Versitae - Virtual Captive

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Adapting to a New Era of Global Leadership

Four Strategic Imperatives for GCC Success

 1. Building a Resilient Talent Strategy for Sustainable Growth

 2. Rethinking the Future of Work Beyond Remote Work Models

 3. Expanding Beyond Traditional Domains through Cross-Functional Expertise

 4. Redefining Location and Talent Strategies with a Focus on Sustainability and Inclusivity

Elevating the Role of India’s GCCs on the Global Stage

 The Genesis of GCCs in India

 Factors Driving the Growth of GCCs in India

1. Academic Strength and Talent Availability:

2. Mature GCC Ecosystem:

3. Government Support:

4. Cost-Effectiveness and Low Risk:

5. Success Stories and Growing Confidence:

 Versitae and Systems Plus: Pioneering GCC Success

 India’s Evolution as a Global GCC Hub

 Why Establish a GCC in India?

 Conclusion

 Understanding the Models: GCCs vs. Traditional IT Outsourcing

 Key Differences Between GCCs and Traditional IT Outsourcing

1. Strategic Control and Alignment:

2. Cost Efficiency:

3. Talent Management:

4. Innovation and Agility:

 Choosing the Right Model for Your Business

 Real-World Success Stories

 Conclusion

The Rising Popularity of GCCs

Key Benefits of Establishing GCCs

1. Access to a Diverse Talent Pool: One of the primary reasons companies establish GCCs is to tap into a diverse and skilled talent pool available in global hotspots. Countries like India and China are known for their vast pool of IT professionals, engineers, and other skilled workers. By leveraging this talent, businesses can innovate more rapidly, develop new products and services, and maintain a competitive edge in their respective markets.

2. Increased Operational Efficiencies: GCCs enable companies to optimize their operations by centralizing key functions in cost-effective locations. This centralization leads to improved coordination, better resource allocation, and streamlined processes, ultimately resulting in increased operational efficiencies. For example, many companies have reported cost reductions of over 20% by consolidating operations in GCCs, which enhances their overall financial health during economic downturn.

3. Enhanced Customer Experience: By setting up GCCs in different geographical locations, businesses can provide better customer support and services tailored to specific regions. This proximity to local markets allows companies to understand customer preferences better and deliver more personalized experiences, thereby enhancing customer satisfaction and loyalty.

4. Flexibility and Scalability: GCCs offer companies the flexibility to scale their operations up or down based on market conditions. This agility is particularly crucial during a recession when businesses may need to adjust their operations quickly to respond to changing economic conditions. By having GCCs in multiple locations, companies can redistribute workloads and resources to regions less affected by economic downturns, thereby maintaining continuity and minimizing disruption.

5. Boosted Innovation: GCCs are often established in innovation hubs, where companies can collaborate with local universities, research institutions, and startups. This collaboration fosters a culture of innovation and enables companies to stay ahead of the technological curve. Moreover, the diverse talent pool in GCCs brings fresh perspectives and ideas, driving innovation and creativity within the organization.

 GCCs as a Defensive Barrier Against Economic Downturns

 Real-World Examples of GCC Success

 Conclusion

1. Skilled Workforce: India boasts a highly skilled and diverse workforce, which is a significant draw for multinational companies setting up GCCs.
2. Cost Advantage: The cost-effective environment in India allows companies to optimize their operations without compromising on quality.
3. Innovative Ecosystem: A strong focus on innovation and technology adoption positions India as a leader in developing advanced solutions for global markets.

1. Information Technology (IT) Services: Leading the charge with cutting-edge technological solutions and services.
2. Banking, Financial Services, and Insurance (BFSI): Transforming financial operations and services through innovative solutions.
3. Healthcare: Driving advancements in medical research, health technology, and patient care.

1. Bengaluru: Often referred to as the Silicon Valley of India, Bengaluru is a hub for tech innovation and IT services.
2. Hyderabad: Known for its rapid growth, Hyderabad is emerging as a significant player in the tech and GCC space.
3. Pune: Gaining prominence as a preferred destination for setting up GCCs due to its favorable business environment.

1. Artificial Intelligence (AI) and Machine Learning (ML): India is at the forefront of developing AI and ML technologies, driving innovation and efficiency.
2. Digital Transformation: Enabling seamless integration and operation of global business processes.
3. Research and Development (R&D): Fueling the next wave of innovation and growth through robust R&D initiatives.

