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LDV Integrates Its Systems with Gedas to Improve Performance

34 Comments · Business outsourcing

LDV started out as a division of British Leyland. When the U.K. manufacturing giant closed its doors, many industry observers believed that LDV, which builds commercial vehicles, would soon follow suit.

But LDV was saved by a management buyout and today employs more than 1,000 people at its Birmingham factory.

LDV has extensive expertise in the automotive market, but its niche also presents management with significant challenges.

“We specialize in custom-designed vehicles, and rely heavily on our supply chain applications, which run on IBM mainframes,” stated Chris Linfoot, LDV’s IT director.

“The problem is that those mainframes were designed to be used by Leyland, which had a far larger IT staff than we can afford.”

For five years LDV had outsourced the maintenance of its mainframes to IBM, but Linfoot felt the company was not getting enough benefits from the arrangement.

When the contract ended, Linfoot switched the outsourcing deal to Gedas, the information services arm of Volkswagen.

The outsourcing contract has allowed LDV to focus on what it does best-manufacturing vans and other commercial vehicles-while still benefiting from the mainframe applications.

LDV has already benefited from Gedas’s expertise in automobile manufacturing. For example, Gedas has helped develop new processes that will eliminate the need for batch processing and enable the factory to operate 24 hours a day.

“The result is that we are now on the verge of a major growth spurt which will see volume quadruple,” says Linfoot.

“Outsourcing one part of our business to a company which understands it so much better than a traditional service provider is a key part of that process.”

Sources: Adapted from Sally Whittle, “Who Can You Trust to Take Care of Business?” Computer Weekly (October 21, 2003), pp. 48-49.

An additional consideration in the knowledge infrastructure of a BPO project is cross-enterprise knowledge management.

In many cases, BPO buyers share mission-critical information with their BPO vendor-information that is not only important for organizational processes but that also may be of high interest to competitors.

The criticality of this information creates two worries: maintaining information integrity and maintaining information security.

Maintaining information integrity means that the information shared between buyer and vendor organizations does not get corrupted on reconfigured.

Data corruption would result in inappropriate conclusions and errant actions as a result of analysis of altered-and possibly false-data.

Data reconfiguration refers to the potential that raw data has been altered in some way that makes it unreadable and simply unable to be converted into usable knowledge. Altered display screens are an example of data reconfiguration.

Often, a BPO vendor uses proprietary data displays for internal use. These displays, if published to the BPO buyer as replacements for familiar screens, may render the data useless to the end user although the integrity of the data interface been carefully maintained.

Displaying data in a new and unfamiliar user interface can befuddle-or at least frustrate-even the most adaptable users.

When entering into an outsourcing partnership, the two organizations, in effect, become one. In order for the outsourcing project to produce results that meet and exceed expectations, there must be transparency between both entities.

Nevertheless, when two computer systems situated in separate locations begin interfacing, security becomes a major issue.

BPO buyers must ensure that the vendor will adhere to the buyer’s security policies and that all work done adheres to up-to-date security procedures.

In many cases, BPO buyer and vendor communicate with one another via the Internet. When entering into a new BPO relationship, both organizations should review their Internet security policies.

When developing an Internet security policy, BPO buyers should keep the following points in mind:

Security Issues for the BPO Vendor
• What is its security policy?
• What are its data backup and disaster-recovery procedures?
• How is its data safeguarded from that of other customers?
• How is its data safeguarded from the vendor’s own employees?
• How is it insured with regard to security breaches?

? Limit access. Many security breaches come from within an organization; thus, the fewer people with access to the inner workings of the system, the better.

? Establish granting privileges. A rigorous procedure should be in place for granting and revoking rights of access, and granting privileges should be recorded and made available to both client and BPO partner.

? Streamline hardware and software between the two organizations because a complex system is more open to attack.

? Develop a password policy, and do not allow users to choose simple or obvious passwords.

? Have procedures for data backup and disaster recovery in place before going live.

? Have procedures for responding to security breaches in place, and determine actions to be taken.

? Have your security policy audited by an external professional organization, and have them on call in case a major breach occurs.

Although system backups may seem like a common task for the average: IT department, the backup process becomes very important when executing a BPO project.

There are going to be times during the process redesign phase when both groups will overlook an important procedure, data interface issue, or technology support opportunity.

There are so many factors to be managed during a BPO project that there will be times when the backup system is critical. The three most important factors involved in backup systems are as follows:

1. Scheduling backups
2. Tape rotation
3. Tape restoration

When conducting a tape backup, the administrator must determine type of backup he or she is going to conduct:

? Full. Copies all files in a selected volume and/or directories, clearing the archive bit for each file.

? Differential. Copies all files changed since the last backup and does not clear the archive bits.

? Incremental. Copies all files changed or added since the last full or incremental backup, clearing the archive bit for each.

The BPO project managers should mix and match backup methods on successive days. Differential and incremental sessions have the advantage of speed because they do not work on all files and may be suitable on a daily basis.

But the most complete method is a full backup that may be run weekly or on a bi-weekly basis. It is also possible that the BPO buyer already has an adequate tape rotation strategy.

The daily tapes are used over a two-week period. For instance, on Monday the seventh day of the month, the Monday-Odd tape is used. On Monday the 14th day of the month, the Monday-Even tape is used.

On the first Friday of the month, the Friday-First tape is used; on the second Friday of the month, the Friday-Second tape is used, and so on.

The two parties should select a regular date on which to conduct the monthly backup (e.g., the 15th of each month).

If the system includes an accounting, order entry, on some other type of application that executes a month-end close, the partners may want to select either the day before or the day after that close occurs to conduct the backup. The parties may also want to keep a few blank tapes around for emergency occasions.

Tape restoration goes hand in hand with tape backups. However, many companies do not have policies for tape restoration. Before developing a tape restoration procedure, the PMT should ask a few basic questions:

? What should be hacked up each day?
? How many tapes should be used?
? Is just doing a backup enough?
? Where should the tapes be stored?

Tape Restoration Guidelines
• Before starting the BPO project, test all tape backup options. Run large backups and try restoring random files.
• Rotate backup media.
• Do not exceed the tape life. Check how many times the manufacturer suggests reuse.
• Purchase high-quality backup rapes.
• Check backup logs daily.
• Always conduct a verification pass when data is backed up.

These important questions provide a starting point for managing data restoration. Even if the BPO project never needs to restore a single byte of data, it is better to be prepared.

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