Outsource repetitive tasks to robots

Humans can focus on more intelligent tasks and decision making by outsourcing the repetitive tasks to robots, said Khurram Siddiqui, Mena Leader for Advance Process Assurance and Data Analytics (APADA), Financial Accounting Advisory Services (FAAS), EY

Robots, are software tools that have emerged to simplify business process delivery. The technology behind this development is called Robotic Process Automation (RPA). These software robots offer improved business efficiency, data security and effectiveness by mimicking human actions and automating repetitive tasks across multiple business applications without altering existing infrastructure and systems. Enhanced productivity, reduced cycle time, and improved accuracy and compliance are some of the benefits of this technology.

 

“We believe RPA is the next step, with the potential to significantly reduce the requirement for employees to perform rule-based high-volume activities. Embedding RPA in leveraging automation across various processes does not replace the value brought by human beings. In fact, the combination of bots and humans makes the most efficient and effective business environment,” said Siddiqui.

EY was promoting its new Finance Data Analytics product at 10th CFO Strategies Forum Mena organised by Naseba.

The tool offers a 360 view of not only finance, but also the operational trends and developments that constitute a crucial input to strategic decision making. It produces comparative analysis and detailed evaluation using information from peer companies, budgets and prior years using EY Market Intelligence Database.

Finance functions are under significant pressure across all industries but more specifically in the financial services sector. Some of the major challenges are: to shrink costs and support decreasing margins; to improve speed, volumes and quality of information provided; and to focus on the delivery of value adding insights to the business.

RPA is evolving into a new hot topic in the finance world. Its significant potential to become a differentiator in finance functions has become evident. Most of the large players in the financial services sector are either assessing possibilities to benefit from this new solution or even proceeding with the first implementations. The RPA implementation burdens (costs and timelines) are relatively insignificant, compared to major IT platform updates. Therefore, it is likely that RPA will quickly convert from being a differentiator delivering a competitive advantage to a standard practice that needed for survival and eventually, better customer satisfaction.

In the age of digital transformation, CFOs have a mandate and, equally, an opportunity to play a pivotal role in the digital transformation of their organisations. Data analytics remains at the core of the digital transformation agenda.

Organisations prepared to embark on the digital transformation journey, recognise the tremendous potential value of the data they hold, and are working hard to exploit that value. Initiatives in better data management and analytics are beginning to take shape. However, realising and creating value from data – turning information into insight and practical action – is challenging and most companies have much more work ahead.

“It is an EY offering based on our intellectual property (IP), that has been developed over time, based on a number of both regional and global case studies. The pricing of the product is based on multiple factors, which may vary based on the client environment, frequency of service and specific client requirements. All sectors can use our tool. The product is designed for a strategic function that is crucial to all organisations and sectors,” said Siddiqui.

The game changer is CFOs embarking on the digital transformation journey in a quick manner and laying the foundation of a sustainable digital journey, on an on-going basis. The tools help CFOs focus more on the strategic goals of the organisation while tactical areas could be taken care by the FDA tool. The tool provides dashboards to CFOs, enabling them making timely decisions on key issues.

EY’s session on Finance Data Analytics (FDA) showcased the new and innovative tools, which leverage the power of data and analytical techniques to identify insights and trends, and to identify control weaknesses across the finance function and operations on 100 per cent population of finance data, which is a transformational change from sample selection techniques. This will enable unparalleled business success for clients – which typically was not possible with limited enterprise resource planning (ERP) software. – sandhya@khaleejtimes.com

Source: khaleejtimes.com-Outsource repetitive tasks to robots

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‘Boutique Collective’ – The new trend for IT outsourcing

Outsourcing no longer equals offshoring. To many it will come as a surprise that out of the £6.6 billion worth of outsourcing deals struck in 2015, 90 per cent involved services being delivered onshore in the UK – with half being awarded to new local operators.

The onshore trend is driven by UK companies taking a more strategic approach. They are doing this by increasingly looking for outsourcers that can function as business partners and a genuine extension of in-house teams. And IT services are the most popular sector for UK companies to outsource. According to industry research by CACI, it leads with a 57 per cent share, considerably larger than the second most frequently outsourced service, network infrastructure (25 per cent).

