Sourcing Strategy
Transcript: Purpose of this meeting: SHOW PROJECT'S PROGRESS Freelancing short-term fast coverage of capacity peaks flexible option for project-based engagements cover software adaptation or troubleshooting Business to Business long term careful evaluation and negotiation of contracts with future partners 1. Approach to Data Collection & Analysis Phase 2 Limitations 3. Business Model Selection a. Business to Business b. Freelancing 4.Regional Selection a. Poland b. Bulgaria c. Russia d. India e. Mexico 5. Overall Recommendation 6. Proposed Approach & Timeline 2nd Semester 7. Q&A Russia Strenghts: strong IT skills low wages good English skills economic ties governmental support for IT industry native talent and education system Opportunities: new market, as Russian IT sector is notable for pace of development 5. Overall Recommendation Bulgaria independent workers, NOT employees the payer has the right to control only the RESULT, not how and when it will be done LOGSOL GmbH = SME located in DD, offers web-based software solutions for logistic problems Looking for 3-4 additional software developers to cover capacity peaks, due to a growing demand for its customized logistic IT support systems Consulting engagement with University of Applied Sciences in Dresden to research suitability of Off-/Nearshore sourcing solutions as business strategy 3. Business Model Selection Data Collection & Analysis Phase Business to Business Weaknesses: huge labor turnover rate inefficient and corrupt bureaucracy lack of innovation concerning SME´s Threats: governmental interference with missing regard to infrastructure new competitors overall rise in cost Country Selection B2B solutions: 2. Limitations legal framework = working with contractors, independent professionals, interims and/or consultants from across all sectors Exclusion India - difficult to find a cooperation on eye-to-eye level Russia - IT sector not as developed as in other countries Future Focus Bulgaria, Poland - advantages of well developed nearshore solutions Mexico - rising star and strategic point of operation for penetration of US market Weaknesses: freelancer is unfamiliar with company little face-to-face contact between freelancer and client hard to develop loyalty Threats: data security "Blind Hire"- little contact during on boarding process Payment: wages dependent on country, task and skills International Business Strategy Team University of Applied Sciences Dresden 28.02.2017 Poland Weaknesses: legal and political uncertainty inefficient jurisdiction Threats: increasing wages (+5% in 2016) increasing shortage of skilled labour high competition for IT nearshoring solutions Freelancing 1. Approach Procurement: Freelancers are commonly hired through online platforms Situation Summery Business Strategy Project LOGSOL GmbH Development of an Off-/Nearshore Sourcing Strategy Interim Report Content Strengths: double-digit growth in IT industry strong IT education system well equipped IT workforce high number of possible collaborations close ties to Germany Opportunities: growing, innovative IT sector eye-to-eye level of motivated, newly found companies governmental subsidies Mexico Strenghts: short term solution no social security costs knowledge input Opportunities: possibility of long term cooperation higher productivity due to flexible working hours Previously agreed on focus: India, Russia, Bulgaria, Poland, Mexico Weaknesses: missing IT certification Threats: weak defence of intellectual property right corruption missing organizational skills VISA problems and political threats Purpose: development of a plan of action for the future implementation of a sourcing solution into LOGSOL GmbH's business strategy Deadline: week 26 of 2017 Focus: conducting further research and evaluating possible B2B partners in Poland, Bulgaria and Mexico evaluating freelancing as short and/or long term solution (focusing on job requirements and procurement) facilitating contact between LOGSOL GmbH and prospective freelancers / businesses abroad summarizing all findings, evaluations and propositions in a final report and presenting the results in a final presentation India = cooperation between two independent businesses making commercial transactions with another LOGSOL: long-term engagement with an independent enterprise opportunity to cover capacity peaks & focus on developing new products while maintaining a high standard of customer satisfaction Strenghts: governmental encouragement for this industry (software development parks) high quality standards cost-effective human resources high industry growth tax advantages Opportunities global market with possibilities to build up new networks outsourcing projects continue to rise Business Model Selection: recommendation for a combination of a permanent B2B cooperation and a flexible freelancing solution 4. Regional Selection Intellectual Property Right: exploitation right need to be regulated in the contract Employment Right: __________to