Understanding Global Capability Centers (GCCs)

Embracing Globalization for Resilience and Growth

The Talent Advantage: Accessing Global Hotspots

Enhancing Operational Efficiency and Customer Experience

Accelerating Innovation and Digital Transformation

Realizing Cost Savings and Competitiveness

Implementing GCC Strategy: Key Considerations

1. Strategic Alignment: Align GCC objectives with overall business strategy and long-term goals to ensure synergy and maximize value creation.

2. Location Selection: Conduct thorough research to identify optimal offshore locations based on factors such as talent availability, infrastructure, regulatory environment, and geopolitical stability.

3. Governance and Compliance: Establish robust governance frameworks and compliance mechanisms to ensure adherence to legal, regulatory, and ethical standards across GCC operations.

4. Talent Management: Invest in talent acquisition, development, and retention strategies to build high-performing teams and foster a culture of excellence within GCCs.

5. Technology Enablement: Leverage cutting-edge technologies such as AI, automation, analytics, and cloud computing to drive operational efficiency, innovation, and scalability within GCC operations.

6. Risk Management: Implement robust risk management practices to identify, assess, and mitigate potential risks associated with GCC operations, including geopolitical, operational, and cybersecurity risks.

Conclusion: Unlocking Growth with GCCs

Reach Out to Us

 Step 1: Define Strategic Objectives

 Step 2: Conduct Feasibility Study

 Step 3: Select the Right Location

 Step 4: Develop Operational Framework

 Step 5: Build and Scale the Team

 Step 6: Monitor and Optimize Performance

In the fast-evolving landscape of technology, Chief Information Officers (CIOs) are not merely stewards of IT infrastructure but strategic leaders driving digital transformation and innovation. Understanding the pivotal role of cloud providers in delivering cost-efficient services has become imperative for organizations aiming to stay competitive and agile.

Embracing Digital Transformation

Digital transformation is more than just a buzzword; it’s a strategic imperative for organizations looking to thrive in the digital age. CIOs recognize that embracing innovation is not an option but a necessity to stay relevant. This paradigm shift involves leveraging technology to streamline processes, enhance customer experiences, and drive overall business growth.

One key enabler of digital transformation is the adoption of cloud services. Cloud providers offer scalable, flexible, and cost-effective solutions that empower businesses to adapt to changing market demands swiftly.

The Cost-Efficiency Paradigm

Traditionally, maintaining on-premises infrastructure demanded significant capital investment and ongoing operational costs. The associated skills required for managing these systems added another layer of complexity and expense. Here, the strategic role of cloud services becomes evident.

Cloud providers offer a pay-as-you-go model, allowing organizations to scale resources up or down based on demand. This flexibility eliminates the need for large upfront investments in hardware and provides a more predictable cost structure. CIOs appreciate the agility and cost-efficiency that cloud services bring to the table, allowing them to allocate resources more strategically.

Data Center Exits and Cloud Migration

According to a recent CIO Pulse Survey 2023 of IT leaders, a striking 40% emphasized the critical importance of continued migration to the cloud and data center exits in the next 12 months. This highlights a collective recognition among IT decision-makers that reducing IT costs hinges on embracing cloud solutions and gradually moving away from traditional on-premises data centers.

Data center exits not only align with cost-efficiency goals but also reflect a broader industry trend toward leveraging the scalability and performance benefits offered by cloud providers. By entrusting certain functions to the cloud, organizations can redirect resources to core business activities, enhance innovation, and maintain a competitive edge.

Shifting IT Cost Paradigms

The cost implications of cloud adoption extend beyond the obvious operational advantages. With the cloud, organizations can benefit from regular updates and improvements to infrastructure without the burden of managing these upgrades internally. This dynamic shift in cost paradigms allows CIOs to focus on innovation and strategic initiatives rather than being bogged down by the intricacies of infrastructure maintenance.

Furthermore, the cloud facilitates a shift from a capital expenditure (CapEx) model to an operational expenditure (OpEx) model. This transition aligns IT costs with business outcomes, providing a more transparent view of how resources are allocated and enabling better budget management.

Leveraging Cloud for Innovation

Beyond cost considerations, CIOs recognize the intrinsic link between cloud services and innovation. Cloud providers offer a rich ecosystem of tools and services that empower organizations to experiment, iterate, and bring new ideas to the market faster.

