SlideShare ist ein Scribd-Unternehmen logo
1 von 45
Downloaden Sie, um offline zu lesen
© 2013 Information Services Group, Inc. All Rights Reserved.
Proprietary and Confidential. No part of this document may be reproduced in any form or by any electronic or mechanical means,
including information storage and retrieval devices or systems, without prior written permission from Information Services Group, Inc.
Creating the Innovation Platform – RFS and
Other Techniques
Dave Tienstra – Partner – Retail, CPG, Travel & Transportation, Hospitality
Clay Calhoun – Partner – Banking, Financial Services, Insurance
Paul Schmidt – Partner – Retail, CPG, Travel & Transportation, Hospitality
September 10, 2013
2013 Sourcing Industry Conference
© 2013 Information Services Group, Inc. All Rights Reserved 2
A Market View
© 2013 Information Services Group, Inc. All Rights Reserved 3
The CIO Heat Map has never been more complex. Many players in the eco-system
are opining from north, south, east and west.
Issues that are on the Desk of our Clients
Big Data
IT Consumerization
Green
Talent
Management Security
Business Unit
Alignment
Business Enabler
Vs.
Business Inhibitor
Self-Funding Models
Unified Communications
& Analytics
© 2013 Information Services Group, Inc. All Rights Reserved 4
In today’s market, change is everywhere and is accelerating exponentially…
Pace of Change
Change
Time
This suggests that if we adjust our pace of
learning, that we will remain aligned.
What if the Pace of Change is Non-Linear?
What-if?
© 2013 Information Services Group, Inc. All Rights Reserved 5
Pace of Learning < Pace of Change
In today’s market, the pace of change exceeds our pace of learning. The divide is
noticeable and increasing at an alarming rate.
Business
Alignment
Technology
& Services
Business
Practices
We are
here
Growing
Misalignment
© 2013 Information Services Group, Inc. All Rights Reserved 6
Evolution of procuring a managed service is becoming a revolution
Single supplier / multiple
functions
 Very large contracts
 Long duration (~7-10 )
 Often lift and shift –
custom requirements
 Often with asset transfer
 9 – 12 month project
RFP is best vehicle for going
to market due to custom
requirements.
Often two providers –
Infrastructure and ADM split
 Large deals
 Long duration (~5 – 7)
 Leverages best practices
 Still leveraging custom
requirements
 6 -9 month project
RFP is a good fit but now
includes some industry
standard requirements –
CMMI, ITIL
True multi-sourcing – best
provider for the Service and
SIAM
 Medium size deals
 Shorter duration (~5
years)
 More use of standard
solutions
 Usually no asset transfer
 4 – 6 month project
RFP is an adequate fit and
now includes cross-vendor
integration (SIAM)
requirements
Multi-sourcing with new
technology, commercial
models & new provider
entrants
 Small size
 Short Duration ( 3 – 5
years)
 Often includes
innovation
 3 -4 month project
RFP can be too time-
consuming and may stifle
innovation – what are the
alternatives?
2013…1990 2000 2010
PluralisticBipartisanMonolithic Dynamic
© 2013 Information Services Group, Inc. All Rights Reserved 7
Where have we been and where are we going?
In 2012 ISG suggested that the “RFP is dead” (or should be) in today’s market. In
2013 it is time to explore a framework of Evolutionary Contracting
Classic Contracting is decreasing
► RFP is too prescriptive.
► RFP limits innovation.
► RFP’s are too formal and they do not foster
trust or transparency
► Need something more flexible in the market 
RFS process.
► RFS can yield more innovative solutions for the
base contract.
► RFS with Collaborative Contracting, done well,
can foster trust and transparency.
Evolutionary Contracting is increasing
► Contracts need to evolve over time.
► Static operating models for multi-year durations
do not make sense.
► Base Contract is just the beginning of the
business relationship – it must grow/evolve or
run the risk of becoming outdated and
irrelevant.
