Business Transformation, Proven Success Factors

Does your outsourcing service provider really have your best interests at heart?

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Evolution and Governance of the Relationship

All of TransUnion’s initial assumptions about the relationship were consistently reinforced, deepening the parties’ trust in each other. Three years into the agreement, TransUnion extended the 10-year contract for another three years.  

All outsourcing relationships encounter challenges as business issues change for one or both parties over the years of the agreement. When interests remain aligned, the parties work through the issues. Between Acxiom and TransUnion, an important enabler in this process is the fact that both companies’ key executives who were involved in structuring the relationship in 1992 are still with their companies. Thus, in scenarios where interests differ or where the contract is not clear, the people making decisions today are the ones who remember the original commitments and why they made them.

The 1992 contract included assumptions made on the cost and direction of technology for the next 10 years. The rapid pace of technology development has caused them to revisit those assumptions several times over the life of the contract and restructure those contractual clauses with more flexibility. Because both parties want to make sure their alliance lasts a long time, both made the effort to not be rigid about prior assumptions, instead, keeping in mind the long-term benefits of working together.

Maturing with the relationship itself, their attitude toward service-level agreements also evolved. The original SLA performance was watched closely; but in an attitude of partnership, there were no penalties built into the contract. What was once a three-foot-high stack of paper of SLAs has been reduced to a one-inch-thick document focused primarily on online availability. The parties credit the maturity of the relationship with enabling them to spend less time measuring SLAs, since now they each know the other is truly focused on what counts. The original SLAs also mandated fully integrated operational teams and no finger-pointing. As they worked together over time, the teams’ confidence in the benefits of a no-blame environment enabled more effective joint performance. 

TransUnion now looks to Acxiom as a trusted partner that knows the TransUnion business inside and out. As such, it looks to Acxiom not just to design infrastructure to accomplish objectives but, also, to validate TransUnion’s investment in opportunities and validate its assumptions on what it will take to deliver the promise of those opportunities.

TransUnion’s Evolving Business Transformation 

As shown in Figures 1-3, TransUnion’s processing has grown 20 times since the early years of the outsourcing agreement; at the same time, system availability increased to a near-perfect level.

Figure 1:

System

Availability

Percentage

Figure 2:

Transactions

(in millions)

Year Over

Year Change

Figure 3:

CPU Hours

Usage

(in thousands)

Year Over

Year Change

Acxiom’s early work also included applying its technology to TransUnion’s marketing services database. This enabled the gathering of disparate data, thus providing a holistic and more accurate look at an individual’s credit data, resulting in doubling TransUnion’s market share in two years.

Today, TransUnion is focused on bringing new energy and new solutions to bear in a market that has changed drastically. Globalization, huge new competitors, stringent new government regulations and dynamic customer expectations around sophisticated technologies now influence the direction of the company’s transformational objectives.

TransUnion is transforming from a data provider to a solutions partner, while concurrently phasing out legacy infrastructure and phasing in three new infrastructures. At the same time, it is dealing with enormous ramifications from government privacy and security regulations, as well as having to compete with multi-billion real estate settlement companies entering the credit bureau marketplace. Even so, new solutions must also achieve increased efficiencies, speed to market and cost controls.

Considering each other as trusted partners, they make it a point to keep each other abreast of what each is doing internally. As a result, TransUnion is now one of the first companies leveraging Acxiom’s R&D investments in developing its proprietary grid technology. As a result, TransUnion can store more data, update it quickly and do analytics faster and more cost-effectively.

Together, they also strategically collaborate on developing innovative technology solutions (such as a Fraud Management Platform) to solve TransUnion’s customers’ problems. TransUnion looks to Acxiom to speed the rate of business transformation yet to push back on overly ambitious timeframes in order to ensure product development and delivery capabilities are in step

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