For example, a large bank has recognized that its employees have differing training styles and training needs. If executives need to use systems, which in this organization is infrequent, a trainer is dispatched to deliver training one-on-one.
Although traditional classroom training is still offered, the bank has migrated toward multimedia training where a computer is coupled with video and audio. The bank has found multimedia training to be effective because of the richness of the media and because it allows people to try out the system and make mistakes. Another advantage of the computer-based multimedia training is that it allows people to complete the training when they need it, not on a schedule.
THE COSTS OF IGNORING USABILITY AND TRAINING
ISSUES
The investment firm scenario provides an example of the types of problems that can emerge when the end-user perspective is ignored; however, there have been a number of studies identifying the high costs associated with end-user difficulty with new systems. One study in particular by Nolan, Norton & Company reported by CIO
magazine examined the costs of end-user computing over a six- month period. The study involved ten major companies in a variety of industry settings, including Ford Motor Company, Cigna Corp., and Xerox Corp. The study found that the measured cost per workstation ran from $2,000 to $6,500 per year, which included the cost of PC and LAN hardware, software, peripherals, dedicated central IS personnel, and technology and personnel support of the host or server environment. It was emphasized that these were the measured costs.
The startling conclusion of their study was that the so-called unmeasured costs, which consisted of “peer-support costs,” averaged two and one-half times the measured costs, or from $5,000 to $15,000 per year. Peer-support costs comprise the time value of non-IS personnel who render guidance and assistance to their peers in the use of applications.
Lack of application fit with the end user and lack of proper training programs are the main culprits of the peer-support phenomenon. As the use of systems continues to extend to a broader and more diverse population of end users, these hidden peer-support costs, as well as the costs of outright implementation failures, will continue to grow.
CONCLUSION
This chapter opened with a description of a company that had considerable difficulty rolling out an important new system to its portfolio analysts. The cause of the problem was lack of consideration for the classes of users. Also, training prior to the rollout was not emphasized to the degree that it should have been.
Three factors that affect the fit of the application and the end user include the relative advantage, technical complexity, and compatibility of the system from the end user’
s perspective. Systems developers often neglect to consider these elements properly. They have become more important over time as information technology has evolved from central control to the democratization of computing, putting users in direct contact with both input and output.
Furthermore, the advent of business process reengineering and client/server computing has created additional users out of those who formerly handed off computer contact to others. The use of systems prototyping and gaining early user feedback are critical to successful system rollout. Also, the development of a usability lab can be an effective tool to assess user reaction before systems roll out.
Multiple interfaces to handle different classes of users are also helpful.
Organizations should preplan training programs to be implemented before new systems are rolled out. Training should emphasize flexibility of timing and approach, and should be carefully tailored to the intended audience. People learn differently depending on their individual cognitive styles. One size does not fit all; yet in many cases this truth is not heeded because of timing or cost considerations. The stakes are high when the hidden costs of a user workstation exceed the known costs — a situation greatly influenced by lack of proper attention to the usability of systems and effective training programs.
Section IV: Effectively Managing Outsourced Projects
Chapter List
Chapter 24: A Practical Guide to Staff Augmentation and Outsourcing Chapter 25: The Essentials for Successful IT Outsourcing
Chapter 26: The Management Service Provider Option
Chapter 27: Managing the Risk of Outsourcing Agreements
Chapter 28: Hiring and Managing Consultants
Chapter 29: How to Manage Outsourcing for Best Results
Chapter 30: Outsourcing as a Means of Improving Process Maturity: An Approach for More Rapidly Moving Up the Capability Maturity Model
Chapter 24: A Practical Guide to Staff
Augmentation and Outsourcing
Christine B. Tayntor
OVERVIEW
Almost from the inception of information technology (IT), back in the dark ages when the function was called data processing, the use of contract staff has been a fact of life for many companies. These outside “consultants,” as they are sometimes called, have consistently provided a variety of services, augmenting permanent staff.
In the early days, contracting was the only method an IT manager had of obtaining additional manpower or specialized services. Over the past decade, however, a new word has entered the IT lexicon. “Outsourcing” has become a popular method of obtaining IT services.
Although there are similarities between the use of contractors and outsourcing firms, the two types of services have fundamental differences. This chapter defines the services, differentiates between them, and suggests the functions where each is most appropriately used.
DEFINING STAFF AUGMENTATION AND OUTSOURCING
Whether called contractors, consultants, or rent-a-body firms, the primary function of these IT service providers is to supplement existing IT staff. They are typically engaged when the IT department is unable to obtain or retain permanent staff, or when it needs specialized skills for a short period. As may be surmised from the term
“staff augmentation,” contractors function as members of the department, taking their day-to-day direction from IT managers. Except for the fact that their paychecks come from a different company, and that their assignments can be terminated on short notice without cause, contractors are virtually indistinguishable from other members of the IT department.
Although some companies have exclusive agreements with one service provider, it is more common for a single IT department to use contractors from a number of firms.
The reason for the use of several firms is the IT manager’
s desire to find the
individual whose skills most closely match the department’
s needs. That is because
the key comp onent in staff augmentation, as in permanent staffing, is the individual person. Success or failure tends to be measured at the task level, and is dependent on specific staff. Because of this focus, when it contracts for staff augmentation, IT
faces many of the same risks that it does with its own staff. Contractors may not perform as expected, or they may quit before a project is complete.
Contractor agreements are frequently informal, and, while engagements may be long-term, many are of short duration. From a contractual perspective, staff augmentation can be viewed as the dating stage of a relationship.
If staff augmentation is dating, outsourcing is marriage. It is legally binding, is typically monogamous, has long commitments, and — in most cases — divorce
clauses. In contrast to staff augmentation, outsourcing focuses on services rather than individuals, and success is measured at the engagement level.
Some IT departments use a manufacturing analogy to describe outsourcing, explaining that they have chosen to “buy” a service rather than “make” it in-house.
They argue that this is similar to the situation where a plant might choose to buy a standard part rather than make it itself. The analogy is valid; the risks and rewards of outsourcing IT services are similar to those of buying parts. Just as a manufacturer may sacrifice the ability to customize a part for its use, but gains speed or cost savings by buying it, IT outsourcing involves similar trade-offs in flexibility against cost and speed.
Outsourcing differs from staff augmentation in several fundamental ways. When an IT department outsources, it turns over day-to-day responsibility for specific services to a supplier. Although overall accountability for the success of the relationship remains with IT, detailed management and direction is provided by the outsourcer, and measurement is not of individual tasks, but rather of compliance with service level agreements (SLAs).
By design, outsourcing distances IT from the service provider. Work may be done on-site, but it is frequently performed remotely, further reducing IT’
s involvement
with the service. Because outsourcing creates a distance between the IT department and the service it formerly provided, and because agreements are typically long term with penalties for early termination, companies do not undertake it lightly. It is normal to spend months going through a formal request for proposal (RFP) and selection process before actually beginning an outsourcing engagement. Exhibit 1
provides a summary of the differences between staff augmentation and outsourcing.
Exhibit 1.
Staff Augmentation versus Outsourcing Matrix
Characteristic
Staff Augmentation
Outsourcing
Formality of contract
Frequently low (or none at Normally formal
all)
Length of engagement
Typically short
Long (normally 2 to 5
years)
Time to engage/disengage Short (days)
Long (months)