► Buyers and Sellers need to engage in Mutual
Consent Commerce.
 True win/win with easy on easy off terms.
 Think handshake with 100 pages vs. classical 1000
page contract.
 Think dating vs. marriage
© 2013 Information Services Group, Inc. All Rights Reserved 8
ISG’s award winning innovation in sourcing process
Request for Solution
© 2013 Information Services Group, Inc. All Rights Reserved 9
IACCM 2013 Innovation Award - RFS
RFS is already short-listed – final award presented in October at
the IACCM Americas Forum 2013 in Arizona.
IACCM Innovation Awards
Recognizing outstanding leadership & innovation in commercial contracting
Award for outstanding service providers - For consultants, service or
application service providers who have led or enabled high value initiatives at
client organizations.
© 2013 Information Services Group, Inc. All Rights Reserved 10
Client Innovation Challenges
Dialogue ISG has “behind closed doors”…
© 2013 Information Services Group, Inc. All Rights Reserved 11
Clients want to source a service, but want innovation too . . .
► Describing innovation in an RFP can be very difficult or impossible
 The marketplace for services is changing rapidly – in some cases, so quickly that
service provider’s own marketing can’t keep up
 Every day there are announcements of new technologies; new and emerging
standards; and changing delivery and commercial models
► You could consider a less structured, more collaborative approach to the provider
marketplace, and ask for a solution to your problem from providers most suited to
know your business, and their best ideas, using their latest offerings!
Leverage knowledge to power results – and achieve objectives – and more.
The Request for Solution process allows you and your potential providers the best
chance to find the right answer for you, and lets the expert provider architect that
answer with the very latest technology and business process solutions.
© 2013 Information Services Group, Inc. All Rights Reserved 12
RFS allows the Provider to show their best
Less prescription, more collaboration, better result. RFS allows the Provider to show
their best approach and solution to the problem.
How do you
leverage
the best
knowledge to
power your
results?
The RFP:
The Buyer’s Solution
► Focus: getting to
“perfect” base contract
► Process is client-led
► Solution approach
requires transparency
► Buyer is prescriptive;
Seller is restricted to
solution buyer requests
► Slow and expensive
The RFS:
The Seller’s Solution
► Focus: evolutionary
contract
► Process is supplier-led
► Commercially available
solutions-utility model
► Buyer does not constrain;
Seller is encouraged to be
innovative & creative
► Faster, less costly
© 2013 Information Services Group, Inc. All Rights Reserved 13
When and why should RFS be considered
The RFS best suits clients who have sourcing experience, a sourcing strategy,
service integration and governance processes in place.
In-scope areas are subject to major
innovation or transformation
A high degree of competition and
solution diversity is needed from
bidders
Speed to an agreement is paramount
and the transaction is solution
focused
For completely new businesses where
there is almost complete flexibility in
technology solution choices
If one of the
following
situations
applies, then RFS
is most likely the
best process to
follow:
The RFS delivers
a Case for
Change within
the client team
when they have
multiple factions
trying to drive in
different
directions
© 2013 Information Services Group, Inc. All Rights Reserved 14
What’s different about RFS?
Using RFS, with expert advice from ISG, ensures clients ask the right questions to
the right providers to get the right solution, in the most time efficient way.
RFI
Query the Market
RFS
Engage the Market
Question Provider’s Answer
Unstructured Unstructured
Structured Unstructured
RFP
Instruct & Test
the Market
Structured Structured
The RFS process and ISG
consultants helps you:
► Ask the right questions –
based on our expertise
► Ask the right service
providers – based on our deal
database
► Ask the questions in the right
context – based on ISG
knowledge of the market and
the business domain
► Interpret the response based
on ISG expertise in
transactions
© 2013 Information Services Group, Inc. All Rights Reserved 15
RFS has many benefits
Solution-driven approach allows service providers to offer their innovative,
thought-leading solutions – or identifies if there are no solutions in the market.
