Offshore Outsourcing by Oe47eh

VIEWS: 48 PAGES: 77

									         Offshore Outsourcing
•   Pei-Fen Chan
•   Soojin Kang
•   Aaron Schiltz
•   Bill Bernskoetter




                                1
 What is Offshore Outsourcing?

• “The exporting of IT-related work from the
  United States and other developed countries to
  areas of the world where there is both political
  stability and lower labor costs or tax savings.”


           Source: Whatis.com




                                                     2
What do you think of Offshore
       Outsourcing?
• Is it good or bad for the US economy?
• Who benefits the most?
• Who gets hurt?




                                          3
Offshore Outsourcing in the News




                                   4
 Offshore Outsourcing in the News
                           (cont.)



• Outsourcing Debate Turns Spicy for Powell
  Cynthia L. Webb, Washington Post 3/17/04


• Outsourcing comment stirs a firestorm even if
  it's good economics
  David Nicklaus, Post-Dispatch 2/17/04

http://www.umsl.edu/services/ur/media/umslair/040324.mov


                                                           5
Offshore Outsourcing in Politics
• US politician Kerry calls outsourcing firms
  traitors economictimes.indiatimes.com
• Kerry was quoted by Contra Costa Times on
  as denouncing the Bush Administration for
  "rewarding Benedict Arnold CEOs who move
  "profits and jobs overseas.“ economictimes.indiatimes.com
• Missouri has joined over 30 other states in
  drafting anti-sourcing legislation with the
  objective of protecting domestic jobs.
  www.infotech.indiatimes.com
• javascript:oMvsLink('00','bd29daba-8f3f-4b4d-
  876f-648c03aa1848')

                                                              6
    Size of Offshore Outsourcing
               Industry
• In 2002, $32-$35 billion outsourced
• 1% of the $3 trillion that could be outsourced.
• Projected to grow 30%-40% over the next 5
  years
• Make it an industry with well over $100 billion in
  annual revenue by 2008.
•   Www.forbes.com/home/2003/12/04/1204mckinsey.html




                                                       7
Promised Benefits of Outsourcing

 • Lower inflation
 • Increased productivity
 • Lower interest rates
 • By 2008, GDP expected to be $124.2 billion
   higher
 • 90,000 net new jobs as of 2003, 317,00 net
   new jobs by 2008.
                Source: Global Insight, Inc. 2004



                                                    8
Promised Benefits of Outsourcing
                          (continued)


• Increase in real wages for US workers
• Increase in demand for US exports




               Source: Global Insight, Inc. 2004




                                                   9
Net Jobs created by Outsourcing
                                     Global Insight, Inc. 2004




                   Jobs Created With Outsourcing vs Jobs
                          Lost due to Outsourcing
  Number of Jobs




                   700,000
                   600,000
                   500,000
                   400,000
                   300,000
                   200,000
                   100,000
                       -
                             2003   2004     2005      2006      2007   2008
                                                 Years

                                     Jobs Created         Jobs Lost

                                                                               10
Exports                            Source: Global Insight, Inc. 2004




                    Real Exports Rise due to Offshore
                              Outsourcing

                    $10.0
Cum. Improvement,


                     $8.0
    Billions $


                     $6.0
                     $4.0
                     $2.0
                     $0.0
                            2003    2004     2005     2006     2007    2008
                                                 Years

                                              Real Exports




                                                                              11
           Top Countries for Offshore
                 Outsourcing
•     India
•     China
•     Malaysia
•     Czech Republic
•     Singapore
•     Philippines
•     Brazil
•     Canada
Source: A.T. Kearney from Forbes.com




                                        12
      India
• Population: 1 billion
• Interesting Finding: IT software and services
  export market expected to grow from $10 billion
  in 2002 to $60 billion by 2008.*
• Reasons Attractive: Low wages, favorable tax
  rates, quality of IT training and education,
  English language skills.
• Negatives: Political and economic instability,
  bad infrastructure.
• U.S. Cos.: Hewlett-Packard, Amazon, Sprint
  Source: NASSCOM, the National Association of Software and Services Companies of India
  *


  Source: Forbes.com

                                                                                          13
  China
• Population: 1.3 billion
• Interesting Fact: Population under age 18 in China is larger
  than the combined total populations of the U.S. and the U.K.
• Reasons Attractive: Low wages, good educational system.
• Negatives: Piracy, red tape, English skills
• U.S. Cos.: IBM, Accenture.

