A Small External Enterprise Development Team is Cheaper than Your Own

Time is money in the application development business. We have to get to market sooner so someone else does not gazump us, and pip us at the post. We increase the likelihood of this with every delay. Moreover, the longer your in-house team takes to get you through the swamp, the higher the project cost to you.

Of course, in theory this should not be the case. Why bring in a team from outside, and pay more to support their corporate structure? Even going for a contract micro team ought not to make financial sense, because we have to fund their mark-up and their profit taking. Our common sense tells us that this is crazy. But, hold that thought for a minute. What would you say if a small external enterprise development team was actually cheaper? To achieve that, they would have to work faster too.

The costs of an Enterprise Internal Development Team

Even if you were able to keep your own team fully occupied ? which is unlikely in the long term ? having your own digital talent pool works out expensive when you factor in the total cost. Your difficulties begin with the hiring process, especially if you do not fully understand the project topic, and have to subcontract the hiring task.

If you decide to attempt this yourself, your learning curve could push out the project completion date. Whichever way you decide to go, you are up for paying advertising, orientation training, technical upskilling, travel expenses, and salaries all of which are going to rob your time. Moreover, a wrong recruitment decision would cost three times the new employee?s annual salary, and there is no sign of that changing.

But that is not all, not all by far. If want your in-house team to keep their work files in the office, then you are going to have to buy them laptops, plus extra screens so they can keep track of what they are doing. Those laptops are going to need desks, and those employees, chairs to sit in. Plus, you are going to need expensive workspace with good security for your team?s base.

If we really wanted to lay it on, we would add software / cloud costs, telephony, internet access, and ongoing technical training to the growing pile. We did a quick scan on PayScale. The median salary of a computer programmer in Ireland is ?38,000 per year and that is just the beginning. If you need a program manager for your computer software, their salary will be almost double that at ?65,000 annually.

Advantages of R&D outsourcing

The case for a small externally sourced enterprise development team revolves around the opportunity cost ? or loss to put in bluntly ? of hiring your own specialist staff for projects. If you own a smaller business with up to 100 people, you are going to have to find work for idle digital fingers, after you roll out your in-house enterprise project. If you do not, you head down the road towards owning a dysfunctional team lacking a core, shared objective to drive them forward.

Compared to this potential extravagance, hiring a small external enterprise development team on an as-needed basis makes far more sense. Using a good service provider as a ?convenience store? drives enterprise development costs down through the floor, relative to having your own permanent team. Moreover, the major savings that arise are in your hands and free to deploy as opportunities arise. A successful business is quick and nimble, with cash flow on tap for R & D.

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2015 ESOS Guidelines Chapter 3 to 5 ? The ESOS Assessment

ESOS operates in tandem with the ISO 50001 (Energy Management) system that encourages continual improvement in the efficient use of energy. Any UK enterprise qualifying for ESOS that has current ISO 50001 certification on the compliance date by an approved body (and that covers the entire UK corporate group) may present this as evidence of having completed its ESOS assessment. It does however still require board-level certification, following which it must notify the Environment Agency accordingly.

The Alternate ESOS Route

In the absence of an ISO 50001 energy management certificate addressing comprehensive energy use, a qualifying UK enterprise must:

Measure Total Energy Consumption in either kWh or energy spend in pounds sterling, and across the entire operation including buildings, industrial processes and transport.
Identify Areas of Significant Energy Consumption that account for at least 90% of the total. The balance falls into a de minimis group that is officially too trivial to merit consideration.

Consider Available Routes to Compliance. These could include ISO 500001 part-certification, display energy certificates, green deal assessments, ESOS compliant energy audits, self-audits and independent assessments

Do an Internal Review to make sure that you have covered every area of significant consumption. This is an important strategic step to avoid the possibility of failing to comply completely.

Appoint an Approved Lead Assessor who may be internal or external to your enterprise, but must have ESOS approval. This person confirms you have met all ESOS requirements (unless you have no de minimis exceptions).