Right providers ►Engaging appropriate providers allows focus, saves time
►Reduces the churn of too many providers with marginal solution
►Dramatically increases probability of finding right solution
►Lowers cost of transaction – for both parties!
Right questions ►Stating the problem clearly allows providers to innovate
►Allows adaptation to market conditions – real time
►Facilitates collaborative process that refines problem statement
►Recognises that there maybe more than one answer
Right experience ►Recent market experience with the provider participants
►Domain experience and data to help evaluate solutions
►Focused on the key questions so the process is no longer that it
needs to be while managing risk!
© 2013 Information Services Group, Inc. All Rights Reserved 16
The RFS Process
The RFS Process to start – then back to Strategy if no success
Check-
point
A
B
Possible RFS outcomes and service design
RFS may not lead exactly where you think it will go . . . If the RFS yields strong and
innovative solutions, it makes sense to continue – otherwise, re-evaluate.
* or solutions!
If no acceptable solutions
emerge, the project must
re-evaluate the Design using
the new information gained
from the RFS process – and
perhaps issue an RFP
If a strong solution
emerges in Phase 1 and 2,
the Client can leverage
Collaborative Contracting
to move through the
Transaction.
Prepare Solution
Due
Diligence
Contract
Transition and
Transformation
Review:
► Sourcing Strategy
► Target Operating Model
► Service Design
© 2013 Information Services Group, Inc. All Rights Reserved 17
Once the Client finds the right solution, the detailed solution and proposed value
are further scrutinized and captured in a market typical sourcing agreement
Time
Primary
Activities
Perform pre-agreement
activities
Assign the team members
Prepare project plan
Conduct kickoff
Develop engagement
package and base case
Determine and contact
participating providers
Assist the service
providers during proposal
development
Conduct solution and
indicative pricing
evaluation
Downselect
Release key contract
documents and pricing
forms
Conduct due diligence and
submit updated proposals
Perform the service
provider walk-through
Evaluate provider solution,
pricing and legal response
Downselect
Develop contract
documents and plan
negotiations
Conduct negotiations
Develop final employee
retention and transfer
plan
Prepare to kickoff
transition/transformation
Sign the contract
Prepare
~ 2 weeks
Solution
~ 6 weeks
Due Diligence
~ 6 weeks
Contract
~ 4 weeks
RFS
Prototypical Schedule
© 2013 Information Services Group, Inc. All Rights Reserved 18
The RFS Methodology
© 2013 Information Services Group, Inc. All Rights Reserved 19
RFS Approach
High level visual depicting the major phases, activities and deliverables
from the ISG RFS sourcing transaction process
Walk-through EAS Sessions MVD Sessions
Prepare
1 – 2 weeks
Solution
6 – 8 weeks
 Engagement scope
 Project plan
 Project kickoff Deck
 Engagement package and
base case
 Provider capabilities and
recomendations
 Evaluation results and
downselect
 Key contract documents
 Due diligence approach
 Updated evaluation model
 Downselect recommendation
 Contract documents
 Negotiations preparation
 Signed contracts
Time
Primary
Activities
Deliverables
6 – 8 weeks
Due Diligence
5 – 6 weeks
Contract
E M WM
E MW
Release key contract
documents and pricing forms
Conduct due diligence and
submit updated proposals
Perform the service provider
walk-through
Evaluate provider solution,
pricing and legal response
Develop future-state SIAM
operating model
Downselect
Develop contract documents
and plan negotiations
Conduct negotiations
Develop final employee
retention and transfer plan
Develop final future-state
SIAM operating model
Prepare to kickoff
transition/transformation
Sign the contract
Develop engagement package
and base case
Assist the service providers
during proposal development
Conduct solution and
indicative pricing evaluation
Develop first pass future-state
SIAMM design work plan
Downselect
Determine and contact
participating providers
Perform pre-agreement
activities
Assign the team members
Prepare project plan
Conduct kickoff
© 2013 Information Services Group, Inc. All Rights Reserved 20
RFS Phase 1: Prepare
Focuses on finalizing the project set-up, preparing the ISG and
COMPANY XYZ project teams for their project role and responsibilities
* Initial interviews with key stakeholders to validate sourcing objectives and prepare kickoff materials.