            –   Source: Forbes.com




                                                                 14
  Malaysia
• Population: 23 million
• Interesting Finding: Less bureaucratic red
  tape than Canada.*
• Strengths: Low costs, high level of global
  integration, strong government support.
• Negatives: Piracy, small population.
• U.S. Cos.: Motorola, IBM

  *Source: World Economic Forum's Global Competitiveness Report

   Source: Forbes.com


                                                                  15
 Czech Republic
• Population: 10 million
• Interesting Finding: Offshore services
  market growing greater than 10% annually.
• Strengths: competitive infrastructure costs,
  good education system, stable business
  environment.
• Negatives: Higher labor costs, small
  population
• U.S. Cos.: IBM, Sun Microsystems, Dell
                  Source: Forbes.com
                                                 16
      Singapore
• Population: 5 million
• Interesting Finding: The second-highest income
  per capita in the world but, still attracts U.S.
  companies as a place for regional headquarters
  because of its strengths.
• Strengths: education system, infrastructure,
  intellectual property protection, stable political
  environment.
• Negatives: High labor costs, low population.
• U.S. Cos.: HP, Eli Lilly

                       Source: Forbes.com

                                                       17
         Hidden Costs of Offshore
              Outsourcing
•   Selecting a Vendor
•   Transition
•   Layoffs
•   Cultural
•   Ramping Up
•   Managing the Contract

Source: CIO Magazine, 9101/03, Stephanie Overby




                                                  18
Outsourcing – One Way Street?

• Foreign companies employ 6.4 million Americans
  – Commerce Dept.
  – 114,000 in Missouri
  – 321,000 in Illinois

• Foreign companies in the St. Louis area
  – Reuters – Britain
  – bioMerieux - France
  – Toyota - Japan

        David Nicklaus, St. Louis Post Dispatch, April 16, 2004
                                                                  19
       WIPRO TECHNOLOGIES

1.   Offshore Market in India
2.   Wipro Overview
3.   History of Wipro
4.   CEO of Wipro
5.   Wipro’s Quality Standards
6.   Case Studies
     - Delta Airlines
     - Otis elevator company

                                 20
    PROSPEROUS INDIAN
OFFSHORE MARKET: Why India?
• Lower Cost for highly skilled                              Year Global IT    Indian IT
                                                                  spend($ in   Exports($
  manpower.                                                       Billion)     in Billion)
• Indian Government Initiatives                             1997         359            1.8

• Favorable Tax incentives                                  1998         392            2.6
• The export segment in Indian
                                                            1999         459                 4
  IT market accounts for 60% of
  total revenue of its IT industry                          2000         519            6.2
• India claims 80% share of
                                                            2001         542            7.8
  global off-shored service
• Obstacles offshore vendors                                2002         557            9.5
  face
                   Businessweek, NASSCOM.org, www4.gartner.com
                                                                                                 21
            WIPRO OVERVIEW

•   Size : $1.4 Billion in revenue, 27,000 employees from
    18 nationalities, 30 global offices in India, Australia,
    Japan, and the U.S.
•   Customers: Boeing, Nationwide, Ericsson, Toshiba,
    Cisco, Putnam Investment, etc
•   Products: IT Consulting and services, Application
    Development and Maintenances, Product Design
    Services, Business Processing Outsourcing
•   Main competitors in India : Tata Consulting Services,
    Infosys Technologies, Satyam Computer Service,
    HCL Technologies Ltd
•   Headquarter : Bangalore, India

                          Wipro.com
                                                               22
                WIPRO’S REVENUE PIE
                                                             Computer
                                                            Application
R & D service
                                                           Development &
    32%
                                                            maintenance
                                                                37%




IT enabled service                                 System Integration
      11%               Package                     & IT Consulting
                     Implementation                       3%
                          11%         Infrastructure
                                       Outsourcing
                                           6%




                         Wipro.com
                                                                           23
      HISTORY OF WIPRO
• Started as a cooking oil and soap
  manufacturing company 57 years ago, Wipro
  has transformed itself into a hardware
  manufacturer( light bulb, printers, scanner and
  PCs) and into a software consulting company
  to become today’s Wipro Technologies.
• With the arrival of Vivek Paul, (Vice Chairman
  and CEO) in 1999, now this company enjoys $
  1.4 billion in revenue as the 3rd largest IT
  service company in India
                   Fast company, Wipro.com, Economist
                                                        24
    CEO OF WIPRO:
        VIVEK PAUL