The ability to access cutting-edge technologies, such as artificial intelligence, machine learning, and data analytics, via the cloud, enables businesses to stay at the forefront of innovation. CIOs understand that innovation is not only a driver of growth but also a means to differentiate their organizations in a competitive landscape.

Looking Ahead

As we navigate the ever-changing terrain of technology, it is evident that CIOs are steering their organizations toward a future where digital transformation and cloud services are not just advantageous but imperative. The strategic importance of these initiatives lies not only in cost reduction but in fostering a culture of innovation, adaptability, and sustained business growth.

In the coming months and years, we can anticipate a continued shift toward cloud-centric strategies, with organizations leveraging the expertise of cloud providers to enhance efficiency, reduce costs, and unlock new possibilities. For CIOs, the journey involves not just embracing technology but harnessing it strategically to propel their organizations into a future where innovation and cost-efficiency go hand in hand. Learn how we can help your organization navigate the digital skies with wisdom and foresight, ensuring a seamless journey toward innovation and success.

GICs have evolved over the years in terms of scale and delivery capacity in addition to business acumen, leadership maturity, and credibility within their global enterprise. As a result, their performance and stakeholder satisfaction have both improved. They are now reaching a stage where they can more fully appreciate the numerous unique advantages of this in-house model.

Until recently, GICs were viewed as low-cost aggregators for IT services and backend operations. Today, GICs have evolved as innovation drivers and value contributors by making new things possible. Today, there are multiple business success stories where GICs have played an integral role in accelerating growth.

In a nutshell, GICs are moving from working at a lower cost to collaborating in solving some of your biggest problems. This is how the journey and evolution of GICs have been seen so far.

GICs growing in maturity and a shift from execution to leadership:

1.Cost & Productivity continues to be important.

Cost optimization & productivity continue to be a focus area, especially while kickstarting new GICs for global enterprises. Despite the growing focus on innovation, cost optimization is still a core expectation from stakeholders and GIC leaders have to continue to deliver it.

• Industry trends indicate that the GIC model continues to deliver 40-70% savings and these cost arbitrage benefits are not going away anytime soon. These are very likely to be sustained for at least another 15-20 years, perhaps even running up to 20-25 years.
• However, GICs cannot afford to be complacent. Some of the initial drivers of cost and operational optimization benefits might start diminishing. For instance, managing the talent pyramid and the per-unit infrastructural cost efficiently was made simple by the exponentially high growth that many GICs experienced in their formative years. It becomes harder to control such costs as headcount growth plateaus. As a result, GICs must work hard to optimize their talent models and operations excellence in order to maintain and possibly even increase the benefits to cost and productivity.

2.Innovation and Value Addition:

There are tremendous opportunities for GICs to add value beyond the traditional focus on cost & productivity in back-office processes. There is significant momentum already in building strong capabilities in new and emerging technologies. In addition, GICs drive product/service innovation in developing markets.

Also, many GICs are leveraging the cost and talent optimization advantage to extend services to new segments and markets that were earlier not viable to serve for the parent organization. This is a transformational opportunity not just for GICs but also for parent organizations.

3.The methods of governance are changing.

In the past, GIC’s operational models have been at either the extreme of the shared services or vertical integration spectrum. There are more sophisticated, hybrid operational models emerging as a result of the expanding scope of GICs. This makes governance and controlling the matrix in particular, more difficult. Also, the organization-wide distribution of GICs is changing. Business Heads are now frequently taking a direct interest in the GICs instead of reporting directly to the COO or the CFO. As a result, in the framework of their global organizations, GIC executives’ roles and responsibilities are also expanding.

How we can help?

The Managed GIC model, also known as the Virtual Captive model, delivers you all the strategic advantages of a Global In-House center while reducing your legal risks, securing your intellectual property, and resolving your ongoing management challenges. Additionally, having access to a talented staff pool allows your managed GIC to act as your company’s R&D and Innovation Center, which will benefit your bottom line.

We have years of experience delivering this model for clients, and on average, they save 30% or more in costs compared to standard offshore. Reach out to us for a free consultation and a price comparison matrix tailor-made to your skill needs.

Historically, outsourcing has been associated with setups like captives of big corporations. These captives operate a full-fledged establishment in a low-cost location or managed services by a cost-effective Managed service provider(s) with exceptional capabilities to understand and execute processes. Managed services as a market have matured immensely in the last two decades. Established service providers with global footprints have proven their potency in managing operations, improving efficiency, and increasing margins big time.