With outsourcing such a hot topic for senior IT professionals, these trends reveal what a strong opportunity local outsourcing presents, particularly for business-sensitive projects that require a larger workforce than current in-house teams provide.

Strategic outsourcing

In the past, large corporations created the perception that the UK only has large and expensive consulting firms for onshore outsourcing, while alternative options have been less obvious.

However, as the UK increasingly becomes both a customer and a provider of outsourcing services, we find ourselves in a more complex market. This will continue to open the door for local, specialist providers – also dubbed “boutique” outsourcing providers – which can offer high-level expertise to businesses and government alike. And businesses are now also tendering smaller contracts to a more diverse range of providers within the UK. So perhaps the key change in the market is outsourcing partners becoming strategic business partners rather than just being seen as a distant supplier.

For specialist outsourcing providers, however, these trends also present an administrative challenge. Businesses who need an array of different specialist services can spend hours drafting up multiple contracts, which means that time and money can be swallowed up by admin. Yet this challenge can be solved by partnering several specialist outsourcing companies under one umbrella. This concept of partnering specialist outsourcing companies has been dubbed the “boutique collective” and is one of the most exciting developments of UK outsourcing in recent years.

The boutique collective

The boutique collective has many advantages over larger outsourcing operations. To begin with, it ensures that UK companies can subcontract a whole range of functions locally to strategic partners. It also collects a broad spectrum of experts under one umbrella, resulting in lower management cost.

What we advise clients at CACI is that subcontracting services to boutique collectives can narrow down the outsourcing to a small number of strategic partners that are leaders in their field. As part of this, it is therefore essential to understand the scope of what a strategic partner can offer within their area of expertise, to avoid stretching their services to the point of reduced quality. This is because a potential issue with employing boutique companies is what has been dubbed the “boutique paradox”. This paradox can occur if a company is so happy with the boutique company or collective that it continually asks the boutiques to provide more outsourcing services. This could lead to boutique specialisms becoming more generalised and eventually result in a service that is very similar to what large outsourcing firms offer in bulk.

To avoid the boutique paradox, boutique collectives will have to be set up so that individual companies’ specialisms continue to dominate the value proposition. For strategic outsourcing partners, it will also be vital to ensure they are able to collaborate well with each other. Companies should make sure all their onshore outsourcing partners can work together in a way that resembles the ideals of the boutique collective as closely as possible – even if they are competitors.

Onshore taking the lead

A single prescriptive model for how outsourcing should be managed will never exist, but by staying ahead of the trends of Outsourcing 2.0, UK businesses will be in the optimal position to take advantage of new opportunities. Even as cost is still the primary rationale for many outsourcing decisions (51 per cent), technical expertise (19 per cent) and flexibility (16 per cent) are not too far behind, leading the way for more strategic, onshore outsourcing.

For offshoring, high transaction costs and increased quality and management overheads have turned the trend against large scale offshore operations. And in the years leading up to 2016, the race to outsource operations offshore has slowed down significantly. Being the more flexible option, meanwhile, onshoring is ready to take the lead in the world of Outsourcing 2.0.

Source: itproportal.com-‘Boutique Collective’ – The new trend for IT outsourcing

Is There any Risk Associated with Outsourcing IT?

As more IT leaders rely on outsourced application development, operational resources, and more, the importance of governing and securing privileged access has grown dramatically, especially in light of recent massive data breaches.

Protecting against the leading attack vector — compromised credentials — is an important consideration when outsourcing IT functionality. Traditional privileged identity management solutions require organizations to create and manage identities for outsourced IT providers within an internal environment, and then grant VPN access.

But this practice increases risk as the gap grows between the number of remote privileged accounts and an authoritative identity provider responsible for securing enterprise access, and as more third-party laptops establish VPN connections to internal networks. The result: An expansion of potential attack points for hackers, disgruntled insiders, and malware.

Federating identity management

But there’s another option. IT can implement privileged access solutions for third parties that minimize identity-related risks using federated authentication. Federated identity management lets outsourcing providers use their existing identification and authorization infrastructure to gain access to the enterprise network. To be effective, the enterprise and its outsourced IT provider must establish mutual trust, and the enterprise must be able to monitor and audit access and protect against rogue attacks from unauthorized parties.

With this approach, the outsourcing organization retains management control for its employee identities, while the enterprise retains control over granting access privileges to enterprise systems and applications for third-party partners.

