Tradelink was incorporated in 1988 as a joint venture between key trading organizations and the government to help promote trade in the region via an electronic platform.
To provide the necessary IT and network support for the expected stream of online business transactions and processes, Tradelink has signed an eight year HK$24 million (US$3.1 million) contract with Telstra-Kaz to provide all the IT systems and required services. Telstra-Kaz is the IT services arm of the Australia-based service provider.
According to Peter Stokes, CEO of DTTN, the platform is estimated to enlist 80,000 traders and 1,500 forwarders all conducting document exchanges, supply chain transactions and electronic payments.
Wholesale deal
Under the contract Telstra-Kaz delivers fully managed outsourced IT services including:
management of all the hardware, systems and applications; day-to-day operation of DTTN's systems on a 24 x 7 basis; all technical support services such as problem diagnosis, performance management and trouble-shooting.
In addition Telstra-Kaz will assume management of DTTN's various hardware, software and network providers, plus the hosting of the data center production and backup systems; as well as hardware and applications. Database administration and application support services are also provided while the service provider has also undertaken the customer services operations too. Telstra-Kaz will play a customer interfacing role, providing technical support to customers who connect their systems into the DTTN.
"DTTN needs a platform that runs smoothly with no downtime and is 100 percent secure," said Stokes.
Since DTTN has no legacy IT infrastructure the management had a clean slate to plan its IT support from. To enable a rapid launch and have a secure and stable platform DTTN chose to partner with an IT services company that could immediately provide the sort of infrastructure and support that it needed.
The outsourcing arrangement with Telstra-Kaz helps DTTN to launch the new platform quickly and also frees DTTN's internal resources to concentrate on the company's core business and its customers, added Stokes.
Lower risk and cost
DTTN reached its decision to outsource after an evaluation of the costs of performing IT operations internally versus externally. "Secondly and crucially it was clear that because of the provider's existing infrastructure, processes and skills, a partnership would present fewer risks to the successful launch of the DTTN service than the alternative option of developing the IT operations facilities internally," said Stokes.
The vendor evaluation involved a number of service providers with the final shortlist pitching Telstra-Kaz and an unnamed multinational carrier. Ultimate Telstra-Kaz was selected as being the most attractive option overall, for reasons of service quality, cost, and risk minimization, said Stokes
"DTTN is an e-Commerce platform whose livelihood and business success absolutely depends on our IT systems. Telstra-Kaz are hands-on and very attentive to our needs and have allowed us to achieve significant savings in our IT spend," said Stokes.
Key benefits from the arrangement include allowing DTTN to focus on core competencies and business and not worry about areas where it lacks expertise. Outsourcing helps to ease headcount and costs, and ensures that someone is ultimately accountable for the management and upkeep of the IT systems.
Stokes expects substantial savings versus operating IT internally but stressed cost was not the sole deciding factor. The decision was also based on the desire to have the right team of specialists providing the level of technical support that the IT systems would require. "To hire a whole team to oversee and manage internal IT systems just didn't make sense for DTTN's business," said Stokes. Outsourcing the day-to-day IT operations allows DTTN's staff to focus on the business and servicing customers.
The DTTN system entered its pilot phase at the end of 2005, with a full production launch to follow in the first half of this year.