Agile approaches are now an undisputed prerequisite for the successful implementation of digitalization initiatives. The approaches are sufficiently known and easily explained (yet often fail in consistent application. But that is another topic). DevOps approaches significantly improve collaboration between software development and IT operations. The extended end-to-end agile collaboration between business, development, and operations is called BizDevOps. BizDevOps follows the agile approach of self-organizing teams composed of representatives from the business (Biz), development (Dev), and IT operations (Ops). With the right team in place and applied optimally, this is the success model for digitalization. In large companies, extensive transformations are required and have often already been implemented with initial successes.
Often overlooked, however, are the impacts on sourcing strategy, appropriate contract design, and collaboration with suppliers. This can severely complicate and endanger the achievement of transformation goals. In this article, based on our many years of experience with managed cloud services and SaaS models, we provide concrete practical recommendations for targeted and successful collaboration with suppliers.
You design it, you build it, you run it: BizDevOps
A few brief explanations of the BizDevOps setup and approach. The Product Owner is also the central role here. They are responsible not only for the professional development of the product, application, or services but also critically for operations. Business, development, and operations work closely and directly in a self-organized and as autonomous as possible team. Often, roles merge, and a developer with operational responsibility becomes a DevOps Engineer. This evolution of roles and competencies is important for success and, due to the variety, also more fulfilling for employees.
The individual steps of conception, analysis, implementation, deployment, and operations are executed iteratively and continuously, closely interlinked. This leads to direct feedback loops and continuous improvement.
The positive effect on the three classic business objectives is measurable and demonstrable: shorter time-to-market, optimized total cost of ownership, and higher quality.
The right sourcing strategy for BizDevOps
Very few companies have all competencies internally and need to collaborate with external suppliers in different configurations. Instead of “horizontal sourcing,” sourcing must be “vertical,” i.e., competent and suitable suppliers must be identified to cover the entire lifecycle. The criteria for supplier selection are therefore different and new. It is no longer about isolated competencies and cost leadership in a single discipline but about covering business, IT, and methodological competencies across a clearly defined professional scope.
The right contract design for BizDevOps
Contracts with suppliers must be designed more openly with room for innovation. Phased approach: Phase 1: T&M contract model for initialization (max four sprints). Phase 2: 50% cost performance-based, 50% T&M. Phase 3: 100% performance-based KPIs including cloud costs to promote efficiency and infrastructure optimization.
Measure and manage correctly – KPIs and SLAs for BizDevOps
Outcome-oriented (business value), quality-oriented (high service quality), pragmatic (fully automated collection). Important KPIs: customer satisfaction (NPS), velocity (story points), availability, mean time to repair (MTTR).
BizDevOps: client and supplier in the same boat. KPIs are used to manage the partnership and not to control a supplier. Applies to both private and public sector projects.
LionGate – Building Custom Cloud Solutions. For years we have been developing and operating commercial custom cloud solutions in a BizDevOps setup. The success of our clients confirms our approach. We look forward to exchanging ideas and helping with your challenges.