Prepare Solution Due Diligence Contract
Prepare engagement plan Define engagement plan tasks, responsibilities, timelines and milestones. Validate PSA, SOW
and PO in place.
Identify engagement resources Define project organisation. Communicate resources and responsibilities.
Confirm engagement scope Engagement lead validates defined scope of services with client.
Stakeholder interviews* Conduct interviews to help ISG understand business priorities, obtain contextual information
including project objectives and determine project deliverables expectations.
Develop the kickoff presentation
materials
Develop the deck including the project approach; project plan and milestones; team structure;
assigned resources and their roles and responsibilities.
Conduct the project team
kickoff
Hold a workshop to deliver the kickoff presentation including a Q&A session with the team.
Secure agreement with team on roles, responsibilities and deliverables – begin assignments.
Deliverables Engagement plan Engagement scope Kickoff deck
1
2
3
1 2 3
© 2013 Information Services Group, Inc. All Rights Reserved 21
RFS Phase 2: Solution
Focuses on articulating the objectives and collaborating with a group
of bidders to develop the best solutions to meet the objectives
Prepare Solution Due Diligence Contract
Develop engagement package
and base case
Develop an engagement package to describe the clients sourcing and project objectives,
background and current environment description. Develop base case.
Determine and contact participating
providers
Provide client with ISG provider capabilities materials. Provide ISG recommendation if
requested. Develop provider facing communications and conduct kickoff.
Assist the service providers during
proposal development
Initiate and facilitate a Q&A process to provide clarification. Hold Q&A meetings to discuss
topics as needed. Conduct MVD sessions to provide solution feedback.
Conduct solution and indicative
pricing evaluation
Develop an evaluation model and business case. Review the providers proposals and conduct
MVD sessions to clarify solutions. Evaluate the solutions and indicative pricing.
Develop first pass future-state SIAM
design work plan
Review current service management and governance structures, tools and processes. Develop
future state vision and gap analysis.
Downselect Facilitate scenario, risk and SWAT analysis to help the team develop a recommendation.
Finalize the financial evaluation. Develop and present a steering committee presentation.
Deliverables Engagement package and
base case
Provider capabilities and
recomendations
Evaluation results and
downselect
1
2
3
1 2 3
$$
© 2013 Information Services Group, Inc. All Rights Reserved 22
RFS Phase 3: Due Diligence
Focuses on conducting in-bound and out-bound Due Diligence (DD),
beginning the contracting workstream and helping the Providers
fine-tune their proposals
Prepare Solution Due Diligence Contract
Release key contract
documents
Develop and release MSA, Exhibits 1,2 , 3 and 4 (to the extent necessary) along with a detailed
Attachment 4-A with resource unit baselines.
Conduct due diligence and
submit updated proposals
Conduct outbound and inbound due diligence. Conduct workshops as needed to clarify and
document Technical Solution Document, Transition and Transformation Plans. Provider
submits updated proposal with detailed pricing.
Perform the service provider
walk-through
Conduct MVD or "Walkthrough" of Provider updated proposals. Review the solution, key
contract document responses and detailed pricing response.
Evaluate provider solution,
pricing and legal response
After Provider submits post MVD final bid, conduct evaluation using the valuation model
developed in phase 2.
Develop future-state SIAM
operating model
Develop any revised roles and responsibilities, staff new or changed positions, develop
processes and prepare to stand-up revised organization and processes.
Downselect Facilitate scenario, risk and SWOT analysis to help the team develop a recommendation.