The IT Outsourcing landscape has evolved immensely over the last few years. Historically, the two most common outsourcing models have been captives and the other being managed services.

Analyzing Captives Vs. Managed Services:

Let us analyze and break down the strengths and weaknesses of both these outsourcing models. Captives and managed services offer a distinct set of pros and cons.

The captive model offers operational control and transparency. It also enables a cultural alignment between the extended offshore IT team and the enterprise. IP protection is another primary benefit that captives bring to the table.

However, the Captive model has a much higher risk in terms of infrastructure setup. The captive model needs a huge initial investment to establish it from the ground up. The enterprise must take the onus of talent management- from acquisition, recruitment, and retention. Also, the responsibility of compliance with local laws and regulations falls on their shoulders.

When looking at the managed service model, the benefits and shortcomings of the captive model get exactly reversed. There is a lack of operational control, cultural alignment, and IP ownership/protection. However, the cost savings that the managed service providers offer are unmatched and are often the decisive factor in pushing their case.

So far, outsourcing decisions have been hanging in the balance of this pull-push phenomenon. Additionally, we have seen how turbulent the global pandemic has been over the last 18 months. COVID-19 has aggravated the need for better control and visibility of day-to-day operations with the entire world working from home, thereby pushing the case further in favor of captives.

The advent of the Virtual Captive Model:

Until recently, outsourcing decisions were on either end of the spectrum of both these models- either choosing a captive that offers control and ownership compared to managed services providers who come with cost benefits, and innovation.

The quest to extract the maximum value led to the advent of “Virtual Captives.” It strikes a wonderful balance between control, cost, and innovation.

A Virtual Captive model is a “people first” outsourcing model which is fundamentally all about providing the right talent at the right time and at the right price. Virtual Captive teams have more experienced resources and are a lower turnover model that offers better knowledge retention and intellectual property protection than legacy providers. Finally, Virtual Captives are built and sourced from scratch and belong exclusively to a client therefore the risk of dependency on the legacy provider is greatly reduced.

The Virtual Captive model operates with a speed and agility that can adapt to an organization’s changing business needs and typically costs 70% less than onshore talent and often 40% less than traditional legacy outsourcing. It has been observed that even highly specialized and experienced teams can be built within the Virtual Captive model at rates as low as $20 per hour.

Virtual Captive as an offering is undoubtedly poised to gain popularity and momentum in the coming times due to the sheer value and advantages it promises to offer. Virtual Captives will be of great utility to clients who intend to gain back control and ownership of already matured and transformed processes that have remained with a Managed Services provider for long.

Post-pandemic, enterprises have been largely impressed with how IT service and technology providers have stepped up in terms of improving commercial models and customer-centricity.

However, talent management has become a big issue of concern for customers. They want providers to be able to ensure resource availability, improve employee quality, and manage attrition – all while dealing with the Great Resignation and the current labor shortage.

In order to maintain customer loyalty and satisfaction, it’s essential for service and technology providers to focus on talent management and providing value-add and innovation.

For enterprises, talent management and attrition are key focus areas that they want their IT service and technology partners to invest in. Enterprises expect their partners to ensure that the right talent with the right skills is available to them at the right time and at the right price.

What are the Enterprises looking for from their IT service providers?

Strategic Partnership:

Enterprises want IT service and technology providers to be more than just people who give you a service or product. Enterprises want them to be strategic partners with whom they can have a balanced, forward-looking relationship.

Innovation and collaboration:

Customers are looking for providers who are open to collaboration and innovative ideas. They want providers who they can work with to jointly decide the best way forward.

Control and transparency:

Customers want to see that their IT service and technology providers are responsive and proactive with high customer-centricity. They expect transparency and flexibility in project management, delivery, and commercials. In other words, customers want to know what they’re getting for their money and feel confident that they can rely on you to deliver what was promised.

How can we help?

At Versitae and Systems Plus, we continuously plan our workforce while considering the various elements that affect talent acquisition and output. We also take a more all-encompassing approach to managing employee attrition. By being employee-centric and investing in learning and development, we improve employee productivity and build an employee-focused culture.

We help you build an offshore extension of your IT team of skilled technology professionals who have the experience and expertise you need to improve your development process and output.

Reach out to us to know how you can leverage our Virtual Captive model to drive enterprise success.

Over the last couple of decades, we have witnessed explosive growth in IT outsourcing and India has been established as one of the major offshoring destinations with access to a wide, low-cost talent pool.

