Verigy Ltd.: A New Outsourcing
Model for a New Company
In 2006, Verigy Ltd. was spun off from Agilent
Technologies and quickly completed an IPO. As a newly
independent organization, Verigy needed to move off
of its former parent company’s IT systems and begin
operating its own Oracle applications.
The Cupertino, California-based company had decided early on that it wanted to work with an outsourcing partner to manage its applications in order to control
costs and support the company’s strong focus on its
core semiconductor test business. Conventional wisdom
said that the company should look for a large outsourcing vendor who would shift the bulk of the applications
management work to a low-cost country overseas. But
experience had shown Verigy CIO Todd Hauschildt that
such approaches often relied on several layers of management and large numbers of inexperienced employees—which can translate into long learning curves
and delays that can offset the initial cost advantages of
Staying Onshore—and Saving Money
Verigy wanted to find a better way, and so worked with
Centroid, a Detroit-based outsourcing and consulting firm, to pursue a different application outsourcing
model. Centroid’s approach relies largely on a relatively
small, highly experienced onshore staff when working
with US companies, with only limited use of offshore
workers for very targeted portions of projects—a structure that makes it easier to stay in touch with the client
company’s needs. The result, typically, is the ability to
provide quality services at the same cost—or usually,
less cost—than offshore providers.
With Centroid‘s managing its Oracle systems, Verigy
n Shorter time to value. Verigy was able to reduce
implementation time and transition systems from its
systems integrator to Centroid a month and a half
ahead of schedule. .
n High service levels. Service levels have been
consistently met or exceeded, and availability for critical
systems has been in the 99.99% range.
n Lower costs. Centroid’s approach has proven to be
more than 10% cheaper than the traditional offshoring-based models.
n Rapid responses. With minimal layers of management, Verigy has easy access to the right skilled people
and decision makers at its outsourcing partner.
With a skilled partner, Verigy is also in position to
pursue ongoing IT improvements to keep its applications in step with evolving business needs. “We’re
always working together to figure out how to do things
better than we do them today,” says Hauschildt, “and
the strong relationship we have with Centroid makes
this continuing evolution easier.”
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