Monday, April 22, 2013 Outsourcing Center
Colliers International, a commercial real estate firm, faced this business challenge daily: one of its brokers based in Asia wanted to do a deal with a broker based in the USA to lease two floors of a building in Europe. “We had to make our local information available to our entire workforce,” recalls Veresh Sita, Global CIO. He says a large part of the company’s business strategy was to make its local workforce able to do global deals. “We had to find a way to have technology drive a culture of collaboration and leadership in sharing knowledge,” he explains.
The business challenge was Colliers International is highly decentralized. The company has 522 offices in 62 countries around the globe even though the business of real estate for a specific client can center around just two blocks.
In addition, the company, which also does facility and property management for its clients, grew by acquisition. We know how that works, that’s right, each business had its own IT function. When Sita accepted the CIO position five years ago, Colliers had 46 different PBX systems and 15 exchange environments in North America alone. “This was really inefficient,” he says.
So his first task was to consolidate and standardize. Next up: transformation.
What kind of provider would work best?
Traditionally, real estate has been “very old school,” Sita notes. Technology adoption has been slow. Now, however, transformation at Colliers has happened as fast as the ink drying on those leases. “IT transformation used to center around faster, better, cheaper. Today it’s just faster, faster, faster,” says the Colliers CIO.
The IT leadership started searching for delivery models. “We needed a nimble and agile solution,” he says. They also realized that in this “new age of social media, cloud and mobility, no IT service provider was a true expert in this space.” So Colliers sought an IT partner with which it could build the new competency together. “That meant we needed a provider whose operating model was flexible,” says Sita.
He rejected the large Tier 1 global providers because he felt they were still operating with an outdated playbook. “We needed someone who would rewrite the playbook with us.”
Instead, he felt the Tier 2 providers “were open and authentic.” He said they “were willing to put the time and effort necessary to build the competency with us.” Vivek Gupta, the chief executive, global infrastructure management services of Zensar, Colliers’ provider, says one of his customers told him “The reason we like to work with Zensar is that you are big enough to deliver but small enough to care.” He says that comment has become the provider’s tagline.
Sita says he likes the fact he can pick up the phone and call the CEO of Zensar “almost any time of night or day to talk about a project manager.” His previous experience with a Tier 1 provider was he had to complain to someone in management before he could actually talk to a decision maker.
He appreciates Zensar’s alacrity. He says he has had an idea and called the leadership at Zensar to tell them about it. The next day the provider had mobilized a team. Fifteen days later they delivered the code. “That’s the speed we have to work at,” says Sita.
In his opinion, “only Tier 2s can do all this.” He praises their flexibility but also appreciates their maturity, discipline and best practices frameworks. “They are past the white board and blue sky stage,” he explains.
Sita says he uses the larger Tier 1 players for thought leadership and “aspirational work.” Then he hires Tier 2s to execute. He currently has also given work to a Tier 3 provider primary for labor arbitrage. “We get the mundane work done at a lower cost,” he says.
Today the Colliers/Zensar team “has transformed the entire infrastructure of the company,” reports Sita. “We now have the greatest technology on a global scale in our data center and MPLS,” he continues.
He says Zensar’s input was critical in architecting and engineering the IT. It helped Colliers implement the changes. Now the provider is Collier’s primary managed services partner.
Colliers just added help desk to its statement of work. “We are also expanding our ADM,” he says. The ‘stickiness’ of outsourcing relationships
Sita says he started using Zensar two careers ago. He was attending an Oracle user group conference and met Zensar’s CEO. They had an informal conversation. He was impressed, so he gave Zensar a small, one person project. After its completion, the relationship “grew quickly.” He believes that his former company, a manufacturer, is now one of Zensar’s largest accounts.
He joined Colliers on a Friday afternoon and called the Zensar CEO. By Monday morning the service provider had assembled a team. Together buyer and provider built the road map they are still following today. “I just picked up the phone and made it happen after I changed jobs,” he recalls.
Zensar, which is based in Pune, India, currently operates across 140 countries worldwide. It services Colliers from global delivery centers in:
Johannesburg, South Africa
Westborough ( MA) US
Sixty percent of its work is applications development and maintenance, according to Gupta. About a third is infrastructure management. The rest is BPO, basically transaction processing to support its applications customers.
Gupta says the provider has grown 25 percent year-over-year for the last five years. It has been able to retain its “nimble small company” flavor as it grows by creating strategic business units which each have their own profit and loss accounting. “Managers run their units as if it were their own company. The people who run it determine its destiny,” he explains. For example, they determine what kind of customer to go after and what services to offer.
The Zensar Chief Executive says leadership is careful not to build an ivory tower. “We don’t ever want to lose our close connection to the customers as we grow,” he says.
The combination of nimbleness and maturity that Tier 2 providers have helps each player in the partnership be successful in the current transforming business landscape.