Privileged access to specific resources can be governed through automated request and approval workflows. The enterprise can effectively monitor and audit access by providing granular access rights and by capturing and reporting on privileged user activities. In addition, IT maintains the option to terminate privileged sessions if they receive alerts of potential security violations.

Federated privileged access allows the enterprise to streamline access management for any number of outsourced IT firms while retaining the ability to swiftly disable privileged user access. In this way, IT can ensure that employees, contractors, and partners have secure access to the right resources, at the right time, and for the right reasons.

Establishing an identity provider

To implement federated privileges, outsource providers must have their own identity provider in place. An identity provider creates, maintains, and manages identity information, and uses technologies like the Security Assertion Markup Language (SAML) to authenticate its users into apps in the cloud or in an enterprise data center. For example, the Centrify Identity Service uses SAML to provide simple, cloud-based identity federation.

Outsourcing IT providers can manage their own employee authentication, directories, and identity solutions while the enterprise provides secure access to shared enterprise applications and resources.

Source: CIO.com-Is There any Risk Associated with Outsourcing IT?

Does location really matter when offshoring your IT services?

Not too long back, many global IT service providers were known to move delivery of IT services of their clients to offshore locations (like South Africa, Latin America or India) without informing their clients. This was seen as an internal lever to make customer contracts more profitable in a multi-year deal as services were first stabilised in a high-cost onshore delivery location before being shipped to an offshore location. With maturing client awareness, most contracts today include provisions requiring the service provider to state up-front the offshore play along with details of all countries from where services would be delivered. In many cases it also includes the specific cities from where the services will be delivered in the period of the contract.

As an enterprise, what do you do with this visibility? Beyond knowing that some of your services will be delivered from a particular offshore location, does it really matter? Further, can you use this to ensure you get better quality of services or even more cost efficient services when discussing with your down-selected IT service providers? Yes, yes and yes!

To understand this, we should delve deeper into what goes inside most IT service providers’ organisations when it comes to building their location strategy. From my personal experience with some of the largest global IT service providers, offshorebased IT service providers and other mid-sized providers, the location strategy is at times built with a well-crafted plan but at other times has seemingly bizarre rationale. It is important to understand that in most cases the location strategy is a downstream effect of growth of their business. Service providers operate in a highly competitive market and would ideally like to ramp up the size of their delivery locations as new business comes in which provides them revenue to fund these expansions. Unfortunately, most service providers still have a labour-intensive delivery model and clients expect services to start within weeks of signing contracts. Thus lead time (of few weeks) is too short to stand up new facilities to deliver for new contracts.

In case of very large and even mid-sized providers operating for couple of decades, the location strategy today is often seeded in the way they grew historically. In several cases, historically few locations emerged when either existing space was available at short notice, or there was a good real estate deal available – and sometimes even when it had to be the home town of the top leader under whom the delivery of a major client was dependent (typically a vice president or someone as senior)! Access to skills and tax holiday criteria are some other factors which have driven the locations that were developed historically.

In today’s times when things are better organised and that approach cannot be taken any longer, most service providers retain hard shell spaces in major cities where they operate. These places can then at short notice be converted into warm shells with interiors and other aspects of getting the space ready for delivery. Thus the longest lead time of identifying and acquiring space is taken care of. With the current space challenges at most significant offshore locations, it is also a challenge to find new space contagious with existing operations. In most cases the service providers look for spaces either in the same IT park (if not in the same building) or even in the same city to still leverage local management.

Many service providers have Centres of Excellence (for specific verticals like Insurance or Retail) in a particular offshore location. Most often these are cities where they started few major clients in that vertical historically and it helped to move across team members across accounts which resulted in these developing into hubs for a particular industry vertical. It also helped to cross-leverage best practices and management focused on a particular vertical.

So, what can a CIO and her team do with this awareness when signing their next significant outsourcing contract? Here are few imperatives which can help:

Insist all locations being used to deliver services for their contract are stated up-front. Further the service provider should be obligated contractually to inform and get a concurrence in advance before changing the locations to deliver services.

