1. Sourcing Evaluation Life Cycle Go/No Go decision points Competition Alignment Discovery Con tract Modification Project Initiation Vendor Capabilities Contract Management Proposal Evaluation Requirements Definition Final Offers & Contract Negotiation 1. Planning and Analysis 2. Outsourcing Vendor Selection 3. Outsourcing Agreement Assessment Baseline Determination RFP Development RFP Response Management Sourci ng Strategy

2. Step 1 - Project Initiation Tasks Introduce team and roles Review project objectives and scope, including steering committee Review project schedule Determine support resources and facilities, including a project office Develop an issue/risk log Tools and Techniques Use a proven methodology and project plan Project Plan

3. Step 2 - Requirements Definition Tasks Review project objectives and scope Develop user and IT interview guide Conduct interviews Analyze special services requirements Analyze special service level requirements Tools and Techniques Interview guide Workshop to validate business and IT drivers uncovered from interviews User Interview Guide GartnerConsulting IT Interview Guide GartnerConsulting

4. Step 3 - Base Line Determination Tasks Model current and projected work volumes Determine current and desired services levels Compare current costs to marketplace Tools and Techniques Basecase cost models Service level templates Benchmarking to understand current state Cost/Work Volumes Service Level Model

5. Tasks Identify available outsourcing vendors Determine vendor capabilities Compare against company requirements Select five vendor candidates Step 4 - Vendor Candidates Tools and Techniques IT advisory and research Structured reference checks

6. Step 5 - IT Assessment & Sourcing Strategy Tasks Compare IT Organization, Management Processes, Costs, Architecture, to best practices Assess IT’s support of business requirements Conduct a Pro-forma findings workshop Develop a Final Report Tools and Techniques Rating tables Customer satisfaction survey Sourcing decision matrix Organization Costs IT Architecture Compliant Function Outsourced Enterprise Operations Applications Development Applications Maintenance Distributed Computing Reduce CostAdd Value Risk Low High Moderate Low Moderate High Low Moderate Potential Wide Area Data Networking Moderate HighLow Voice Communications Moderate LowHigh Moderate Low IT Services Assessment Help Desk Problem Asset Change Configuration Capacity Performance Disaster None 100% OPERATIONS Element Best Practice Compliance Reduce Cost High Low Add Value High Outsource Partner Contract Insource

7. Step 6 - RFP Development Tasks Review RFP structure Define In-Scope IT Services Incorporate Work Volumes and Service Levels from Base Case Review and revise Roles and Responsibilities Identify transfer of assets from company or current outsourcer Tools & Techniques Proven RFP templates Iterative revision process Quality control all numbers stated in RFP Union Gas Desktop Services RFP # 08-15-98 © 1998 Gartner Group, Inc. All rights reserved. Union Gas—CONFIDENTIAL Use Pursuant to Client Instructions Request for Proposal August 15, 1998

8. Step 7 - RFP Response Management Tasks Conduct vendor conference Establish point of contact for vendor RFP questions Establish internal experts for vendor questions Track and respond to vendor questions Update Issues/Risk log Develop a scoring evaluation model Tools & Techniques Establish a response process Policies during response period Workshop to revise an evaluation model template To: Vendor XYZ From: Union Gas Re: Question 1234 Date: dd/mm/yy The following is a response to your question regarding work volumes for years 3-7. Response Memo

9. Step 8 - Proposal Evaluation Tasks Assign vendor proposal sections to evaluation team experts Review proposals with a focus on risks Include a Q&A session during vendor proposal presentations Update issues/risk log and summarize for project sponsor Select two finalists based on final final ratings Tools & Techniques Weighted evaluation model that reflects the business and IT requirements and objectives Focus on the transition phase(s) for risk transfer Vendor Evaluation Model

10. Step 9 - Finalist Offer & Contract Negotiations Tasks Invite two vendor finalists for final offer and negotiations Conduct due diligence Develop “going-in” contract terms and conditions Develop statements of work schedules Develop pricing schedule Develop new internal IT management organization Tools & Techniques Negotiation strategy Pricing schedule reflecting class of service and quality of service Proven contract templates from experts Statement of Work

11. Step 10 - Contract Management Tasks Review service levels for support of business requirements, including customer satisfaction surveys Assess penalties consistently Review technical architecture and standards Tools & Techniques Service level reports with root cause analysis on recurring defects Audits

12. Step 11 - Contract Modification Tasks Benchmark pricing against market rates Compare contract terms and conditions against current best practices Recommend changes to Steering Committee Implement contract changes through a change control process stated in the contract Tools & Techniques External benchmarking studies Contract comparison against best practices Contract Pricing v Market Rates