Finalize the financial evaluation. Develop and present a steering committee presentation.
Deliverables Key contract
documents
Due diligence
approach
Evaluation model Downselect
1
3
1
2
4
4
2 3
4
© 2013 Information Services Group, Inc. All Rights Reserved 23
RFS Phase 4: Contract
Focuses on final negotiations and getting to contract.
Prepare Solution Due Diligence Contract
Develop contract documents Develop remaining contract documents not provided in Phase 3. Convert Phase responses to
final documents for negotiations.
Prepare for negotiations Fine tune negotiations strategies and tactics, assign and assemble the negotiations team;
prepare negotiation logistics; document remaining open issues and negotiations objectives;
and prepare and deliver negotiations training.
Conduct negotiations Conduct negotiations; update contract documents and open issues lists as issues are closed;
prepare and conduct follow-on sessions. Track and complete action items.
Develop final future-state SIAM
operating model
Deploy the updated SIAM operating model and processes for "day 1"; continue development
of remaining processes and begin to collaborate with Provider on Service Management
Manual.
Prepare to kickoff
transition/transformation (T&T)
Help the client constitute an internal T&T project team; develop project governance; and
prepare to kickoff the workstream with the Provider after signature.
Sign the contract Signature ready contract documents are developed and processed through COMPANY XYZ and
Provider approval processes and both Parties sign the agreement.
Deliverables Contract documents Negotiations preparation Signed contracts
1
2
3
1 2 3
RFX
© 2013 Information Services Group, Inc. All Rights Reserved 24
Creating Service Innovation with Your Clients
© 2013 Information Services Group, Inc. All Rights Reserved 25
It’s a cliché – but it still causes heartburn in outsourcing
► “Innovation” used 33,528 times in quarterly &
annual reports in 2011
► 255 books published in the first quarter of 2012
with the word Innovation in the title
► 43% of surveyed execs state they have a Chief
Innovation Officer or similar role
► 28% of business schools use the word in their
mission statement
► So. . . What does it mean for our industry?
The Wall Street Journal provided depressing statistics last year. . .
WSJ Marketplace 23 May 2012
© 2013 Information Services Group, Inc. All Rights Reserved 26
The Holy Grail
► Contract may contain an innovation clause, and
governance for innovation
► Clients expect innovation without understanding
the context and are disappointed when they don’t
get it (usually in top 3 things most disappointing in
services relationships)
► ISG observes that innovation is generally hindered
by client behaviors
► We thought it made sense to look at this subject
from the provider perspective
► A while back . . . we tried to do something about it:
TPI research on Innovation – 2008
 Business drivers, investment, organizational
alignment and disciplined execution must all
exist for innovation to occur.
Every client wants innovation from their provider – for free, right now, and to make
huge improvement and/or savings in their work. . .
Need to Innovate Ability to Innovate
Managing the Innovation Model
Business
Innovation
Process
Innovation
Technical
Innovation
© 2013 Information Services Group, Inc. All Rights Reserved 27
What we missed. . .
► We created language for a Terms sheet, a governance meeting name for Innovation
meetings, and processes for how to do it . . . We were sure we had the answer…
► Clients and providers did this, and much beautiful shelfware ensued.
► And nothing has happened; Clients are as unhappy as they have ever been about
innovation – to the extent that we have started to advise clients to not bother with
extensive innovation language in their contracts . . .
We believed that by identifying the requirements, building the processes, and
priming the documents, we could help solve the problem.
Why?
Because innovation is a human-based activity, which needs
humans to engage with each other and to do it together.
© 2013 Information Services Group, Inc. All Rights Reserved 28
What gets in the way of clients and providers working together?
► Episodic and/or infrequent discussions about innovation, allowing it to slip from top-of-
mind
► Failure to identify a meaningful problem that needs to be solved
► Failure to understand (and take on board) required conditions for innovation
► Inability to create an environment of mutual trust
► Perception of motivation of provider (the paradox of outsourcing)
► Reluctance to engage in change – no burning platform
You are the only party in the relationship with the capacity to step back and
evaluate – clients seldom can stop long enough to question.