  • Ask for the names of other major clients from their industry vertical that are being serviced from that location? A good set of clients from the same vertical ensures that there will be access of skilled resources, seasoned managers and that the account is not a victim of BOCA (best option currently available) factor.
  • If feasible, insist on getting services delivered from a single offshore location (or not more than two or three locations if the contract is really big). Clients have been known to have discovered that services were being delivered from as many as six to eight offshore locations. This leads to poor quality of service due to poor control, lack of strong management and operational rigour.
  • Ask for a discussion with the local leadership team who would be responsible for the delivery of services. Understand their experience in delivering for the industry vertical. This is more relevant for consulting, application services and BPO (as against IT infrastructure services).

While there are several factors that determine successful delivery of services for a contract, given the same provider, the choice of location can have an important play. It finally comes close to the mantra in real estate which states that only three factors are important to consider when choosing a property: location, location and location!

Source: outsourcemag.com-Does location really matter when offshoring your IT services?

Robotic Process Automation Puts Outsourcing On Notice

The future of outsourcing is not what it used to be. Apologies to Yogi Berra, but it is true. CFOs now report mixed or diminishing results from outsourcing, once a guaranteed method to reduce costs. It is time to consider Robotic Process Automation (RPA). RPA is changing the outsourcing equation, inspiring some customers to insource while allowing forward-thinking BPOs to reenergize their value proposition.

Outsourcing Reconsidered

Every finance and insurance enterprise has employed outsourcing, but the laws of economics were inevitable: business process outsourcing (BPO) labor costs escalated as you and your competitors increase BPO demand. Your BPOs sought and established operations in lower cost geographies. The process repeated itself until BPOs ran out of geographies.

Furthermore, outsourcing has hidden costs. For example, there is the BPOs’ search and ramp-up costs for new geographies (costs passed on to you), worker turnover when they find better paying positions (BPOs are feeling the war for talent) and retraining costs when regulations (and the associated processes) change – this is especially endemic in the finance and insurance industries.

Outsourcing may still work for you and there is a way your BPO can enhance it.

Robotic Process Automation Revolutionizes Cost Savings

Robotic Process Automation (RPA) allows you to achieve cost reduction even when you are insourcing/reshoring. RPA also allows BPOs to achieve service levels previously unimagined.

RPA is the application of technology (software agents or ‘robots’) that automates workflows, typically repetitive, rules-based work. Think of RPA as a new class of digital labor. RPA mimics the actions a person would take while working on a computer. These can include interactions with desktop applications, enterprise applications, email, green screens, websites, portals, etc.

RPA is an ideal replacement for the traditional outsourced business processes. Think of those steps that involve manual data entry, data validation or screen scraping such as new account setup, deposit or check processing, claims processing and account management. RPA can perform these routine tasks error-free, 24/7 and a lot faster than humans can. RPA scales up with no or minimal incremental cost. The Institute for Robotic Process Automation (IRPA) estimates that a robot costs 25% – 30% of an offshored full-time employee (FTE).

RPA will not disrupt your enterprise. It complements your software applications, has a short implementation time and much lower implementation costs compared to other enterprise application projects.

RPA is a Win-Win

Outsourcing was once disruptive and most of us have realized its benefits. Today, economics and advancing technology are challenging the appeal of BPOs and forcing them to enhance services offerings. RPA is a natural, if not a mandatory addition to a BPO’s repertoire. If your BPO does not use RPA, you need to bring them to the table and let them know what is at stake.

At the same time, RPA provides you with an alternative to outsourcing. Some of the benefits you can realize with RPA include:

  • Employees are focused on higher value tasks rather than tedious steps. This helps productivity and morale.
  • You have more bandwidth to consider innovation rather than cost reduction.
  • Agile response to change. You can deploy and adjust a robot quickly and inexpensively.
  • Faster and higher volume processing enhance the customer experience.
  • Enhanced controls and compliance. Your processes are more transparent and auditable.
  • Your data, money, and jobs do not leave your country or your supervision.
  • There are no lag time issues or latencies due to BPO interactions.

Join the Robotic Revolution

RPA is the new disruptive. By now, we are all pros at witnessing disruptive technologies, understanding their power and long-term implications. We are also pros at understanding the danger of not preparing for and participating in such disruptions.

As Cliff Justice in a CIO article advises: “

This is the time to plan for RPA. Fortunately, RPA is a low-risk, high return, innovative investment for any enterprise or BPO.