We have also seen the nature of services provided through outsourcing has evolved from mere cost arbitrage to innovative, business outcome-driven service offerings leveraging emerging technologies and paradigms to drive strategic value.

A trend observed across the IT outsourcing landscape is that the managed GICs are set to enable and sustain digital transformation.

The managed global in-house centers are currently in the initial stages of digital service delivery maturity but are beginning to lead the way in driving greater value to enterprise transformation.

During this period, the nature of services provided through outsourcing has also transformed from mere cost arbitrage to high-quality, innovative, and strategic IT solutions.

According to Eric Gordon, strategic technology advisor, and Managing Partner at Versitae, “ The more technology becomes embedded with business processes, the more technology then becomes part of the ongoing business as usual changes that are required to keep up with changing customers, changing business conditions.

So, a business can no longer implement a technology system and then just run itself without touching technology for the next several years. Now, technology is embedded with the process, BI and analytics, consumer-facing digital, and in a lot of different ways. So as the business needs to change and evolve, then everything becomes a technology project partially. What that means is you must have the talent, skills, and capability to iterate and evolve, your operating capabilities using technology.”

Eric says, “One and done projects are good, or over. That is how technology was run 20 years ago. Today, as a business evolves, changes its website, and needs to attract new and different customers, there’s an ongoing churn of technology capabilities that must be built, maintained, and enhanced which naturally takes people and that costs money. And so, this is where the virtual captive comes into play. Suppose you need these teams, and you need these people with the skills on an ongoing basis. Why not put them in a virtual captive and use the cost advantages you gain by doing that, to get very talented people that can drive value for your business at the lowest total cost of ownership? That’s kind of the magic of what a virtual captive can do for you.”

Furthermore, they’re effectively your team and resources. It’s just they’re sitting somewhere else. It works like any other remote team. So, you have got full control of what they do and how they do it.

Eric strongly believes that Virtual Captive can facilitate the process of getting into the next-gen technology adoption for enterprises.

The virtual captive model given the cost advantage provides an opportunity for the enterprise to invest in newer technologies at a significantly lower cost structure. Adopting newer technologies involves a certain amount of trial and error, along with research and development.

In the new business landscape, every company is a technology company.

“Every company that the private equity firms invest in, they view as a technology play, and how they can leverage technology. Well, sometimes it involves an amount of experimentation. So, you can get that on a more cost-effective basis, by leveraging virtual captive, and in many cases, business leaders, look at the cost of domestic resources, especially technology resources as huge barriers to doing things and so many times they just don’t do things because they can’t afford it. They can’t afford to keep those technology resources on an ongoing basis. And here’s

where the virtual captive model brings a tremendous amount of capability and capacity at just a fraction of the cost. So, it opens the doors for a lot of things, especially next-gen technology adoption”, according to Eric.

The Virtual Captive model, also known as Managed GIC, gives you all the strategic benefits of a Global In-House center while mitigating your legal risks, protecting your IP risks, and solving your day-to-day management issues. Plus, access to a quality talent pool means that your managed GIC can serve as the R&D and Innovation Hub for your enterprise and contribute positively to your bottom line.

We have decades of experience in operating this model for clients where our clients achieve 30%+ cost savings on average compared to traditional offshoring. Reach out to us for a free consult and a free price comparison matrix tailor-made to your skill needs.

In this webinar, you can explore some structural changes affecting IT organizations, and how you can shape your future IT costs and capabilities to address this new reality.

Talent typically consumes 45-60% of an IT cost structure, so if you aren’t optimizing your IT talent, you can’t optimize your costs.

The New Normal is here! IT leaders are back to the drawing board re-evaluating the Capability vs Cost matrix once again. Will the old glasses help you see the new solutions?

Enable RPA success with better strategy, better execution, and better governance.

Watch this webinar to gain insights on the correlation between Strategic Talent Management approaches and the factors that define the success and sustainability of RPA, scaling up to your advantage. 00

By “resiliency” we aren’t talking about things like disaster recovery. Rather, we are talking about the ability of an IT organization, or a company, to withstand a shock, survive it, and emerge with key capabilities intact.

Is your IT roadmap supported with the right capabilities to deliver on cost & outcome milestones?