* Setting corporate culture aside
Often budget is named as the inhibitor, but if the matter is probed, it
becomes much more complex and human factors emerge as the real reason.
© 2013 Information Services Group, Inc. All Rights Reserved 29
And here’s what we heard you say. Let’s discuss further.
We talked to you at last year’s SIC . . .
© 2013 Information Services Group, Inc. All Rights Reserved 30
Define innovation together
► Clients have many different perceptions of innovation
► The lack of a common definition between client and service provider can create
unrealistic expectations or preconceived ideas on the part of the client, which creates
frustration that is directed at you, the provider
Getting a client to come to the table to jointly create a definition can address false
expectations on the client’s side, and open ideas and awareness for you.
How might this work in practice?
► What level of the organization would
you engage for maximum impact?
► Who would come from your side?
► How might such a discussion be framed
up? Facilitated or freewheeling?
► How would your client’s culture affect
how you structured such a meeting?
► What output would you expect? Is a
Mission Statement enough to get you
going? Mission and Actions?
1
© 2013 Information Services Group, Inc. All Rights Reserved 31
Integrate innovation throughout the business
► Not all client companies have a culture of innovation in the back office services
► Many companies see strategic planning and innovation only on the product side of the
business. Finding a way to bring together the business strategy and planning with the
business operations will allow the provider to deliver innovation that matters to the
client’s business.
As a provider delivering common services to multiple clients, you have deep and
unique insight on opportunities for innovation – but clients don’t think about that.
How might this work in practice?
► How might you work with your client to
discover the problem that is most on
their mind, for which an innovative
solution might be applicable?
► How can a service provider “live” the
message of innovation in business
operations so a client sees it?
► What would be done differently day-to-
day?
2
© 2013 Information Services Group, Inc. All Rights Reserved 32
Invest in innovation.
► Technology and back office services are usually seen as cost centers; even though clients
insist on contractual obligations for the provider to deliver innovation, they are generally
not interested in innovation if it costs more
► In addition, pressures on the provider to continuously provide cost savings to the client
means less margin that could incent or pay for innovation
You are spending money continuously to improve your delivery efficiency; how are
your thoughts about your own innovation filtering to your engagement teams?
How might this work in practice?
► Are there resources, visionary
individuals, or think tanks that create
ideas in your organization that can help
educate your client on the need for
investment in innovation?
► How do you change the way you
manage your on-site teams to keep this
door of ideas and innovation open?
► Question?
3
© 2013 Information Services Group, Inc. All Rights Reserved 33
Recognize the difference between “Big I” innovation
and continuous improvement
► Client business executives expect business innovation, but operations executives expect
technical and process innovation; it can be difficult to bridge the gap and create
meaningful solutions that support both areas
► Some forms of continuous improvement can be very valuable to a client both from an
efficiency and a cost savings perspective but do not get the recognition as “Big I”
innovation.
Operations teams often don’t see innovation as their objective – but every dollar
saved through innovation in operations goes straight to the bottom line.
How might this work in practice?
► How would you change your overall
reporting to your client to emphasize the
“little i” or continuous improvement
activities, and link that back to
Innovation?
► Could you bring your own innovation
teams to meet with your client’s
operations people to create awareness
and open eyes?
► Question?
4
© 2013 Information Services Group, Inc. All Rights Reserved 34
Bring more minds to the table.
► You, the provider, can bring leadership to this kind of multiple player situation, but you
need to help your client recognize their role to be the driver.
Multi-service provider environments, which are the norm today, require a number
of providers to be engaged in a complex services situation.
How might this work in practice?
► How would you look at the complex
services of your client, to help bring
them to awareness of the value of
collaboration between providers?
► How would you overcome your own
reluctance to collaborate with a
competitor?