Source: Robotic Process Automation Puts Outsourcing On Notice

How aligning with the organization’s strategy ensures outsourcing success

Although well thought upfront, the alignment of an organization’s strategy with their decision to outsource tends sometimes to be focused on short-term attainment of the organization’s bottom line and cost reduction targets. There are seven fundamental steps an organization may wish to follow to ensure the alignment with its strategy materializes it.

Last month I wrote about 13 game changers for successful outsourcing relationships. Today, I want to emphasize the importance for game changer No.1 – alignment with the organization’s strategy.

Although well thought upfront, the alignment of an organization’s strategy with its decision to outsource tends to be focused on short-term attainment of the organization’s bottom line and cost reduction targets.

However, there are seven steps an organization may wish to follow to ensure the alignment with its strategy materializes after the organization decides to outsource:

Step 1 – strategy is much more than brainstorming: a recent article published on the Harvard Business Review by Ken Favaro from consulting firm Strategy& (formerly Booz & Company) clearly defines three types of strategies for an organization:

• Corporate strategy – related to the organization’s capabilities, competitive advantages and business it is in.

• Business unit strategy – related to target markets, products and services provided to its clients.

• Implementation strategy – consists of all of the decision and activities an organization needs to execute in order to achieve the organization’s corporate and business units strategies.

When an organization is able to align all of the elements above, outsourcing makes more sense. As a reference, there are great books out there like the well-known and celebrated Good to Great from Jim Collins in which real examples of organizations being able to turn dreams into reality are provided.

Step 2 – are quick wins achievable? Having quick wins mapped and well executed will definitely boost the organization’s confidence throughout all of its strategic decisions and milestones. Like in any change, having reassurance of the organization’s strategic decisions materialized into outcomes will help to generate the much needed momentum and stamina required in order to promote a complex change like outsourcing. Therefore, quick wins should be a top priority within the first 90 days.

Step 3 – are lessons learned being leveraged? Throughout a complex change like outsourcing, an organization may make mistakes along the way. Instead of focusing on what went wrong, a suggestion is to turn those into effective lessons for the organization’s team – as you want to continue to generate momentum and demonstrate support throughout the entire sourcing lifecycle. Another benefit is the “bond” it generates within the organization’s team involved. If an organization is able to quickly address/resolve issues, the benefits of outsourcing tend to be visible in spite of any challenges.

Step 4 – are you tracking progress and promoting adjustments in a timely manner? Changes to an original plan might be required in order to attain the desirable outcomes. Organizations may face the challenge on what is their real progress within their strategy – and whether or not their initial timeline still holds. In case it does not, a potential reassessment of the timelines adjustments against benefits and risks might be useful to determine the net impact of any changes required. Most importantly, an organization should have a clear guideline for risk management. For example, if an organization’s business unit strategy is poorly managed and somewhat contrary to outsourcing, it will be very hard to manage/attain success.

Step 5 – are you attaining the desirable outcomes for the organization?Another consideration is to be clear about the outcomes managed to date and consider if those are representative of the organization’s strategy. Although time consuming, one should ensure that things such as the organization’s vision/values as well as costs are accounted for. Furthermore, organizations should not underestimate what it takes to make outsourcing a successful value proposition, and manage expectations within their teams and accordingly.

Step 6 – are you monitoring external factors related to your decision? In today’s global economy, organizations should be monitoring potential external factors that may impact their decision to outsource. For example, currency risks and inflation levels on developing countries where service providers have delivery centers. Although indirectly related, external factors can lead to reputational risks, which may impact to the organization’s brand and strategy. Once the outsourcing agreement is in place, the ongoing monitoring of those external factors should continue.

Step 7 – are you ready to execute? The right balance between a company’s vision and reality should be attained in order to succeed. Organizations that do not have the right approach to manage such a complex change tend to suffer the consequences of a poorly managed implementation strategy. Furthermore, it will lead to a misconception that outsourcing does not suit the organization’s corporate and business strategies. Although it is hard to be in that position, a turnaround is achievable so long as the above steps are being considered going forward.

At the end of day, you are not alone if you thought outsourcing is harder than it looks. The above steps are outsourcing enablers, as those can let you assess the outsourcing alignment with the organization’s strategy.