• Graduated from BITS in India, engineering
  major, MBA from University of Massachusetts
• Made his career in America, built his career
  through Bain & Co in Boston, PepsiCo,
  Purchase in NY and ran GE’s joint venture
  medical scanner business with Wipro in India
• In 1999, he was hired by Wipro, since then
  he has turned $150 million software company
  into over $1 billion profit company
• Rated as one of the best managers in 2003
  by Business week
               Wipro.com, Businessweek
                                                 25
                          WIPRO’S QUALITY
                          STANDARDS

• SEI CMM (Software Engineering Institute Capability Maturity Model):
   Highest Maturity Model level 5
• CMMI (Capabilty Maturity Model Integration): First company in
   India to be certified at level 5
• PCMM (People Capability Maturity Model) :World’s first company
   to be level 5
• ISO 9001 (International Standard Organization 9000 series):
   Compliant by 1995




                       Wipro.com, NASSCOM.ORG, sei.cmu.edu              26
Case study 1: Delta Airlines
      • Delta Airlines was operating
        20 call centers all over the
        world with 6500 center
        representatives employed

      • To focus on improving the
        customers’ travel expenses
        and reducing costs on the call
        centers

         Wipro.com                       27
       Divisions Outsourced


• General Sales calls
• Frequent Flyer Service support and
  report
• Reject & queue call handling
• Baggage service center



                                       28
                   Solution
• Transition Toolkit ™ Model that created by
  Wipro to deliver customer service process
  designed for offshore model
  -Analysis: Subject Matter Experts (SMEs)
  team to Spectramind team in Mumbai, India
 - Transition: “Adapted Process Quality
  parameter” set by Delta and achieved by
  Spectramind
 - Sustained Operation : Operation teams took
  over responsibility related to quality metrics,
  resource planning and operational issue
                                                    29
           ENHANCEMENT


• Customer Satisfaction: Decreased the
  average call handling time
• Improved Process: Outperformed “the
  quality of call handling” set by Delta’s SMEs
• Cost Savings: Initial cost saving of $12-15
  million annually projected by Delta over 2
  years


                                                  30
      Quality of call handling operation at Spectamind



200
180                                 93     95     93
160      87     92     92     92
140
120
100
 80      75     75     75     75    80     81     82
 60
 40
 20
  0




                                                         31
                  Reduction in Call Handling Time
                           (In seconds)
700
      639          639         639         630
                                                             599
600                                                    580         579         572
                                                 537
            501                                                          514
500                                                                                  458
                         430         435

400                                                                                        Target
                                                                                           Achived
300


200


100


 0
      Jan W 3      Jan W4      Feb W1      Feb W2      Feb W3      Feb W4      Mar W1




                                                                                                     32
               Case Study 2 :
               Otis Elevator Company

Outsourcing Decision
• Otis is the largest manufacturer of elevators,
  escalators in the world. It was becoming very
  complex to handle after-sales support services
  requested by thousands of customers from over
  50 countries.
• It was time for Otis to search for an integrated
  system to handle these after-sale service and
  revenue functions

                     Wipro.com, Otis.com
                                                     33
                    Solution

• Analysis: Wipro team needed to understand its
  client’s business
• E*Service :
   - An integrated application that was created by Wipro
  - System that can be presented to individual
       customer in country-specific format through a
       single window.
• This service portal was implemented to Otis.com
  (Otis’ global website) and to Otis’ internal system


                                                           34
              Enhancement:
           With e*service, customer has…




• 24 x 365 x 7 access
• Fast and easy service and tracking of the
  service progress
• Access to individual company’s financial
  transaction




                                              35
              Enhancement:
            With e*service Otis realized…


• Cost Savings: Application Development cost
  40% -50% savings
• Efficiency: Otis sales representatives save 20
  minutes with customer contact and save
  around 2 hours for email report to customers
• International recognition: e*service was
  awarded for “Grand Prix de I' Innovation” at the
  French condominium exhibition


                                                     36
• “We appreciate the hard work and nice
  features WIPRO has built into the
  application. It is great to get Positive feed
  back from customers and see the pull for
  the application.”
  - Sarma Pullela, Otis E*service program manger




