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Welcome to the Enaxis Consulting quarterly newsletter. The newsletter will provide you with updates about business, technology, and outsourcing trends. We sincerely hope that, as part of the extended Enaxis family, you will find the information useful and relevant. We will also use this opportunity to let you know about our offerings, white papers, and events. For additional information on topics covered in this issue, please e-mail info@enaxisconsulting.com.
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PRICING DATA CENTER CO-LOCATION SERVICES – GOING BEYOND THE INITIAL BID
 Most pricing models for co-location facilities are some combination of real estate, telecom connectivity, power, and labor. These costs are basic to any data center. While there are many other services outsourcers can provide, having a firm understanding of these basic cost components is critical to maximizing the value of any outsourced arrangement. In a recent white paper, we examine the challenges IT organizations encounter when assessing the competitiveness of an outsourcing vendor's data center co-location bid.
Some important factors to consider when evaluating a vendor bid include the following:
- Attention should be paid to how a provider accounts for power usage. Paying solely for space is rare. If power is not evident in the proposal, it is fair to ask where it has been embedded.
- Services are a major profit center for many providers. An understanding of actual needs can avoid instances of overpaying for unnecessary services.
- Cost is not everything. Other factors, such as geographic location, state of the co-location facility, and stability and quality of labor are equally critical and should be diligently evaluated before a move is finalized.
This paper examines three sample co-location bids received from different outsourcing vendors. By evaluating each bid in turn, we illustrate how additional fees or unexpected costs can impact monthly recurring costs.
To learn more about Data Center Pricing please review our white papers.
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SHOULD YOU CONSIDER OUTSOURCING NOW?
 Is a recessionary environment the right time to consider outsourcing? The answer is – it depends.
Although it seems counter-intuitive, companies tend to shy away from outsourcing during tough economic times. Why is that? There is a combination of reasons – ranging from the mentality of inaction during tough times to wanting to keep jobs locally in face of rising unemployment. However, it can be reasonably argued that a down economic environment is probably the best one to consider outsourcing as a cost-cutting and productivity-enhancing option, due to the following reasons:
- Need to restructure existing deals: If business is down, chances are that you do not need all the services you signed up for two years ago. With a well-written contract, decreasing services (and total cost) is not uncommon as long as you keep your minimum spend intact and do not incur penalties from the provider.
- Better Pricing: Data shows that since 2002 the offshore per FTE and total costs have been steadily rising – until 2008. Domestic and global providers have been very aggressive in their pricing and contract structures in 2009 in exchange for a steady pipeline.
- Leadership Support: As CFOs look under every proverbial couch for change to make quarterly numbers – the corporate leadership tends to be more supportive of the CIO’s effort to consider outsourcing to save anywhere from 10-30% on functional IT areas. Even though cost alone should never be the driver for outsourcing, there is no arguing that it makes for a good business case.
In summary – recession should not be considered a driver for outsourcing, but all other factors being the same, a tough economic environment is a good time to go shopping for IT or Business Process Outsourcing services.
To learn more about the Do’s and Don’ts of Large Scale IT Outsourcing please review our white papers.
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HEALTHCARE: THE STIMULUS PACKAGE AND ELECTRONIC HEALTH RECORDS
 Better known by its street names, Stimulus Bill or Stimulus Package, the American Recovery and Reinvestment Act of 2009 (ARRA) was enacted in February 2009 by the Obama Administration to spur the U.S. economy. The $787 billion bill aims to reinvest in infrastructure and create jobs. Of particular interest to the healthcare industry is $19 billion for Health Information Technology – $2 billion to help hospitals and physicians with up-front costs and $17 billion for incentives through Medicare and Medicaid.
According to the bill, healthcare providers are required to demonstrate “meaningful use” of “certified Electronic Health Records (EHR) technology” in order to qualify for the incentives. Ask any 10 healthcare executives what “meaningful use of EHR” means, and you might get 12 different views. The initial set of standards for implementation specifications and certification criteria (“meaningful use”) will be published by the end of the year by the United States Department of Health and Human Services (HHS). This will determine the standards healthcare providers will have to meet. Healthcare organizations that have not started EHR adoption (and there are many) are in a holding pattern until these standards are clearly defined. However, waiting could be risky and could result in rushed implementation or missing the dateline completely and thus forgo incentives next year – scheduled to start in October 2010.
There are some preparatory measures that can be tackled in the interim. These measures can mitigate risk by improving the organization’s state of readiness for EHR adoption.
- Develop the case for change now. Physician and nurse adoption is crucial to the success of an EHR implementation. The effects of an EHR implementation will reach every facet of an organization. Developing a vision and addressing the impact to the organization’s culture is critical.
