CIOnet UK event - Sourcing partnerships in the real world

1. Sourcing Partnerships in the real worldCan they work & how?

2. Richard Boynett – Experienced CIO Extensive experience delivering large global business transformation projects Achieved by building strong mutually beneficial partnerships within the business and with the providers of Information Technology Leveraging the power of strong partnerships to deliver business value Experience in: Automotive manufacturing, Distribution Retail on and off line – B2B & B2C Chemicals, Consumer energy, High tech manufacturing,

3. Agenda Where have ‘we’ come from? Where do I want to be? What does it take to build a partnership? What are the advantages? Success stories. Questions and discussion Do we still need multi vendor RFP's? Would the a similar approach work internally?

4. WHERE HAVE WE COME FROM?

5. Yesterday: Where Have We Come From? Zero Sum Game: Winners and Losers We, the customer: Have poor specifications... ...with weak management little or no sponsorship... ..weaker project management ...no governance... ...creeping scopes... ...no strategy – all tactical... ..with no contingency... ...demand the lowest price... ...blame the ‘vendor’ With no understanding what it takes to build true partnerships It’s all about £££

6. Yesterday: Where Have They Come From? Zero Sum Game: Winners and Losers Vendors: Bid low...get ‘em on the changes Fixed price? Build in some contingency Bid low...get ‘em on the professional services Time & Materials? License to print money Bid low... They never know what they want Push system changes Margin on margin “Partnership” is a way to ‘milk’the customer Oversell Everybody is a competitor “A” team on the bid, “C” team on the delivery...plus a few trainees Blame the customer... sell them anything It’s all about £££

7. Where do I want the relationship to be? Mutually beneficial partnerships Lower cost of doing business More responsive to my business Understand my business at the highest level An extension of my IT organisation Jointly caring about the Quality A joint vision of the future , building my strategy together Trust and integrity

8. Mutually Beneficial Partnerships What does that look like? Energy is spent on creating a larger pie, not fighting over how big the slice is Based on mutual trust Networks of partnerships Adding value by partnering with other partners Using breakdowns to create opportunities Mutual support for new or risky projects Network of commitments No blame culture Committed results driven

9. What does it take to build a partnership? A good customer Know who are your partners and who are your suppliers (earn the right) Share your business vision and issues A process / contract for the teams Constant and consistent communication - Rate the relationship Know what will happen when one or the other gets it wrong A vision of the future Trust and integrity - It’s all about people and relationships

10. Partnership Process How to manage? Senior sponsorship from all partners Fast escalation process focused on resolution not penalties Common benchmarking processes Shared savings Regular - joint strategy sessions Willingness to act as reference sites Look for opportunities to add value Joint team development Sharing of technologies

11. What are the advantages? Credibility Your brand Punch above your weight Lower costs – Joint benchmarking Fast decision making – no apples and Oranges Lower margins now for future business, ‘for the future of the relationship’ Innovation Quality - Reference site Pre sales More responsive Build strategy with you Fast to market New products / opportunities Trust and integrity

12. What are the disadvantages? You may get it wrong Effort to maintain the internal and external relationships Have to be a good customer Based on people, trust and integrity Take the blame You can’t slip back into old ways

13. Success stories Partner day Innovation Executive credibility, my brand Workshops Lower margins for future business, for the future of the relationship Quality people Vision of the future - Build strategy with you £200k not move the business Gartner white paper More responsive – issues – approvals x2 Reference site and Pre sales Looking for a job

14. Why does it work? Rapid decision making possible because: TRUST: Not frightened to make a decision based on little or no RFP process GROWTH: Using both companies and people from past relationships to quickly grow new associations – learning and gaining benefit earlier HUMILITY: Accepting that expertise is not always in house PEOPLE: Engagement from the right people in each organisation

15. So… From Vendors to Partners? We’ve gone from: A zero-sum game with winners and losers Focused on short-term revenue And moved to: Deliberate, strategic, long term partnerships Based on open communicationand trust Aligned to mutually beneficial goals Measured by the same stick Our Partners are core members of our business… …and we are key members of their businesses

16. Questions and Discussion Do we still need large multi vendor RFP's? Would the a similar approach work internally?