Posted by Greg Viola on September 11, 2013
On tap today at Workday Rising 2013 is a session I’m co-presenting with a client from Sony Electronics. About a year into its Workday implementation, Sony Electronics chose to use Deloitte Application Management Services (AMS) to help enhance the efficiency, cost-effectiveness, and overall value of its investment in Workday Human Capital Management. Our presentation today talks about the what’s and why’s of AMS in general, and Sony Electronics’ experiences specifically.
I imagine many of you may be asking why you’d even need a third-party AMS provider. One of the drivers for selecting Workday, or another SaaS solution, is to lower total cost of ownership, a significant part of which includes ease of configuration and ongoing maintenance. So if you have to hire an external third-party provider to help support your cloud solution, is it really worth it?
Certainly each organization should perform its own cost-benefit analysis before choosing a solution, whether ERP or SaaS or custom. While using a third-party AMS provider is not a “need to have” in a Workday environment, there are advantages that can make it the right choice for some organizations.
In general, third-party AMS both supplement and complement the support services Workday itself offers, as the following diagram illustrates. Workday handles hosting and infrastructure management; AMS supplements Workday capabilities (and an organization’s own in-house capabilities) in areas such as application development, management, and integration. AMS offers complementary capabilities in “big picture” areas such as governance, strategy, and Centers of Excellence devoted to Workday.
There are other advantages as well. Using an AMS provider gives companies access to current, continuously updated Workday-specific expertise to manage integrations, configurations, and ongoing maintenance and stay abreast of new features and functionality — capabilities an organization may otherwise have to develop and maintain in-house. From a cost perspective, outsourced application management has historically resulted in cost savings vs. in-house management.
An AMS provider can also offer a broader, deeper range of capabilities based on its experience with multiple Workday implementations, knowledge of leading practices, industry-specific knowledge and experience, and the like. Moreover, the just-in-time, just-what’s-needed aspect of using a third-party provider can be an important benefit. The volume of Workday application maintenance activities may not require the organization to have full-time employees dedicated to the effort, or perhaps those employees’ time and attention would be better spent on other activities.
Sony Electronics’ decision to engage Deloitte AMS was driven by several factors, including:
Service delivery models for AMS can vary according to an organization’s needs. In Sony Electronics’ case, the AMS team integrates seamlessly with the company’s operations. Sony Electronics’ service desk fields Level 1 inquiries and questions from users; the Deloitte AMS team handles Levels 2, 3, and 4 matters, ranging from providing Workday functional and integration support to performing maintenance to undertaking major enhancements and projects. Sony Electronics manages the HRIS applications and IT infrastructure, while Deloitte oversees governance and the project management office (PMO).
After engaging Deloitte AMS services for a pilot period to test the arrangement, gauge staffing requirements, and see whether it would yield the desired value, Sony Electronics opted to extend the relationship for another three years.
To those of you considering third-party AMS for your existing or proposed SaaS-based environment, we offer these lessons learned:
|Greg Viola is a director in the AMS Service Line of the Technology Service Area of Deloitte Consulting LLP. He has over 33 years’ experience leading and delivering a wide variety of IT engagements from strategy to delivery of long-term applications management and support programs.|
As used in this document, “Deloitte” means Deloitte Consulting LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.