Case study: Application Management Outsourcing

In 2009 the Supply Chain division of DHL launched a number of projects to rationalise and improve the effectiveness of its delivery of IT services. As part of this initiative was the intent to rationalise the management and support of various core business applications. PROLOGS, the primary Warehouse Management System, was identified as one of the applications to be assessed and a detailed review was performed by a joint Quantum Plus / DHL team during Autumn 2009 of the current support arrangements for PROLOGS across Belgium, the Netherlands, Nordics, Central Europe and Eastern Europe; this confirmed that there was a significant opportunity for rationalisation and the achievement of cost savings through the outsourcing of this support service to a specialist third party organisation.

In 2009 the Supply Chain division of DHL launched a number of projects to rationalise and improve the effectiveness of its delivery of IT services. As part of this initiative was the intent to rationalise the management and support of various core business applications. PROLOGS, the primary Warehouse Management System, was identified...

as one of the applications to be assessed and a detailed review was performed by a joint Quantum Plus / DHL team during Autumn 2009 of the current support arrangements for PROLOGS across Belgium, the Netherlands, Nordics, Central Europe and Eastern Europe; this confirmed that there was a significant opportunity for rationalisation and the achievement of cost savings through the outsourcing of this support service to a specialist third party organisation.

Quantum Plus was then asked to project manage the selection of an outsourcing partner, working with a small team of DHL IT staff. This was conducted as a competitive process, with the intent of identifying a strategic partner who would have the potential to take on other outsourced services in the future. The scope of services covered both the application support activities then performed at a country level and those already centralised. An RFP was developed and issued to ten service providers. The responses were evaluated and three service providers selected for more detailed assessment, including service providers presentations and reference visits/calls. Following due diligence and the submission of final tenders, HCL was selected as the preferred service provider. The contract for the new outsourced service was developed during the latter stages of the selection project, utilising a number of schedule templates provided by Quantum Plus.

Quantum Plus subsequently performed a review role during the three month transition period and worked with DHL staff to develop and implement a new set of governance processes for the future outsourced service model.

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