Digital initiatives aren’t “one-and-done” projects. To go digital at a pace which is at par with the evolving marketplace IT strategy needs to balance in-house talent with strong external partners to ensure that they have the resources to deliver according to business needs. Best Fit partners facilitate co-creation and are involved from the get-go. They adapt to evolving requirements along with adherence to agreed-upon architecture-design principles.. With the supplier market being extremely fragmented, partners need to be transparent, collaborative and trusted. To know how we help our clients achieve the best fit, watch Eric Gordon, President, Versitae & Sapan Choksi, CEO, Systems Plus deliberate on the subject.

Managing your business’s security footprint is imperative today. A Hybrid SOC under the Managed GIC model helps in setting up a robust foundation with seamless integration and continuous optimization of processes. Right from security tool configuration to agent management and provisioning to monitoring processes as per changing technologies, this model gives you an end-to-end solution along with a 50 percent cost saving. Listen in to Eric Gordon, President, Versitae and Sapan Choksi, CEO, Systems+ talk about the nuts and bolts of this arrangement.

Boosting EBITDA on your mind? Explore a proven framework for strategic IT Talent Management, based on a cost v/s capability evaluation across diverse companies. Our detailed study of IT cost structures revealed that IT talent costs are consuming on an average 53% of the IT budget! Which only means that there is a huge opportunity gap, both in managing IT talent and costs thereof! For more such observations and unique approaches for optimising the cost of IT talent in your organisation, have a look at our recent webinar hosted by Sapan Choksi, CEO, Systems Plus & Eric Gordon, President, Versitae.

Technology is advancing at a tremendous pace today, and every business is now turning into an IT company of sorts. Digital transformation is the need of the hour, and the first word that comes to mind when we think of key enablers to digital transformation, is the cloud. Having a robust cloud infrastructure means you don’t need to invest in operational centers anymore. It directly impacts the money your business makes, boosts cost efficiency and increases scalability. That’s not the best part. Most cloud computing programs ranging from CRM to productivity suites to ERP also come with flexible payments, thus making this entire process more OpEx friendly. The cloud also supports the workforce by easily enabling virtualized environments where team members can more or less set up workstations anywhere and everywhere. With seamless disaster recovery, commercial & technical flexibility, storage space and fast application deployment, digital transformation remains incomplete without a proper cloud setup.

There is another side to the story tough. The biggest hurdle CIOs probably face, is that businesses know that they need to transform digitally, but they are on tenterhooks when it comes to deciding on how or where to start. It’s their job to identify the correct drivers, motivations and improvement areas to develop a cloud strategy that fits well within the existing digital ecosystem. Licensing and bandwidth costs, storage capabilities and complex data integration all need to be charted out, and of course, none of this can happen without a skilled technical team to supervise these implementations in real time.

It’s important to think about building cloud systems in a manner that allows emerging technologies to be plugged in as they arise. CIOs should also be thinking about creating best practices that can be reused, adding to the scalability factor. It is also important to put data governance and quality at the heart of your business strategy, else it’s simply “garbage in, garbage out” which will impact business performance down the line. As more than half of IT spend becomes cloud based and security takes the lead, tech leaders also need to take care of rules like GDPR when devising cloud strategies. Only when you can ensure your end-customers that their data is safe and secure can you consider this transformation fruitful.

There are other important questions that need to be asked. What part of your traditional infrastructure do you migrate first, since shifting it all at once may not possible? What are the potentially hidden costs? Do you want these DX efforts to take over traditional IT, or do you want a mix of both? There are so many models to pick and choose from, that you might end up getting confused. Choosing between SaaS, PaaS and IaaS is the first step. Think of it as choosing whether to dine out, get dinner home delivered, or cooking it yourself.

1. Dining out, or SaaS: Most control here lies with the service provider. At this level, there is no software installation involved. Something as simple as being able to operate environments through browsers is SaaS
2. Getting food delivered, or PaaS: Here, you don’t think about the servers or the internals, and this is better suited to develop and deploy applications
3. Preparing dinner yourself, or IaaS: This is where you are typically using virtual machines on someone else’s servers rather than your own. Of course, the food you cook yourself comes with an innate satisfaction that dining out cannot compare with, but it also complicates things a bit

Let’s take the example of the fast food giant McDonalds and their digital transformation journey. With one of the biggest supply chains in the world, every order adds on to the customer data being collected. With more than 100 markets, 1000 integration jobs and 10,000 users across technologies, siloed data became a problem and reducing friction was imperative. They used native services from AWS as their primary cloud solutions, but also backed it up with Azure for its data analytics capabilities. Thus, they set up a seamless multi cloud set up and within the course of a year were able to create a platform that helped them scale up while ensuring proper data compliance, governance and security. That’s what you call innovation.

