Under the Influence of Capital Constraints

By Outsourcing Center, Kathleen Goolsby, Senior Writer

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Under the Influence of Capital Constraints

In this article, discover how HQ Global Workplaces used outsourcing to overcome capital constraints.

The office outsourcing industry (once known as the executive suite industry) provides fully furnished, staffed and supported offices to large companies or entrepreneurs with a need to quickly establish an office without the capital investment or the distractions of actually setting it up and managing it.

HQ Global Workplaces (HQ) has about 65,000 clients with nearly 480 offices in 19 countries. For each of its offices, HQ provides the technology, broadband Internet access, phone systems, switchboards, and all the staff. “Our clients just walk in and sit down and go to work,” says Mike Grimm, HQ’s chief technology officer. “They can use it on a flexible basis – for an hour, a day, a month or a year. They just call us and tell us where they need office space and when.”

HQ has been in business since 1962, but later the company underwent a rollup and now is the combination of 51 mergers and acquisitions. Grimm says the M&A activity resulted in HQ having no consistency across the portfolio of offerings to its clients. Technology such as phone systems and PCs varied from office to office.

“The customer experience needs to be very similar from business center to business center,” explains Grimm. “Consistency is extremely important. It’s necessary for operational efficiency but, more importantly, we need to deliver a consistent customer experience and brand.”

The Challenge: Capital Constraints

That was just the starting point of the challenge facing Grimm. He estimated that HQ would have to spend in excess of $5M to acquire and roll out the needed 2,800 PCs and the right level of software. But because of internal constraints, he’d been tasked with reducing his operating budget by 35 percent and reducing his staff – yet ensuring nothing would fall through the cracks in level of service or client satisfaction.

In a few weeks, he had a plan. And it was heavily tied to Everdream Corporation, a managed service provider (MSP).

The Solution

Everdream offers a series of desktop management services. Besides the 2,800 top-quality HP PCs loaded with the full suite of Microsoft software, HQ gained 24/7 help desk services. That enabled Grimm to reduce his staff by the 10-member help desk department as well as reduce his operating costs. The Dream Services Program also includes a technology refresh every three years.

But what initially attracted Grimm to Everdream was the supplier’s proprietary products. “They have self-healing technology,” he says. “Whenever an Everdream PC boots up and connects to the Internet, it makes a call onto an image that is maintained on the server at Everdream; and all the executables and the different files that make up the operating environment are compared to make sure they have not become corrupted. If there is any problem on the PC or on one of the applications, it automatically downloads the correct version and repairs itself without the user even seeing that error.”

As part of the Dream Service Program, every PC comes automatically loaded to connect through the Internet to the backup server and download any file that was changed since the last backup. “So we have a comfort level that we have the ability to restore,” explains Grimm. More importantly, in the event a PC is stolen or destroyed or just doesn’t work, Everdream can immediately make a copy of the backup and overnight it to the client.

The Everdream suite includes asset management, using wizards that automatically keep track of all the machines at the client site. It also keeps track of software license issues so clients don’t inadvertently run illegal software. As Grimm points out, users in its many offices often load their own software, and HQ doesn’t know what’s out there. So Everdream’s services eliminate an administrative nightmare.

HQ and Everdream decided to go forward in their outsourcing venture, beginning with a 30-day pilot and shipment of 200 PCs. “We did the pilot because we had to figure out what to measure and monitor and how to make our decisions,” recalls Grimm. “We had to be very aggressive because 30 days is very, very short for something like this. But we got the right kind of data and then charged forward with a full-scale deployment.”

The Icing on the Cake

They signed a three-year contract with a cancellation provision if the results of the pilot did not meet HQ’s level of satisfaction for any reason. The help desk process was put in place for all HQ offices on day one. It was a full-scale overnight deployment. That maneuver was followed with the rollout of 150 PCs per month. And all went smoothly.

A big key to their success in working together, according to Grimm, was the supplier’s “incredible cooperation and proactive approach” on understanding HQ’s business and existing resources. When a user calls the Everdream help desk with questions about voice mail systems, business systems, Web sites, and other non-PC-related matter not outsourced to Everdream, the supplier still needs to capture that call information and route the call seamlessly to HQ’s IT team.

Grimm admits he was surprised by the complexity in that strategy and the amount of effort both companies had to exert to help each other understand the best way to manage those call queues. Everdream had to do some programming on its call tracking system to define the queues and make sure the calls were being routed to HQ. “To their credit, they did whatever it took to make it work successfully, and they never came back and said they wanted more money for it,” says Grimm.

The monitoring of performance of Everdream’s help desk services tells an even better story. A prior outsourcer had achieved only a six percent rate of resolution on first call, and many calls had gone into the outsourcer’s voice mail system. Everdream’s first-call resolution rate is 42 percent, and 100 percent of the calls are answered by a live person within three phone rings. Even so, Grimm says Everdream shows continuous improvement every month. “They have exceeded our expectations by a wide margin.”

In conclusion, HQ Global Workplaces successfully navigated capital constraints through strategic outsourcing with Everdream Corporation. This approach not only reduced costs but also improved operational efficiency and customer experience.

Lessons from the Outsourcing Journal:

  • Leveraging an outsourcer’s resources is the ideal solution for a buyer needing to acquire resources despite capital constraints and for reducing staff and operating budgets.
  • A big key to success is finding a supplier that will take a proactive approach on understanding the buyer’s business and existing resources.
  • An automated asset management program can eliminate an administrative nightmare for enterprises with multiple locations.

About the Author: Ben Trowbridge is an accomplished Outsourcing Consultant with extensive experience in outsourcing and managed services. As a former EY Partner and CEO of Alsbridge, he built successful practices in Transformational Outsourcing, Managed services provider, strategic sourcing, BPO, Cybersecurity Managed Services, and IT Outsourcing. Throughout his career, Ben has advised a broad range of clients on outsourcing and global business services strategy and transactions. As the current CEO of the Outsourcing Center, he provides invaluable insights and guidance to buyers and managed services executives. Contact him at [email protected].

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