                                                   37
     BEST PRACTICES FOR SELECTING
    POTENTIAL OUTSOURCING VENDOR

•   Reputation of the vendor and it’s employees
•   Financial strength of the vendor
•   Experience of the vendor
•   Client base of the vendor in outsourcing




                                                  38
   Case Study: PRT Group, Inc.

An unsuccessful offshore outsourcing
            agreement




                                       39
                                  Best Practices
 Practices                                           Description
       1.          Did the company effectively manage their team at great
                   distance?
       2.          Did managers visit the site while evaluating bids?
       3.          Were the contracts signed shorter than 4 years?
       4.          Were the contracts detailed ?
       5.          Was there joint evaluation of the proposals by both
                     senior management and IT managers?
       6.          Were managers directly responsible for the success of
                   the venture ?
       7.          Were objectives clearly articulated to all stakeholders?
       8.          Did both companies adequately prepare for the venture?
Source: Anthony J.Delmonte, Richard V.McCarthy, "Offshore Software Development: Is the benefit   40
                                       worth the risk?"
                            4 Categories of Offshore
                             Software Development
    1.     The first category: involves the sponsoring of foreign
           individuals on employment visa.
    2.     The second: involves the engagement of a domestic or
           offshore consulting firm that could provide the needed
           skills and manage them overseas for the sponsoring
           company
    3.     The third: for the offshore company to recruit the
           workers and send them to the company’s domestic
           location
    4.     The fourth: involves the establishment of a physical
           presence of the business overseas, by the sponsor
           company.


Source: Anthony J.Delmonte, Richard V.McCarthy, " Offshore Software Development: Is the benefit   41
                                       worth the risk?"
Platform Reengineering Technologies
         (PRT) GROUP Inc.
                                      42
      General Information of PRT

        • CEO/Chairman: Doug Mellinger
        • People called: The next Bill Gates
        • Year Founded: 1989
        • Capital: $12,000
        • Headquarter: New York, NY



source: http://www.forbes.com/specialsections/barbados/006.htm   43
General Information of PRT

      • Industry: Software Development

    • Sector: Global IT Consulting Firm




Source: Jack Soat, " IT Confidential", www.informationweek.com   44
           Major Service of PRT

• Strategic Technology Consulting
• On-site, Off-site, Offshore Projects
• Year 2000 solutions
• Tactical/Functional Outsourcing
   and Staff Augmentation.


  Source: www.careerbuzz.com/success/register/ employers.asp   45
 General Characteristics of PRT’s
           Customers

• Fortune 500 companies
 Ex: J.P. Morgan, Prudential,Travelers
     Insurance…
• Large government agencies




   source: http://www.forbes.com/specialsections/barbados/006.htm   46
                    Transformation of PRT
• 1989~1991: Business growth limited by lack of
                  skilled IT workforce
• 1991~1994: Tried to outsource to India
• 1995~1997: Settled on Barbados as a location to
                  outsource
• 1997~1998: Initial Public Offering at $13,
                  $21 at the highest
• 1998~2000: Stock price under water and company
                  was closed in 2000


    Source: Micheal S.Hopkins, "Paradise Lost", Inc, Nov 1999, www.inc.com   47
                               Size of PRT
                       1990            1995          1997         1998             1999

Revenues            $462,000          $3~4     $60      $85                         No
                                      Million Million Million                      Data
  # of               No Data           700    900+     700+                        80
Employees                                             (Lay off
                                                       17%)




Source: Micheal S. Hopkins, The Antihero's Guide to the New Economy, www.inc.com          48
             Why PRT went offshore?

• Critical problem: The desperate
  shortage of software engineers
• Legal restriction for foreign programmers
• Skyrocketing salaries
• Unmanageable turnover among
  engineers

   Source: Micheal S.Hopkins, "Paradise Lost", Inc, Nov 1999, www.inc.com   49
         Locations PRT Considered


  The 1st choice: India
  Why not?
(1) Bureaucracy
(2) The country’s remoteness
  Results: Kept clients away


Source: Micheal S.Hopkins, "Paradise Lost", Inc, Nov 1999, www.inc.com   50
                 Facilitating Developments
     • Decision: the island of Barbados (PRT/Barbados)
     • Why?
     I. Excellent Managers:
        Srinivasan Viswanathan, President of PRT
        Barbados, came from Citicorp in India, where he
        built one of the best offshore development
        centers in the world.