Another critical decision is to decide whether one should be on public, private or hybrid cloud. While public cloud is easy to manage and offers increased scalability, a private cloud brings greater control and better security for mission-critical data. Hybrid cloud brings the best of both worlds, merging public and private cloud for lower total cost of ownership (TCO) and enhanced security. Some applications may need to remain on-premises or in a private cloud due to security and regulatory requirements, while other data can be more easily stored in the public cloud. This is where typically choosing the right service provider to support these decisions becomes critical.

Most businesses seem to be migrating towards a hybrid cloud arrangement because it’s the perfect combination of efficiency and effectiveness. It allows you to transition at your own pace and simplifies things a bit because moving applications is not just a lift and shift. It allows you to start small. A public web site, a small application with few security requirements or something as simple as your office automation tools – think where you are headed and then start the transformation. Educating your entire organization about the pros and cons of hybrid cloud is also up to you, otherwise these efforts are as good as futile. Moving to the cloud is not an IT decision, it’s a business decision. Knowledgeable support is the need of the hour because ultimately it is the operational teams that will drive this forward.

Mostly, businesses opt for the big three, namely AWS, Microsoft Azure and Google cloud. However, there’s also a new kid on the block. In only a few years, Alibaba cloud has made its mark. How you choose between these providers depends on whether you are looking for entry level solutions or enterprise level growth.

For high-end computational services, it does not get better than AWS which comes with pay-as-you-go services along with over a hundred different offerings. However, you will need to be familiar with the hybrid cloud infrastructure to determine how the AWS suite of services can be best utilized during migration. While, overall, AWS is easy to use and has one of the simplest operating consoles, you may have a bit of an issue with data movement. When it comes to testing tools and building IoT apps, the private cloud backed Azure is another viable option especially now since it’s compatibility with non-Microsoft platforms has improved tremendously. Alibaba cloud has had a growth trajectory which is unparalleled and with more than 360,000 transactions per second, its capabilities are directly competing with AWS, however their presence has predominantly been Far East based and their local service centers have not been around for as long as the rest of the players. Each of these services have their set of pros and cons and it takes specially trained solution architects to define which is the “right” way to go for your organization.

No one said it would be easy, but innovation and disruption is the only way ahead. While the road to a successful cloud migration is daunting alone, the journey becomes easier when you have someone to guide you through. With more than three decades of experience in legacy and record-based systems, traditional architecture, hybrid environments, we’ve seen it all. Our gamut of technical capabilities extends across cloud consulting, cloud architecture and management, enterprise cloud solutions, containerization & microservices and helping businesses chart out customized adoption frameworks. You don’t have to look much further to #GetITRight!

According to Gartner, IT spending backed by the cloud will cross $3.7 trillion in the next two years or so. While that’s a huge number it’s not that surprising. Ever heard of organizations taking up digital transformation without using the cloud? I surely haven’t. Everyone is understanding the true value of disruption, and technologies like AI and IoT are seeing increased consumer demand today. This means that the demand to leverage the cloud within organizations is also on the rise. Public cloud platforms like AWS, Microsoft Azure, Google and Alibaba Cloud have already made a mark for themselves in this rapidly changing technological landscape, and rightly so. They offer businesses a chance at better investment value, higher delivery speeds, increased agility, better storage options, and typically costs less. Works like a charm, right?

It sounds simple, but really, it isn’t. I’ll tell you why. Most businesses look at the cloud as one entity, but that’s not the case. The cloud is not just one platform. It is an integrated system of different hardware, software and logical links that work together to collate data and bring it to the end-user. Many organizations also feel that migrating legacy infrastructures on to the cloud may be a boon for them, and hence, rush into it. This is where they lose out.

Let’s talk about spend first. For example, AWS offers pay-as-you-use services along with easy scalability, which is a great or obvious reasons. You only pay for what you use, so spends are ideally optimized. But here’s the catch. Without technical experts on board, analyzing cloud costs to run a given service becomes difficult. You may end up paying for unneeded options, and forego ones that would actually be beneficial. Sometimes, cloud-service bills may also be vague, so you simply don’t get the data you need to understand what’s driving the spikes and dips in costs. Research says that almost half of compute resources that organizations sign up for are used for non-production purposes, and the majority of servers used for these functions only need to run during the typical 40-hour work week, not 24/7. If that’s the case, you may end up losing out on a lot of money!

