The Aggregator
We enable YOU to run YOUR business smarter
By Piyush Rakhecha

The Aggregator

India continues to enjoy a dominant position globally in the 30-odd year old IT services offshoring/outsourcing business. This business accounted for export revenues of USD 33.5 billion growing by 22.7% over the previous year. In spite of this excellent growth, the basic structure of this business hasn’t changed over the years. The models on which this business is run is made up of large outsourcers, boutique firms and third party integrators (TPI).

First are the large IT services providers have built soup-to-nuts organizations that are better designed to support the large companies with major outsourcing requirements. Next, the boutique firms have built focused niche organizations that focus on solving one problem or on one technology. And finally the TPI’s who act as consultants that support organizations through the vendor selection process but are not responsible for the final output. These models have so far worked for the large and very large organizations that have big sourcing operations of their own and have the management bandwidth to manage multiple vendors, as well as, the large IT services providers.

The recent past has seen the emergence of Captive Offshore Delivery Centers (CODCs). Organizations with large IT budgets and IT servicesneeds are setting up their own offshore operations. The need for a greater control on the organization’s intellectual property, availability of in-house domain expertise and a tighter control on costs have been the key drivers for the setting up of these CODCs. The CaptiveOffshore Delivery Centers (CODCs) allow organizations to create a dedicated team – either own employees or from people supplied by vendors, while keeping closer management control.

The diagram on the left shows the various outsourcing models used by organizations today.

For smaller organizations that do not have large IT budgets or large management bandwidth to manage multiple vendors or to create their own ODCs, the only options left are option 1, 4 and 7 where services are delivered by the provider at the client location. While this provides some benefits, most of the benefits of offshoring /outsourcing are lost.

Smaller outsourcing and product development offshoring opportunities (10-50 people) face multiple issues.

  1. Typical attrition in India runs in the range of 15%-25% per year – in a 10 person team that’s 1-3 people leaving every year. This leads to knowledge retention issues
  2. Offshore requires substantial management oversight
  3. Larger customers always get preference – resources get pulled out from smaller clients whenever there is a crisis
  4. Key engineering skills are scarce and not available to smaller clients when required
  5. Limited availability of domain expertise
  6. Costs do not vary much by the type of skill required – skill required to do an Ad-hoc .Net report are very different from skills required to create/support a software product

What is required is another type of provider – “The Aggregator”.

The Aggregator
The Aggregator would act as an extension of the client organization. They would have an eco-system of providers that can provide a variety of skills and expertise levels.

The key characteristics of this provider would be:

  1. Strong program / project / service management skills
  2. Strong relationship with a variety of technology suppliers
  3. Strong knowledge management methodology
  4. Ability to match requirements with skill-set.
  5. Strong quality management skills
  6. Domain Expertise

A Typical Aggregator model is shown in the right had side.

The Client would contract with the Aggregator for various types of services – Solutioning, Design, Architecture, Project Development, Independent verification and Test, etc.

The Aggregator would select the right provider from its eco-system for the required service, manage the provider on behalf of the customer and get the service delivered.

In case the customer wants to set-up a dedicated team, the Aggregator would create an ODC with-in its premise and manage the ODC on behalf of the client. The Aggregator will:

  1. Provide the service management / project management capability
  2. Manage the team
  3. Ensure Knowledge management – ensuring no single point of failure
  4. Ensure optimal utilization of the team and manage demand
  5. Ensure that Client confidentiality is maintained and data is protected

In short the Aggregator will ensure that the client gets “Services in a Box” taking away the hassle of offshoring / outsourcing.

Demiurgic has created this model to support the customers. We have all the building blocks in place to provide the Aggregator services today.

What is required is another type of provider – “The Aggregator”.

  1. Consulting Services
  2. Project Management
  3. Program Management
  4. Service Management
  5. Knowledge Management
  6. Skills Management
  7. Contract Management
  8. Quality Management
  9. Test Verification
When a customer comes to us, we do a series of meetings and workshops to understand the customer and their requirements.

All the requirements are documented and signed-off. On the basis of the same, we will work out the best delivery mechanism and submit a proposal to the customer.

Demiurgic will take each of the requirements and identify the best way to deliver it – in-house or through one of the partners.

If the service is delivered by a partner, Demiurgic will work with the partner to set-up the team, provide the management and the governance. Demiurgic will ensure timely communication and updates to the customer

Depending on the service, Demiurgic can deliver it through one of more partners. As an example, in case a product has to be delivered, the initial engineering and architecture services can be provided by one partner and the build & Test services can be delivered by another partner while the test & verification service could be delivered by a third. The key consideration would be to find the best provider at the right price

In case an ODC needs to be set-up for the customer, Demiurgic will first define all the parameters for the ODC – skill-set, duration, types of services, Knowledge Management, security considerations, regulatory considerations, etc. Based on these a decision will be taken to either set it up in-house or set-it up with a partner. Either way Demiurgic would manage the ODC ensuring the service quality and delivery.