relevant prior experience
• Key personnel
• Key differentiators that the client can take away

13. Proof Of Concept (POC)
Objective
Outcome
Scope
Background Information
Methodology
Timelines
Metrics
SLAs
Success Criteria

14. POC – Vendors Perspective
• First impression is the best impression
•Delivery
• On Schedule
• On Budget
• To the required standards/ quality
• Showcase
• Understanding
• Talent
• Experience
• Knowledge
• Go beyond stated client needs
•Gain an understanding of client pain points and organization

15. POC Scoring Matrix
Microsoft Excel
Worksheet

16. Governance
• Effective framework to manage the relationship
• Key personnel
• Escalation mechanisms
• Conflict resolutions
• Identifying key metrics
• Account review mechanisms
• Reporting mechanism
• Change management

17. Governance – Vendors Perspective
Onsite Account Manager
First point of escalation
Receiving all sourcing requirements from NFUM
Coordinating to get the right fit resources
Coordinating with NFUM Group IT Testing team to seek clarity on exact skill requirements, etc. and
organize any interview that needs to be done
Ensuring agreed SLAs are met for resourcing
Relationship management
owns the business case
Program management
Drives the vision and strategic intent to a project level
Project Management
ensuring the management of project delivery on everyday basis
Operational management
ensuring the technical and quality compliance during delivery of the project
Key principles
Transparency at all levels and forums
Periodic checkpoints, timely escalation and quick decision making

18. Living The Relationship
Procedures
Ensuring that you have your own procedures documented
Ensuring the procedures are explained and understood PRIOR to a
piece of work starting.
The vendor needs to know of any unique conditions of employment.
Service Level Agreements (SLAs)
Agreeing the terms of the SLA
Which of the SLAs will have the biggest impact on the business
Which of the SLAs will you deal with most commonly?
Have the SLAs been communicated to all the major stakeholders?

19. Living The Relationship
Integrating the teams
Moving away from us and them
Team building
Going as far as vendor staff managing NFUM staff
Knowledge retention/transfer
Between vendor and NFUM
Between vendor staff
Moving up the value chain and away from pure staff augmentation
Moving beyond Testing Service

20. Living The Relationship
Issue Resolution
Timely raising of issues
Willingness to work together
Confidence Building
Metrics
Reviewing of work
Impact on other relationships (e.g. contractors/agencies)
Communicating potential change to other parties

21. Living The Relationship
Management overhead
The need for a relationship owner to deal with day to day issues
Escalation points
Juggling business as usual with vendor management
Management liberation
The ability to hand over a piece of work with confidence.
Governance
Ensuring you follow the disciplines set down in the governance
documents.
Being able to work to the spirit of the document rather than relying
on it to resolve issues.

22. Living The Relationship
Moving offshore
Staff may worry about their jobs
Connectivity Issues
Ensuring communication procedures are in place.
Quality reviews
Metrics
Reporting structure agreed.

23. Living the relationship - measurement
Microsoft Office
Excel Worksheet

24. The Vendors Perspective
Cultural Integration
NFUM specific knowledge
Speed
Process expectations e.g. Lack of formal capacity planning

25. Critical Success Factors
Investment in knowledge transfer
Investment in designated people for relationship management
Budgeting for initial teething problems
Periodic checks and balances

26. Key Objectives To Takeaway
Honest addressing of both teams’ questions will give you a far more
productive environment
Agreeing which metrics both companies use ensures expectations are
understood and agreed, and it allows you to implement SLAs.
Communication is the key to any engagement. By initially having some
tough talking it allows both sides to work within agreed parameters.

27. Questions

28. Contact Details
Company Website www.nfumutual.co.uk
Email: james_brodie@nfumutual.co.uk