Moving on to the utilization front, while a key advantage of moving to cloud is that you have unlimited capacity, enterprises often buy more capacity than they need, to ensure that they have enough resources to handle technological expansion. Then come applications. While planning computing resources, application owners will typically go by the data they have in hand from physical server days (because they don’t really have a precedent) as well as some assumptions around perceived business needs they see coming. And, since this estimation is made keeping in mind the worst disaster and the best growth scenarios, there is ample risk of over provisioning. In fact, no resource restriction actually serves as a motivator for over provisioning.

Published analysis suggests that in the current scenario, many organizations that take up cloud migration do not utilize more than 10 percent of its potential. The best case scenario is a utilization of 30 to 40%. Right Size Cloud Capacity is therefore a necessary consideration, if you really want to maximize cloud value.

So how do you make sure that your cloud resources are being utilized optimally?

A few critical things need to be kept in mind before taking this leap: how much are you spending now and hence willing to spend, how you will sustain peak efficiency with business drivers, and how will automation impact the day to day functioning of your organization?

The first step to solving the puzzle is to choose what kind of a cloud model you would want for your business. For eg: If you are a large scale multinationals, the hybrid cloud could be the most viable.  It gives you better flexibility in terms of deciding on the best combination of pay-per-use public cloud, private cloud and an on premise presence. For one, the migration itself becomes staggered and you get the space to decide on a pace, including, giving your internal team the time to come up the curve. To add to that, cloud automation and monitoring tools help you control extra costs and maximize resource utilization. For example: following the capacity versus utilization curve by AWS might be a good start for you to draw a parallel between your demands, budgets and the level of scalability that you are looking at for your business. This will also guide you to move from an infrastructural mindset to an overall IT centric approach.

All of this sounds easy on paper but when you start getting your hands dirty and implementing these changes, it can get really complicated. You can have all the tools and automated processes set in place, but if you don’t have a core, skilled team driving the move, it can very quickly turn into a veritable battleground. Yes, technology has overtaken every other industry with the pace at which it is evolving, but human learning and understanding is irreplaceable.

A lesson learnt in our three decades of experience within the traditional IT framework, with legacy systems, and now with the digital tech following a more agile development model. When it comes to the cloud there will always be difficult questions, but we have managed to answer them all, right from cloud architecture management, cloud migration to enterprise cloud solutions and cloud consulting. We’ve been helping our clients #GetITRight for decades!

In todays’ hyper-paced business environment where continuous delivery and continuous innovation have become a norm, CIOs must take a continuous approach to budget optimization as well. With so much c-suite thrust on balancing innovation with cost and delivery, it’s safe to assume that this is continuously on their mind! While the technology itself dominates the narrative when it comes to budget allocation, the people who manage and deliver the technology is an equally important aspect that can not only contribute to cost arbitrage, but also deliver immense value to the enterprise.

For this it’s important that IT leaders take a more strategic view of talent acquisition and management (both internal and external), unlike the tactical approach they usually take. We recently did a study of IT cost structures to help our clients understand how to think about their overall IT costs and how to use the right talent management strategy to free up budgets. The study was conducted across diverse companies and revealed that total IT talent costs are consuming on an average 53% of the IT budget! This points to a huge opportunity gap, both in managing IT talent and costs thereof.

A managed GIC sometimes referred to as the managed captive model is a proven framework for plugging these gaps and creating more value for your enterprise. It gives you all the strategic benefits of a Global In-House center, while mitigating your legal risks, protecting your IP risks and solving your day to day management issues. Plus, access to a quality talent pool means that your managed GIC can serve as the R&D and Innovation Hub for your enterprise and contribute positively to your bottom-line.

Versitae and Systems Plus together have decades of experience in operating this model for clients where our clients achieve 30%+ cost savings on average compared to traditional offshoring. Our experience allows us to refine our approach and fine tune our processes to make it easy and efficient for clients to adopt the MGIC model. From team design to Sourcing and Onboarding to managing the entire talent lifecycle, we can help you with end-to-end operationalization of your strategic talent pool.

The benefits of the MGIC platform are many – Not only is it a fully transparent model with complete control, but it’s also EBITDA accretive. Additionally, the MGIC platform gives you access to high quality tech talent with deep domain expertise in emerging areas like AI, data science and cloud. To discover it for yourself, reach out to us for a free consult along with a free price comparison matrix tailor made to your skill needs.