4. Themes
Winner and Loser
Transition
Transformation
Exit Management
Due Diligence
Transfer of sub contracts and licences
Transfer of People
Transfer of Systems
Critical Success Factors
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6. “If you can keep your head
when all about you Are losing
theirs and blaming it on you; If
you can trust yourself when all
men doubt you, But make
allowance for their doubting too;
. . . If you can meet with
Triumph and Disaster And treat
those two impostors just the
same . . . Yours is the Earth and
everything that's in it.”
Rudyard Kipling
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7. Transition
Transition is the process by which an outsourcing service is
moved from an incumbent supplier to a new service provider
The customer will wish this to happen as smoothly as possible
with minimal interruption to its services
It will need to be planned carefully with all the critical activities
captured in a transition plan included in the contract with the
new supplier
The extent to which the new service provider inherits any
commitments such as service levels will need to be negotiated
The new service provider’s lack of familiarity with the services
suggest a grace period once it has taken over may be
appropriate
The timing of the payment of the service charge to the new
service provider should be agreed and linked to acceptance
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10. Transformation
Transformation is the process by which a new service provider
not only takes on an old service but also improves it
It requires a clear understanding of what transformation
activities will take place
The contract may contain commitments to savings which give
a measurable return to the customer
This will again need to be timetabled and is likely to take place
over a longer time frame
Agreeing new service levels and when they replace the
inherited ones is a critical factor
An acceptance process coupled with a remedial plan in case
of failure should be included in the agreement
One of the biggest challenges is roll out to a number of offices
The service charge will also need to increase proportionately
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12. Exit Management
The outgoing contract should contain an exit management
plan which has been kept up to date
This will specify what the outgoing service provider has to do
in order to effect a seamless transfer
It will also set out what charges may be paid for exit – which
acts as an effective incentive
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14. Due Diligence
“The Contractor should be given the opportunity to carry out
due diligence prior to the award of contract. Hence, the
Authority should not provide any warranties as to the state of
affairs at the commencement of the Agreement.”
So what does the Contractor need?
Access to previous contracts
Access to previous suppliers
Knowledge about what the current environment is
And how it can or cannot transfer
Electronic due diligence room provides the answers
But has to be properly populated
Cf. Corporate transactions
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15. Transfer of Subcontracts and Licences
Outgoing supplier must keep agreement register
Recognise there are different forms of software licences
Third party factor
Form of assignment or novation
Takes time – needs careful management and a joint approach
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16. •Transfer of People
Acquired Rights Directive
Common themes throughout Europe
Employee rights on transfer of an undertaking
Transfer of service in which employee is wholly or mainly
engaged counts
Consultation
Identification and management of contract risk
Should address
entry
steady state
exit
Mutual indemnity regime
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17. Transfer of Systems
Lift and shift
Swing kit – transfer from old to smaller version in same
location
Transfer data from old to new
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