This first of a series of blogs designed to share with you the thoughts and insights of corporate leaders and their perspectives on the decision making process around outsourcing. Our first is with Ed Susman, who is with Citibank.
What are the most important attributes you seek in a potential provider/ partner?
While each sourcing opportunity is distinct with specific attributes that drive the selection of a provider there is one attribute that is transcendent, integrity. If a provider does not behave with integrity it does not matter how capable they are or what savings they might be offering. Sooner or later the anticipated benefits will be outweighed by the cost of a contentious relationship.
Other attributes are more transaction specific with each weighed and trade-offs made depending on the nature of the transaction. These attributes include: capability, flexibility, ability to innovate and of course cost. The challenge in making these trade-offs is to get clarity and alignment from all of the parties involved as to what it is that the organization is really trying to achieve. I have seen many transactions go bad when the client talks innovation but what they really want is a cost reduction.
What one single factor is most likely to prevent you partnering with an organization?
Lack of trust is the single factor which is most likely to prevent me from partnering with an organization. Of course lack of trust can take many forms. Do I trust the organization in general? Do I believe that the organization will be able to deliver the service regardless of all of the SLA’s that have been put into the contract? Do I believe that the cost savings and productivity benefits that are being promised will materialize or will they become vapor savings / benefits over the life of the contract?
If you have signed a deal with a major provider of Outsourcing services, what was the deciding factor in that selection?
As noted above the deciding factor for each transaction will differ depending on the objectives that we are trying to achieve with trust in the provider and the providers ability to deliver being the primary overarching considerations. To effectively execute on this strategy we have executed Master Services Agreements with many if not most of the major Outsourcing providers along with a variety of secondary players. Having these agreements in place gives us the flexibility to source individual programs and projects to providers on a “best fit” basis. This approach also creates a competitive environment which incents improved performance on the part of the providers and allows us to measure their performance on an “apples to apples” basis.
We recently did a deal with a major provider for middleware support. Key to that deal was our belief that the provider could improve the quality of service at a lower price point first through consolidation followed by automation. What clinched the deal was the providers willingness to assume much of the risk.
How will you measure the impact of that deal on your firm both short and long term?
For all of our deals we measure success based on the specific objectives that drove the sourcing in the first place. For the middle ware support deal described above the short term impact would be measured by improved quality of service at a significantly reduced price point . Long term the ability of the supplier to replace resources with software will be the impact that we will be looking for with a significant decline in the number of resources supporting middle ware the key metric. If it can be achieved it would be a transformational change; one which we would be looking to replicate in other domains.
What’s the most important lesson you’ve learned over the course of your career?
This is one is a tough one since there have been so many lessons learned but if I had to pick one it would be to look at each situation from the perspective of the other party in order to craft win-win solutions. During the course of my career I have been privileged to work in a number of different roles starting as an application developer / manager before moving into sourcing on the sell, then advisory and now on the buy side. Having served in all of these roles allows me to understand what is motivating the parties that I am dealing with so as to be able to structure solutions that meet their objectives as well as those of my firm.
Mr. Susman is a seasoned professional with the ability to think strategically and execute tactically. Mr. Susman is currently a Director at Citigroup where during the course of his tenure he has assisted Technology organizations in the design, implementation and ongoing management of their resource and sourcing strategies. Prior to joining Citigroup Mr. Susman was a Partner at Technology Partners International (TPI) where he provided counsel to Senior Executives grappling with the challenges of managing outsourcing relationships and with the structuring and standing up Shared Services organizations. Prior to joining TPI, Mr. Susman was a Partner in Computer Sciences Corporation’s (CSC) Strategic Services Group, where he focused on the establishment of global operating models in support of outsourcing “megadeals” as well as in helping business and technology executives with the strategic use and management of technology.
If you have questions you would like to submit for our next interview, volunteer to be interviewed or just want to reach out to us, please email me Larry Janisemail@example.com