Swiss Re and Birlasoft (India) Ltd.
“We have had some really tough discussions. But we always find a solution because we are both interested in constructively solving the problem and reaching a mutual understanding.”
Peter Cartwright, Head Service Operation, Swiss Re
Issues are part and parcel of any outsourcing relationship, which is why communication between the two companies is crucial if each partner is to achieve its business goals. But being able to communicate, especially when the going gets tough, is easier said than done.
Fortunately for Swiss Re, the world’s second largest global reinsurance company based in Zurich, Switzerland, and Birlasoft (India) Ltd, one of its IT outsourcing providers, communication is the bedrock of their relationship. “Communication is a two-way street,” says Peter Cartwright, Head Service Operation for Swiss Re. “The relationship won’t work if one partner is good at communicating and your counterpart is not. Our ability to communicate is one of the keys to our relationship’s success.”
The reinsurance company originally inherited two outsourcing contracts with Birlasoft; the service provider was working with a company the reinsurer acquired. Cartwright was pleased with its performance, so Swiss Re invited the provider to bid on other RFPs; they won two.
Swiss Re outsources its operational SAP work and workplace delivery to Birlasoft, keeping the architecture and engineering in-house.
The business advantages of good communication
Currently Cartwright works with six different outsourcing service providers operating globally in different geographies, multi–cultural environments and diverse technologies. But he says his relationship with Birlasoft is different because its executives are proactive. “They will say to me, ‘We see a problem coming.’ Proactivity is cultural at Birlasoft,” he adds.
Whenever a problem starts brewing, the Birlasoft team will bring up the issue and then have a plan to mitigate or eliminate it. “This often happens before I know there is a problem,” he reports. And he appreciates “they don’t come to see me only when they have a commercial interest.”
No one points a finger when things go south. Cartwright says other service providers are big on accusing the other side when things go wrong. “We have had some really tough discussions. But we always find a solution because we are both interested in constructively solving the problem and reaching a mutual understanding,” he says. The Swiss Re executive finds this attitude benefits the relationship.
Birlasoft is committed to being transparent, he reports. “They don’t push an issue under the table. If there needs to be a challenge, they do so and share their perspective at an early stage. This is helpful because they are the ones who have to know the exact scenario, which may have more than one layer.”
To make this happen, the two executives have deliberately taken fear out of the equation. “We don’t want people to worry they will be punished if they share bad news. That doesn’t help anyone in the end. If a system is down, I want to know about it immediately just so we can solve the problem,” Cartwright explains.
Cartwright likes the fact that Birlasoft’s management is accessible. He says he can pick up the phone and actually reach Birlasoft’s CEO. “I can tell her, ‘I need your help.’ And then something always happens.”
East European ODC set up
“They take my input seriously,” says Cartwright. A case in point: A simple conversation led to a business opportunity for Birlasoft, which deepened this outsourcing relationship.
The original contract Swiss Re inherited called for Birlasoft to provide SAP support 20×5 at Noida, India. European data privacy rules require companies to keep certain sensitive data within the EU. Birlasoft had a presence in both the UK and Switzerland but no presence in cost-effective near shore countries that would comply with the EU laws. That created a cost challenge for the relationship.
Swiss Re, however, had a portion of its outsourcing team in Wroclaw, Poland with a different provider. Cartwright suggested to Birlasoft executives they open an office there since he had people there who knew the reinsurance account well.
Birlasoft chose to open an overseas development center in the same town but with its own team. This is a big plus for Swiss Re because Cartwright only has to make one trip to one town in Poland to visit his service providers in Eastern Europe. “They could have gone anywhere in the EU that met our qualifications. But they chose to accommodate us,” the executive explains.
Communication helped a challenging transition
During the transition to Birlasoft, the former service provider was supportive but had limitations in the art of communication—which had more than one facet to make this a successful formula. Swiss Re’s SAP basic technical environment is a business-critical and complex one due to intra-department dependencies in the insurer’s day-to-day business.
Birlasoft understood this and realized the necessity of effective communication to make a successful transition, so the provider positioned a transition manager in Zurich and under his guidance created a granular-level transition plan for effective service transition from the incumbent provider. Birlasoft kept Swiss Re informed of all its moves through transparent reporting and daily communications.
During this exercise, Birlasoft uncovered systems not documented and processes that needed next level automation planning rather than manual support. This forced the Birlasoft and Swiss Re executives to craft a cost-effective strategic plan in their steering committee sessions to work with the stagnant supplier and bring all systems up to compliance. “This required a lot of negotiation,” says Cartwright.
The two also had to deal with real-time issues such as the fact that Birlasoft employees had to work overtime to create new documentation because the former provider’s documentation was limited. Birlasoft set up workshops so both sides could share issues as they arose.
Another highlight of communication was building a strong communication model at different levels; this kept all layers of Swiss Re management well informed and in complete sync at both tactical and strategic levels. Looking back, effective communication helped Birlasoft channel its multi-geo resourcing transition and insured best throughput later on in the steady state.
The most significant benefit from this outsourcing was to achieve “zero unplanned maintenance” post transition and to take on a value-added transformation journey with an enterprise partner, according to Cartwright.
Birlasoft has been able to keep the system up-to-date and brought predictability, which has helped Swiss Re improve its time-to-market for new products and services. Birlasoft has also automated formerly manual processes and provided access to skills and expertise.
For example, as an existing and available SAP product, Solution Manager, was lying unutilized. Realizing this, Birlasoft created a good number of monitoring solutions on TREX, Database Brtools and Web Dispatcher on Solution Manager, which enhanced the automated monitoring capabilities and reduced manual time investments.
Its willingness to invest extra hours to research better solutions while still delivering critical services has been commendable as an outsourcing partner, says the Swiss Re executive. This allows them to be ready for changes that lie ahead.
Birlasoft has been able to provide valuable insights to Swiss Re’s business challenges due to its experience with other insurance customers. Its executives also value the fact that Birlasoft engineers can look at a set of facts from a different angle and come up with an unusual and elegant solution. Cartwright likes that Birlasoft employees “will talk to us about new ideas and challenge our old ideas.”
Both near shoring and offshoring have reduced Swiss Re’s IT costs by up to 20 percent in this area.
Additional keys to relationship success
Each side is committed to nurturing the partnership. “We want to create personal relationships, so we periodically take our client management team out to dinner. We get a lot of ROI here,” Cartwright says.
Cartwright adds both parties work hard to help the other partner reach its business goals. “Seldom do you find a relationship so open that Swiss Re can discuss its costing goals and the provider can come back with creative models with its feasibility challenges, risks involved and mitigation plans, if it is realistically possible,” he says.
Cartwright says the traditional reinsurance industry “is all about trust.” Good communication is the key to it!