- Document current processes for gap analysis. Process redesign is a key component of an EHR implementation. Documenting the as-is process will aid in identifying gaps later.
- Develop patient-care quality metrics and cost-efficiency metrics. These are, after all, the ultimate goals of healthcare reform. Quality and cost are sure to be measured by the government in any incentive program.
- Reaffirm the IT organization’s strategy. Chances are good that the organization’s overall plan already includes quality care and cost effectiveness. If so, now is a good time to ensure that the IT strategy is aligned.
- Vendor selection should be proactive. Starting the vetting process now can expedite the project kickoff later. Putting off the vendor selection process could cost an organization up to two months.
An organization that has yet to start an EHR initiative is awaiting further direction from HHS and is anxious about limited resources or a tight timeframe can engage in a number of preparatory tasks to increase the state of readiness and reduce project risks.
To learn how Enaxis can help you, please drop us an email at info@EnaxisConsulting.com.
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LEED CERTIFICATION FOR YOUR OFFICE BUILDING ASSETS – WHAT DOES IT MEAN TO YOU?
 Climate change and sustainability are at the top of many corporate agendas. Apart from media attention and political discourse, how can you profit and seize an economic advantage? The answer is simple: businesses must react and get ready for achieving higher performance in a low-carbon future. In the area of real estate and buildings, LEED certification is the industry standard for measuring building sustainability and operational efficiency.
LEED (Leadership in Energy and Environmental Design) was developed by the U.S. Green Building Council. This Washington D.C.-based, nonprofit coalition of building industry leaders promotes design and construction practices that increase profitability while reducing the negative environmental impacts of buildings. Improving occupant health and well-being is also a chief consideration.
The LEED rating system offers four certification levels -- Certified, Silver, Gold, and Platinum -- that correspond to the number of credits accrued across five categories of LEED standards. The rating system covers new commercial construction and major renovation projects, interiors projects, and building operations and facilities management. The U.S. Green Building Council LEED website introduces the intent and provides tools for asset owners and building occupants during the certification process.
Inherent in the LEED certification process is the rigorous third-party commissioning. This offers proof that you have achieved efficiency targets and your building or workspace is performing as designed. What does that mean for you? A reduction in energy costs is a reduction in operational costs. In addition, you can help boost your organization’s profile by taking advantage of the federal, state, and local incentives. All of this adds up to less expenditures and the reputational benefits associated with improved corporate citizenship.
To learn how Enaxis can help you, please drop us an email at info@EnaxisConsulting.com.Back to index |
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STRATEGIC PLANNING WORKSHOP – WORTH THE TIME!
 With a slow and unstable economy, many companies find their strategic plans, developed in more positive times, to be unrealistic and of little use. There have been budget cuts, delays in development, and staff layoffs. Employees are left thinking, “Where do we go from here?” This uncertainty has a direct negative effect on productivity.
It is a great time for executives to take advantage of the slower business pace and hold a Strategic Planning Workshop to modify plans, expectations, and priorities that reflect the current conditions. A workshop provides an opportunity for executives to meet, share information and ideas, and reassess the path ahead – to reassess, realign, and re-energize the company.
Conducting any meeting with executives is difficult – the logistics of synchronizing schedules is a challenge in itself. Any workshop must have a purpose and product currently relevant and worth the time spent away from daily responsibilities. In itself, there is significant value in the opportunity to focus on current concerns, priorities, and alignment with no interruptions. Savings may be gained in reviewing organizational structure, resource allocation, current contracts, and vendor relationships, as well as facility upgrades/repairs. Additionally, executives will feel more confident having shared their ideas and opinions, strengthened relationships, and increased involvement in the decision-making process.
The investment of a few days for planning, education, or decision-making can have a direct positive impact on the bottom line. Additionally, employees will be more productive knowing leaders are working in unison to find better ways to lead the company. As an added benefit, leaders walk away refreshed and clear about the direction forward.
To learn how Enaxis can help you, please drop us an email at info@EnaxisConsulting.com.Back to index |
ABOUT ENAXIS CONSULTING
About Enaxis Consulting Enaxis Consulting is the premier provider of management consulting and technology advisory services to Fortune 500 clients across various industries. Enaxis Consulting’s primary client offerings include management consulting, outsourcing advisory services, and business technology consulting. Enaxis Consulting drives successful outcomes using a simplified, structured methodology coupled with proven rigor and depth of experience. | |
© 2009 Enaxis Consulting |
For additional information on topics covered in this issue please email info@enaxisconsulting.com.
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