Obtain Internal Certification by one of more board-level directors. They must certify they are satisfied with the veracity of the reports. They must also confirm that the enterprise is compliant with the scheme.

Notify the Environment Agency of Compliance within the deadline using the online notification system as soon as the enterprise believes is fully compliant.

Assemble your ESOS Evidential Pack and back it up in a safe place. Remember, it is your responsibility to provide proof of the above. Unearthing evidence a year later it not something to look forward to.

The ESOS assessment process is largely self-regulatory, although there are checks and balances in place including lead assessor and board-level certifications. As you work through what may seem to be a nuisance remember the primary objectives. These are saving money and reducing carbon emissions. Contact ecoVaro if we can assist in any way.

How COBIT helps you achieve SOX Compliance

First released way back in 1996, COBIT has already been around for quite a while. One reason why it never took off was because companies were never compelled to use it ? until now. Today, many CEOs and CIOs are finding it to be a vital tool for achieving SOX compliance in IT.

Thanks to SOX, COBIT (Control Objectives for Information and related Technology) is now one of the most widely accepted source of guidance among companies who have IT integrated with their accounting/financial systems. It has also gained general acceptability with third parties and regulators. But how did this happen?

Role of control frameworks in SOX compliance

You see, the Sarbanes-Oxley Act, despite having clearly manifested the urgency of establishing effective internal controls, does not provide a road map for you to follow nor does it specify a yardstick to help you determine whether an acceptable mileage in the right direction has already been achieved.

In other words, if you were a CIO and you wanted to find guidance on what steps you had to take to achieve compliance, you wouldn’t be able to find the answers in the legislation itself.

That can be a big problem. Two of your main SOX compliance obligations as a CEO or CIO is to assume responsibility in establishing internal controls over financial reporting and to certify their effectiveness. After that, the external auditors are supposed to attest to your assertions. Obviously, there has to be a well-defined basis before you can make such assertions and auditors can attest to anything.

In the language of auditors, this ?well-defined basis? is known as a control framework. Simply put, once you certify the presence of adequate internal controls in your organisation, the external auditor will ask, ?What control framework did you use??

Knowing what control framework you employed will help external auditors determine how to proceed with their evaluations and tests. For your part, a control framework can serve as a guide to help you work towards specific objectives for achieving compliance. Both of you can use it as a common reference point before drawing any conclusions regarding your controls.

But there are many control frameworks out there. What should you use?

How SOX, COSO, and COBIT fit together

Fortunately, despite SOX?s silence regarding control frameworks, you aren’t left entirely to your own devices. You could actually take a hint from the SEC and PCAOB, two of the lead organisations responsible for implementing SOX. SEC and PCAOB point to the adoption of any widely accepted control framework.

In this regard, they both highly endorse COSO, a well-established internal control framework formulated by the Committee of Sponsoring Organisations of the Treadway Commission (COSO). Now, I must tell you, if you’re looking specifically for instructions pertaining to IT controls, you won’t find those in COSO either.

Although COSO is the most established control framework for enterprise governance and risk management you’ll ever find (and in fact, it’s what we recommend for your general accounting processes), it lacks many IT-related details. What is therefore needed for your IT processes is a framework that, in addition to being highly aligned with COSO, also provides more detailed considerations for IT.

This is where COBIT fits the bill.

How COBIT can contribute to your regulatory compliance endeavors

COBIT builds upon and adheres with COSO while providing a finer grain of detail focused on IT. You can even find a mapping between COBIT IT processes and COSO components within the COBIT document itself.

Designed with regulatory compliance in mind, COBIT lays down a clear path for developing policies and good practice for IT control, thus enabling you to bridge the gap between control requirements, technical issues, and business risks.

Some of the components you’ll find in COBIT include:

IT control objectives

These are statements defining specific desired results that, as a whole, characterise a well-managed IT process. They come in two forms for each COBIT-defined IT process: a high-level control objective and a number of detailed control objectives. These objectives will enable you to have a sense of direction by telling you exactly what you need to aim for.

