Leveraging the Global Insourcing Center Model to Win in the Digital Economy
Editor’s note: This is an interview published by HMG Strategy, the world’s leading digital platform for connecting technology executives to reimagine the enterprise and reshape the business world.
Companies of all types were forced to accelerate their digital strategies when the world changed in March. But despite the rapid transformation, many organizations have gone through, many CIOs and technology executives find themselves continuing to lack the proper skills needed to take their digital strategies to the next level.
According to the McKinsey Global Institute, demand for technological skills will rise 55 percent by 2030 as digital skills continue to become increasingly important in a changing global economy. Meanwhile, demand for digital skills is becoming even more acute as the remote work environment has demonstrated to CIOs and technology executives that members of their team can work from anywhere.
HMG Strategy: What’s new with SMC Squared?
SMC Squared CEO Dr. Patricia Connolly: We’ve seen tremendous growth over the last 7 months as the need for companies looking to onboard IT talent continues to rise. With over 30+years of corporate IT experience, my colleagues and I have first-hand experience with the challenges of working with offshore providers leading us to develop our innovative global insource center (GIC) model. As the need for IT talent grows technology executives are understanding more and more how our unique GIC model works to best fit their team’s needs.
What are you hearing from your clients?
PC: More now than ever cost-effectiveness is important but there are a lot of cost concerns in running IT teams. Talent makes up 60 percent of most company’s IT budgets. And, there is a need to pivot and innovate digital strategy in order to accelerate growth and stay ahead of the competition.
Some companies are very mature in this space. Others are just beginning. We see both scenarios, with leaders looking for our support. We also hear a lot about trust. Trust may seem simple but it is mission-critical, especially in uncertain economic times. Trust is a very important part of our partnerships as we work with clients to drive results. Simply put, we’re seeing customers move away from relationships with their vendors, on or offshore, where trust just wasn’t there.
How is SMC Squared differentiated in the market?
PC: We recruit to fit, building dedicated teams to become a part of your in-house team. We don’t believe the bench model works in the best interest of US companies. We work closely with our clients to make sure that we’re attracting quality talent in a calculated and calibrated way.
We also use our experience and best practices to teach and guide our clients’ engineering organizations for quality and success. Our GIC PMO guides this. It helps us to build cost-optimized GIC centers, along with the technical best practices that go into building digital products and analytical services.
During COVID, we have had an opportunity to show our best heart and values. Doing the right thing is important to me. We’ve helped companies with flexible payment terms and offered ideas on how to improve operations. We’re pleased to participate in really innovative partnerships that help businesses to thrive and grow. Together we are stronger.
Can you share a story with us about how you’ve helped a client?
PC: Sure, I’m humbled to offer two stories that are meaningful to me personally. We currently work with Corsicana Mattress Company, the third-largest manufacturer of mattresses in the U.S to enhance their digital strategy. With their former CIO, Rusty Kennington– a member of the HMG community–we assessed business needs, drove initiatives important to the ongoing operations, and pulled back pricing to help them manage during these uncertain times. It’s about being a good neighbor–nothing more. I’m happy we could work with Corsicana and Rusty Kennington, through the thick of it all. And congrats to Corsicana for their ongoing success.
Rusty later moved to another company in the construction products industry. As Henry Company’s CIO he has decided to partner with us again. We’re grateful for the opportunity and pleased to now serve two great companies.
As another example, innovation is taking the lead with another company, this one in the telecom space. Well established with leadership ready to drive new ideas, they asked us to build a team specific to them and their needs. We’re working on a strategy now to help them shift their contractor strategy to a GIC model. The building blocks of how we do this are part of our formula for success. We’re helping them draw a 3-year plan to ensure dedicated talent with a GIC team is ready, using a LEAD approach. The strategic pivot is hard to envision, but our experience de-risks the situation and is helping this telecom giant make a strategic pivot.
Why is GIC such a unique and innovative model?
PC: First, a Global Insourcing Center is the matured version of what we used to call a captive. Still, it’s an alternative that a lot of people haven’t heard of, or didn’t believe would be accessible to their organization.
We’re helping people understand that global insourcing is an attainable pivot for any size org, in any industry. We typically build GICs as a BOT, done in a unique way to derisk concerns for US companies. But recently, in this COVID environment, we’ve been asked to build and manage GICs as a managed service. For companies that have no interest in owning an entity offshore, this a real and viable alternative. As I say, we use the same push-ups and sit-ups, same best practices, and results. We just run the GIC on your behalf.
We are serving Fortune 500 companies, some of our nation’s largest privately-owned companies as well as many mid-sized organizations. The GIC model is highly flexible by design.
What are some of the red flags associated with offshore outsourcing models now that you’re hearing about from clients and potential clients?
PC: Retention and mindshare risk are red flags, as are huge variability with quality and productivity. CIOs seem to be really looking for alternatives they can trust.
For us, people first is an important part of our DNA. We have a 90% employee retention rate. Because our team is very engaged and committed as salaried employees, we drive real ownership in our contributions and work. It’s exciting to see a happy workforce and the positive effects on client delivery and satisfaction.
How are you leading differently with your team in these difficult times?
PC: Caring and connecting with people is very important at this time. I take time to meet with our teams weekly to see how they’re doing, inquire about their families and health. Our company recently added additional mental health and fitness benefits for all team members to ensure they continue to care for themselves and their families
SMC Squared has experienced unprecedented growth during a time when most IT services companies are struggling. Valuing people and delivering on technical outcomes and innovation continues to differentiate SMC Squared from traditional outsourcing solutions.
Now more than ever is the time to innovate, including how we build and operate our teams. Learn more about how you can take your company’s digital strategies to the next level.
Director, Business Development
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