          Richard Koppel, year-2000-bug strategist, was
         formerly the CIO of McKinsey & Co.


Source: Micheal S. Hopkins, The Antihero's Guide to the New Economy, www.inc.com and Source:   51
               Micheal S. Hopkins, "Paradise Lost", Inc., Nov 1999, www.inc.com
                 Facilitating Developments
     II. Customers became investors:
        J.P. Morgan, Chase and others paid for future
        work, invested equity, and contributed millions of
        dollars’ worth of donated design help,
        construction-management expertise, and
        purchasing clout. The value of contributions
        totaled some $12 million in all.

     III. The support form local official government


Source: Micheal S. Hopkins, The Antihero's Guide to the New Economy, www.inc.com and Source:   52
               Micheal S. Hopkins, "Paradise Lost", Inc., Nov 1999, www.inc.com
             Facilitating Developments
     IV. Profit:
     The vision of creating an enterprise which
       was measured to earn far more than the
       profits PRT could generate and the market
       share it could seize.




Source: Micheal S. Hopkins, The Antihero's Guide to the New Economy, www.inc.com and Source:   53
               Micheal S. Hopkins, "Paradise Lost", Inc., Nov 1999, www.inc.com
                   What PRT moved offshore

                    • Software Development Programmers for
                           package of Y2K solutions…
                    • Infrastructures

                    • Capital

                    • Customers



Source: Pamela Abbott and Matthew Jones, " The importance of being nearest: nearshore software   54
                           outsourcing and globalizarion discourse
        Dramatic difference in stock price
             Name: PRT Group Inc.
             Ticker: PRTG       Market: Nasdaq


             25
             20
             15
     Price




             10
             5
             0
                              98




                                            98




                                                                        00
                    97




                                                          98
                            19




                                          19




                                                                      20
                  19




                                                        19
                           26




                                         31




                                                                     21
                 0




                                                        1
               /2




                                                      /3
                         2/




                                       8/




                                                                   7/
             11




                                                    12




                                        Date



Source: Micheal S. Hopkins, The Antihero's Guide to the New Economy, www.inc.com and Source:   55
               Micheal S. Hopkins, "Paradise Lost", Inc., Nov 1999, www.inc.com
       Paradise Lost: What went wrong with
                       PRT
      1. The IPO was inflated by unrealistic expectations
      2. A sales force that was unprepared for the task
      3. Management overfocused on building the
            production side of the business at the
            expense of the marketing operation
      4. Over reliant on the CEO's gift for bringing in
            business




 Source: Source: Micheal S.Hopkins, "Paradise Lost", Inc, Nov 1999, www.inc.com and Anthony       56
J.Delmonte, Richard V.McCarthy, "Offshore Software Development: Is the benefit worth the risk?"
               Did PRT match the 8 best practices?
Practices                                  Description                                    Consequence


   1.        Did the company effectively manage their team at great                              Yes
             distance?
   2.        Did managers visit the site while evaluating bids?                                  Yes
   3.        Were the contracts signed shorter than 4 years?                             Not applicable

   4.        Were the contracts detailed ?                                               Not applicable
   5.        Was there joint evaluation of the proposals by both senior                          Yes
             management and IT managers?
   6.        Were managers directly responsible for the success of the                           Yes
             venture ?
   7.        Were objectives clearly articulated to all stakeholders?                            No
   8.        Did both companies adequately prepare for the venture?                              No
Source: Anthony J.Delmonte, Richard V.McCarthy, "Offshore Software Development: Is the benefit         57
                                       worth the risk?"
Duty-Free Shop
     Group


                 58
         Duty-Free Shop Group
• Founded in Hong Kong in 1961 by Robert
  Miller and Charles Feeney

                          Mr. Miller

• Now based in San Francisco
• LVMH acquires 61% of company in 1997
  Source: Ginsberg, Steve “Flashy store less than heavy-duty success for DFS.” San
     Francisco Business Times 22 Dec. 2000 – retrieved from the WWW 4/15/04
                                                                                     59
          Duty-Free Shop Group

• Operate 150+ on and off-airport stores
   in tour and travel destinations
• Locations worldwide and U.S.
• 5,000+ employees
• Annual sales of $1.8 billion


Source: DFS Galleria. April 2004 DFS Galleria. April 15, 2004
<http://dfsgalleria.com/>                                       60
          Duty-Free Shop Group
• Retailer of fine liquors, tobacco products,
  fragrances and luxury items.