Maturity models

These are used as benchmarks that give you a relative measurement stating where your level of management or control over an IT process or high-level control objective stands. It serves as a basis for setting as-is and to-be positions and enables support for gap analysis, which determines what needs to be done to achieve a chosen level. Basically, if a control objective points you to a direction, then its corresponding maturity model tells you how far in that direction you’ve gone.

RACI charts

These charts tell you who (e.g. CEO, CFO, Head of Operations, Head of IT Administration) should be Responsible, Accountable, Consulted, and Informed for each activity.

Goals and Metrics

These are sets of goals along with the corresponding metrics that allow you to measure against those goals. Goals and metrics are defined in three levels: IT goals and metrics, which define what business expects from IT; process goals and metrics, which define what the IT process should deliver to support It’s objectives; and activity goals and metrics, which measure how well the process is performing.

In addition to those, you’ll also find mappings of each process to the information criteria involved, IT resources that need to be leveraged, and the governance focus areas that are affected.

Everything is presented in a logical and manageable structure, so that you can easily draw connections between IT processes and business goals, which will in turn help you decide what appropriate governance and control is needed. Ultimately, COBIT can equip you with the right tools to maintain a cost-benefit balance as you work towards achieving SOX compliance.

Excel Spreadsheet Conversion to SQL Reports

Spreadsheets are flexible, inexpensive and easy to use. They are especially handy when it comes to beating report submission deadlines or making impromptu data computations.

Unfortunately, organisations heavy reliance on spreadsheets have made these User Developed Applications (UDA) into high-risk office tools. Simple spreadsheet errors like leaving out a negative sign or a cut-and-paste mistake have already caused million-dollar discrepancies. Also, when a fraudulent employee enters into the picture, the risks become unimaginable.
Think TransAlta’s spreadsheet cut-and-paste glitch (the company later called this a ‘simple clerical error’) which caused the energy firm a whopping $24 million loss or Fidelity’s overstatement of its earnings owing to the omission of the minus sign on the spreadsheet of a $1.3 billion net capital loss.

Denizon can convert your Excel Spreadsheets to a web based SQL Server Reporting Services (SSRS). It does not import Excel data, rather it allows the creation and deployment of reports in a more efficient manner by querying the data.

So what is the problem with Spreadsheets?

Plagued with risk issues and vulnerable to fraud
Lacking in control features especially when copied, edited and emailed between many users
A burden to regulation compliance e.g. SOX (Sarbanes-Oxley)

Moreover:

Accidental copy-paste/Omission of a negative sign/Erroneous range selection
Incorrect data input or unintentional deletion of a character, cell, range, column, or row
Possibility of the user working on the wrong version
Prone to inconsistent company-wide reporting
Often ‘defenceless’ against unauthorised access

See Top 10 Disadvantages of Spreadsheets

What makes SQL Server Reporting Services better than Spreadsheets?

Free from spreadsheet risks & equipped with built-in controls that substantially reduce risks to data
Less prone to fraud
More suitable for regulatory compliance e.g. SOX
Designed for an agile business environment

Automatic consolidation eliminates errors and wasted time caused by tedious copy-pasting of data and linking of cells
Better collaboration capabilities allows team members to bring their heads together for planning, budgeting, and reporting even while on the go
Mobility support enables users to input data or retrieve information through their wireless mobile device

Superior sharing features ensures that everyone is exactly on the same page and viewing real-time information
Dashboards provide insightful information at-a-glance through KPIs, graphs, and various metrics
Drill-downs enable users to investigate unusual figures and gain a better understanding of the details that contribute to the big picture
Easy to learn interfaces allow your organisation to cope with fast personnel turnaround or Mergers & Acquisitions

Don’t know how to shift from Spreadsheets to SQL Server Reporting Services?

We’ve got the knowledge and expertise to assist you in:

Making a smooth and cost-efficient transition from risky spreadsheets to reliable reports
Designing and implementing SOX-compliant report-generating methods and procedures
Putting exposure to high-risk reporting methods a thing of the past