Recruitment services company Alexander Mann Solutions (AMS) is harnessing cloud computing and expanding nearshore IT services to cut costs and improve service levels while retaining a one-man internal IT department.
The company has just completed the migration of its global IT infrastructure into a private cloud and has sent more IT services to nearshore locations to reduce costs and improve IT service levels.
John Wainwright, global head of IT at AMS, says both nearshoring and cloud computing were obvious choices for a global company with 1,600 staff but only one IT worker.
Expanding overseas IT provision was nothing for AMS to fear because it already had services provided from nearshore locations through a historical relationship with an Eastern Europe-based supplier.
In 2000, AMS’s internal IT department spun-off to become an IT service provider. Concise, as the company was known, continued to serve AMS, later moved to Moldova and then acquired a company in neighbouring Romania to become Endava. It now has about 700 staff with over 500 in Romania and Moldova offering application development and testing services as well as managed services and IT service desks. Today it boasts companies such as Cadbury and Sky as UK customers.
Low-cost, highly skilled IT labour and a relatively close proximity to the UK is making Eastern Europe an increasingly attractive destination to UK businesses for offshoring IT services.
The legacy of the former Soviet region's engineering-based education system has fueled a rapid increase in the number of companies providing IT outsourcing and software development services in the region, according to the Central and Eastern Europe Outsourcing Review 2010.
AMS last month completed the migration of its global IT infrastructure into an Endava private cloud as part of a project to cut IT costs by 25%. Microsoft Windows 7, SharePoint, Exchange and finance applications were migrated to Endava’s global cloud. The project, which saw the infrastructure moved from servers hosted by Endava to its private cloud took four months to complete.
The company has achieved the 25% savings while service levels now deliver over 80% service resolution at first point of support.
Wainwright says the largest chunk of the savings comes from the company having more services completed in Eastern Europe. For example AMS previously had first-line and second-line IT support completed in Eastern Europe but now also has third-line support done from there. He said Endava also used to do project work from the UK but AMS now gets this from Moldova and Romania.
The other savings came from using the Endava cloud platform. The combination of pay-as-you-use computing power and the removal of the need to refresh hardware offshore have made the ambitious cost-cutting target possible.
Previously AMS had its servers hosted by Endava in its datacentres and would periodically pay for new hardware. This is no longer the case as the company uses Endava’s private cloud and only pays for the capacity it uses.
For example, the company has just upgraded its email. “Previously we would have had to invest in new hardware but because it is on Endava’s cloud platform we did not have to,” said Wainwright. He estimates that this alone saved about £35,000.
The cloud, like nearshoring, was not something for AMS to fear because of past experience. Wainwright says the company already used business applications delivered using the software-as-a-service model. “We have for some time thought that the cloud was good direction to go for us. What is important to us is where the data is hosted. It has to be hosted in the EU because of data protection regulations.”