Source: Outsourcing.com-How aligning with the organization’s strategy ensures outsourcing success

Outsourcing in the age of cybersecurity concerns

It’s only natural that security comes up when talking about software development. There’s no denying that poor software development practices and subsequent security issues can go hand in hand. The risks can be alarming. Access to an enterprise’s database can be embedded into code. There could be unknown backdoors and other vulnerabilities, allowing hackers to access customer information like usernames, passcodes, credit cards numbers or other sensitive data. Unfortunately, we hear about this all too often in the news.

“Seemingly on a weekly or even daily basis we learn about a cyber security breach on a major corporation,” notes Udi Mokady, the founder, president and CEO of CyberArk, an IT security solutions company, in a J.P Morgan Q&A. “It used to be that unless you were a bank, credit card processor or manufacturer of military weaponry, cyber attackers wouldn’t bother to zero in on you. Now, no one is safe: everyone has something of value. Cyber attackers have broadened their targets, attacking companies of all sizes in industries such as retail, media, energy, manufacturing and IT services, among others.”

So, outsourcing software engineering must make security more risky then, right? Well, no. Developers themselves are without a doubt aware of the risks. For example, The Software Integrity Risk Report, a study conducted by Forrester Consulting and commissioned by Coverity (now a part of Synopsys), says more than 74 percent of respondents state developers are held more accountable for quality and security goals than a year ago. The study is a survey of 336 software development influencers in North America and Europe, and it explores current practices and market trends for managing software quality, security and safety.

Also, developers in the EMEA regions (Europe, the Middle East and Africa) note extreme concern with security in their development projects, based on the EMEA Development Survey by Evans Data. In fact, many developers have taken steps to safeguard projects and apply security mechanisms to combat threats. Some of the most commonly used, according to Evans Data research, are:

  • Context-aware access control
  • Endpoint threat detection
  • Real-time security analytics
  • Cloud access security control
  • And VM monitoring for threat detection

Good software development outsourcing companies should be on top of quality assurance (QA) and testing best practices, as well as overall security issues. However, before you decide to outsource to a software developer, know what measures will be taken to keep your software hacker-proof, and request that your provider define these steps (or define them together). Ask them to tell you specifically how they’ll test your software for security issues, and what controls they recommend.

The IoT and cloud computing play a factor

Another discussion to have with your software development outsourcer is the connection between the Internet of Things (IoT), Cloud computing and software outsourcing. Many software developers are already deeply and unavoidably involved with these technologies, as more and more apps move to the cloud and as the Internet of Things grows into the billions of connected devices.

Because of the risks associated with these new technologies and connectivity, security has become one of the most serious concerns for IoT software developers. Likewise, in its Internet Of Things Development survey, Evans Data found that more than 46 percent of developers surveyed, who are actively developing for IoT, cited security as the primary challenge facing development and adoption.

“Security is important in every discipline, but no more so than in the Internet of Things development arena,” says Janel Garvin, CEO of Evans Data. “Security breaches in IoT can have very real and devastating consequences, and developers feel that the Cloud is both the glue that holds Internet of Things together and also the weakest link.”

Cybersecure software development

In response to significant hacks and security breaches reported in all the major media outlets, cybersecure software development has become even more critical, and enhancing cybersecurity at an enterprise oftentimes requires hiring and/or training an internal workforce. However, is that an expense your company is ready to take on? A proven and widely used alternative is outsourcing to a certified software outsourcing company.

In effect, organizations expect to outsource even more cybersecurity work — all with risk assessment and mitigation, network monitoring and access management, and repair of compromised systems frequently involved — notes an Intel Security study, For the study, a total of 775 information technology decision-makers involved in cybersecurity within their organization, all from numerous countries were surveyed in May 2016. The respondents were from organizations with at least 500 employees and came from both public and private sectors. More than 60 percent of respondents noted they outsource at least some of their cybersecurity work, says the study, which was conducted in partnership with the Center for Strategic and International Studies.

As you plan your company’s software development roadmap, consider cybersecurity and be aware of these factors that could impact its ROI, according to the Intel Security study: acquisition and implementation costs; management efficiency; effectiveness at reducing cyberattacks; and compatibility with existing technology.

If you’re embarking on a software development journey, use the ideas presented here to have serious conversations with your outsourcing partner about the security qualifications of their developers. With the right team, your software will be developed with security top of mind.

Source: CIO.com-Outsourcing in the age of cybersecurity concerns