Source: DFS Galleria. April 2004 DFS Galleria. April 15, 2004
                                                                61
<http://dfsgalleria.com/>
          Duty-Free Group
• Primary concern is managing supply from
  production to point of sale.
• By 1999, legacy system in use 15 years.
• Japan market doldrums paired with weak
  European currencies cause slump in
  profits.
• 9/11 air traffic slowdown further
  emphasized need for cost-saving.
           Source: Ginsberg; DFS Galleria website
                                                    62
                  Duty-Free Group
• Due diligence started Eastern Europe
   – Problems with political instability
   – Immature providers


• Ireland and Western Europe
   – Long-term cost savings absent


Source: Goolsby, Kathleen. Outsourcing Center. Offshore is not Offhand –
      Recommendations for Effective Offshore Outsourcing. 2002
                                                                           63
          Duty-Free Group
• Settled on India because of mature
  providers and presence of competition.
• Cognizant chosen primarily because of:
  – R&D capabilities
  – Flexibility
  – U.S. presence




                                           64
• Founded in 1994 in Teaneck, NJ.
• Specialize in Outsourcing and e-Business
  with 24/7 project support.
• Large R&D segment for assessing and
  administering change for clients.



                                             65
• Named ‘Public Company of the Year’ by
  New Jersey Technology Council.
• ‘Top Solution Provider’ in Business
  Week’s list of Hot Growth Companies.
• ‘Best Small Company in America’ by
  Forbes.



     Source: Cognizant Technology Solutions. 14 April, 2004
                                                              66
                    <http:cognizant.com/>
• Sales offices throughout U.S.
• Development offices in Chennai, Kolkata,
  Pune, Hyderabad and Bangalore, India.
• Based in U.S., 70% of staff located in
  India.


 Source: “Offshore Outsourcing Can Achieve More Than Cost Savings,”
                      Gartner.com. 16 April 2004
  <http://www.gartnerconnects.com/reprints/cognizant/CS-16-3520.htm   67
Chennai Offices




                  68
             Duty-Free Group
• Initial agreement signed in May, 2000.
• Cognizant employees provide on-site
  support for legacy systems.
• DFS minimizes exposure and Cognizant
  allowed to prove value.



  Source: “Offshore Outsourcing Can Achieve More Than Cost
             Savings,” Gartner.com. 16 April 2004
 <http://www.gartnerconnects.com/reprints/cognizant/CS-16-
                                                             69
                          3520.htm
          Duty-Free Group
                 Stage Two:
• Late 2000 – DFS extends scope to hybrid
   on/off-shore model.
• “Follow the Sun”
   - 2, 12 hour shifts, one onshore one
       offshore
   - Cognizant takes production support calls
       from data centers and business users

                                                70
• September 11, 2001
   - Travel & Sales plummet
• Reorganized from 7 IT regions to 1.
• Identified need to reduce costs of merchandising,
   supply chain and store systems.
•October, 2001 - DFS signs three-year global
   outsourcing deal (costs not released).




                                                      71
• Systems consolidated and grouped by
  business process.
• Cognizant responsible for all application
  support and new development.
• Entire process completed, within budget –
  in less than six months.



                                              72
• Why stop there?
• Mid 2002, Cognizant takes over support of
  Peoplesoft HR, SAP and Lotus Notes.
• Cognizant replaces internal and external
  websites.




                                              73
• Major piece of $100 million cost cutting
  and reorganization strategy.
• Significant reductions in application and
  support costs.
• Savings used to reinvigorate core
  competencies.



                                              74
• Cost reductions attributed to:
• Salary differences
• Smaller staff requirements due to system
  consolidation.
• Ongoing IT productivity improvements.




                                             75
76
              Did DFS meet the 8 best practices?
Practices                           Description                          Consequence


   1.       Did the company effectively manage their team at great           Yes
            distance?
   2.       Did managers visit the site while evaluating bids?                ?
   3.       Were the contracts signed shorter than 4 years?                  Yes

   4.       Were the contracts detailed?                                     Yes
   5.       Was there joint evaluation of the proposals by both senior       Yes
            management and IT managers?
   6.       Were managers directly responsible for the success of the        Yes
            venture?
   7.       Were objectives clearly articulated to all stakeholders?         Yes
   8.       Did both companies adequately prepare for the venture?           Yes
                                                                                   77

								
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