Outsourcing Lessons as Learned and Applied by Agilent

Outsourcing Lessons as Learned and Applied by Agilent

Anita ManwaniVP & GM Global SourcingJan 20, 2004

Anita Manwani/IP Society Jan 2004

To revolutionize the way people live and work through technology

• AGENDA: Agilent’s Experience and Evolution with O-Sourcing– How we got to India recently– Barriers – Strategies

Communications

Agilent’s Focus and Purpose

Life Sciences and Chemical Analysis

Electronics


Right Sourcing Barriers & Opportunities

• Distance• Perceived Infrastructure

Availability • IP Protection• Political Stability• Control • Requires significant

investment in transitions• Lack of local management

talent • ……..

Time

Low

High

The O-Shoring Maturity Curve


Software - The India AdvantageIndia is emerging as the preferred global destination for offshore software development and remote business processing due to a number of significant advantages, primarily availability of quality skills at lower costs

Low High

High

India

Ireland

China Mexico

Size indicates the quantity of the knowledge workers

Location AttractivenessInfrastructure

– Communications– Other basic

infrastructureCountry risks / FDI incentives

– Political environment– Attractive Incentives

Time Zone Attractiveness

People StrengthQualification/ CapabilitiesCost DifferentialEnglish languageType of skillsWork Ethics

PhiliPines

S’poreHolland

Mature western Judicial system

IP Protection Laws

Favorable labor laws

Capitalist work ethic

Highly qualified and mobile english speaking professionals

Mature management talent

Breadth and scalability of services

Source: Accenture


Parts ListLow vol./HighVariance Print

Maintenance Legacy AppsOracle ERP MaintenanceIT Online Support/Help DeskRemote Data CentersApplication IntegrationWeb Content Management

Vendor PaymentsAccounts ReceivablesFixed AssetsCash Acct, SBACollections

CSGLSCAEPSGATGSPG

Print/Data Entry

IT Support

Accounting

SupportCall Centers

Professional SvcsTraining

Agilent’s Right Sourcing Strategy in India

Agilent Technologies International Pvt. Ltd.

Wholly owned entityControlled CostsInfrastructure for expansionNov 1 2001 - Operation

OSS Solutions Svs integEPSG - GSM services

Hardware RefurbishmentsEngineering SupportFinancial ServicesField Support

Resource from strategic partners and permanent employees in India

Hybrid Sourcing Model

Owned Outsourcing

Opportunitie

s

Build it and they”ll come

Rely on local talent and develop local senior managers

EngineeringDesignsS/W Dev.

R&D Centers


As we looked for hubs for our financial services….

Objective: Evaluate merits of alternative sites for Agilent’s global financial hub and recommend optimal geographic location

• Ireland • Japan

CHINA INDIA MALAYSIA

• Belgium

• India • Germany• China

• Singapore• US • Malays

ia

• Spain• UK

Political/ Macroeconomic Environment

Economic Impact

Legal Climate

HR/Labor

CriteriaConsidere

d


TRIPS (Trade-Related Aspects of Intellectual Property Rights)

• India is a signatory to the TRIPS Agreement – complies with most of the provisions.

• TRIPS Agreement deals with: -

– Copyright and related rights

– Patents

– Trademarks

– Geographical Indications

– Industrial Designs

• India led the developing countries’perspective during negotiations under the WTO round


India’s Legal Framework

Patents:The Patents Act 1970 as amended in March, 1999;

Patents Amendment Act 2002

Design: Design Act 1911

Trademarks:Trademarks Act 1991 effective 9-15-2003

Copyright:The Copyright Act, 1957 amended in 1983,1984, 1992,1994 and 1999

Geographical Indications:The Geographical Indication of Goods (Registration and Protection) Act 1999.

Trade Secrets:subject matter of contract


Industrial Designs…• Generally, industrial design protection is limited to the

country in which protection is granted.

• Under the Hague Agreement Concerning the International

Deposit of Industrial Designs, a WIPO-administered treaty, a

procedure for an international registration is offered.

– An applicant can file a single international deposit

either with WIPO or the national office of a country

which is party to the treaty. The design will then be

protected in as many member countries of the treaty

as the applicant wishes.


Trade Secrets…

• Confidential business information which provides an

enterprise a competitive edge may be considered a trade

secret.

• Include sales methods, distribution methods, consumer

profiles, advertising strategies, lists of suppliers and

clients, and manufacturing processes.


Trade Secrets…• Some conditions for the information to be considered a

trade secret (these conditions vary from country to country, some general standards exist which are referred to in Art. 39 of the TRIPS Agreement):

– The information must be secret (i.e. it is not generally known among, or readily accessible to, circles that normally deal with the kind of information in question).

– It must have commercial value.

– It must have been subject to reasonable steps by the rightful holder of the information to keep it secret (e.g., through confidentiality agreements).


Parts ListLow vol./HighVariance Print

Maintenance Legacy AppsOracle ERP MaintenanceIT Online Support/Help DeskRemote Data CentersApplication IntegrationWeb Content Management

Vendor PaymentsAccounts ReceivablesFixed AssetsCash Acct, SBACollections

CSGLSCAEPSGATGSPG

Print/Data Entry

IT Support

Accounting

SupportCall Centers

Professional SvcsTraining

Agilent’s Right Sourcing Strategy in IndiaAgilent Technologies International Pvt. Ltd.

>800 professionals Capacity extended to 1500

OSS Solutions Svs integEPSG - GSM services

Hardware RefurbishmentsEngineering SupportFinancial ServicesField Support

Resource from strategic partners and permanent employees in India

Hybrid Sourcing Model

Partners work at our sites

Explicit IP ownership & SLA management clauses

Owned OutsourcingIncreasing BPO R&D

EngineeringDesignsS/W Dev.

R&D Centers

Global Trade & Logistics Hub

R&D for Communication Solns

RF Instruments


Product and solutions development at ATI

Agilent Engineering Services providing direct material support.

High Frequency circuit design tools development

Development and support for Agilent VEE

Wireline and wireless OSS Solutions development

GUI and other software components for Logic Analyzers, High Frequency Oscilloscopes and Precision measurement systems.

User interface and data analysis tools for the SOC tester

Standards based IP development and ASIC design.

Driver development and support.

Interoperability testing. Standards based IP development and ASIC design.

Driver development and support.

Interoperability testing.


How we protect our information

• Redundant Networks/Telecom infrastructure – Fully integrated into, and providing full access to,

Agilent data & voice network, sytems and applications– Sophisticated monitoring for IP protection

• Contracts specifically targeted to retain IP ownership• No IP violations to date (too early…)• Annual web renewal of employee/manager Standards of

Business Conduct• R&D is owned outsourcing model • Third party outsourcing primarily at our own facilities


Happy Employees – loyal employees!Employee engagement program called ‘Let’s Tango!’

‘Special Friends’ Program

‘Brain Dancing’ Lets Learn Together

HR Buddies

‘Special Friends’ Program

Harvard ManageMentor®

Outsourcing Lessons as Learned and Applied by Agilent

Business

special friends

parts listlow

hybrid sourcing

industrial

sourcing strategy

trips agreement

strategic

printdata