5
© 2013 Information Services Group, Inc. All Rights Reserved 35
How to keep innovation top of mind. . .
► Talk about it – all the time
► Create a program about it
► Make your own people listen through programs to measure apprehension; measure their
frequency to discuss with their customers
► Make metrics that are achievable around young innovation programs
► Understand that innovation may not be earth-shattering to be important, valuable, and
worth the time and effort
We suspect this is as difficult in provider’s client teams as it is in the client
themselves. . . So a program is required.
© 2013 Information Services Group, Inc. All Rights Reserved 36
Continued Evolution
© 2013 Information Services Group, Inc. All Rights Reserved 37
Foundation – Trust & Transparency
Outcome Based
Stage 3
Evolutionary
Contracting
Base*
Contract
2.0
The primary focus of most sourcing initiatives is to get to the base contract. However, the
value of a relationship is to be derived in the evolutionary contracting phase.
Evolutionary Contracting: Key to Continuous Value
► * - Base Contract 2.0: Solutions may be different, but regardless of the approach (top down or bottoms up), a well run process will end up with similar T’s & C’s and market pricing.
Input Based
Stage 1
Transaction Based
Stage 2
Contract Pricing & Terms
Faster Less Costly
Buyer Unconstrained
Seller Innovative & Creative
Approach Requires Transparency
Process Builds Foundation of Trust
Focus on Evolutionary Contract Phase
Focus on Getting to “Perfect” Base Contract
Process is Formal – Trust is Thin
Approach is Closed Book
Seller is Restricted in Solution
Buyer is Prescriptive
Slow/Expensive Innovation
Seller Solution
Buyer Solution
Mutual
Consent
Commerce
© 2013 Information Services Group, Inc. All Rights Reserved 38
What Needs to Change?
The focus of commerce needs to shift from the “deal” or event of signing, to the
framework and evolution of the deal as we move through a dynamic market.
► Base Contract 2.0
 Looks more like 100 pages than 1000
pages
 Ease of expansion AND exit for both
parties
 Focus on bi-lateral transparency
 Rely on trust not legal terms
► Evolutionary Contracting
 Mindset that the contract is an
understanding not a document
 Focus on change and evolving structure
 Input  Transaction  Outcome
 Mutual Consent Commerce
 Both parties need to ensure that the
other party is succeeding.
Base
Contract
Base
Contract
2.0
Contract Term
Evolutionary
Contracting
Typical Base Contract
& Governance Framework
New Framework that recognizes
that the world is changing
faster than we are
© 2013 Information Services Group, Inc. All Rights Reserved 39
The suggested change from RFP to RFS and Evolutionary Contracting is radical and
drives lots of dialog and disagreement. But all revolutions are radical and our
industry needs a revolution.
Typical Client Questions
► Where should I try this? Has anyone done this?
► We have strict rules for buying services, how can I change that?
► What level of transparency is required? What about confidentiality?
► How do I know if I am getting value? Am I leaving something “on the table”?
► Who can help my company explore this?
► My procurement department requires me to compete all new business? How will that
work?
► Trust is personal, how can you develop trust between corporations?
© 2013 Information Services Group, Inc. All Rights Reserved 40
Current Market Perspective and Contracting
The market evolved in terms of maturity, standardization, and modularization. This
should also be reflected in the contract architecture, i.e., the “big contracts” of the
past must be modularized and can often be simplified.
LOW MATURITY AND STANDARDIZATION HIGH(ER)
LOW
HIGH
MODULARIZATION
Past
►Large, complex deals
 Full scope, long term
 Asset and HR transfer
 Dedicated resources
 Customized services/solutions
 High transaction cost
acceptable
►Low degree of flexibility
 Exclusivity
 Inflexible pricing
 Minimum commitments
 Termination next-to-
impossible
►Single-sourcing
 Single provider
 No Service Integration
Today
►Smaller, less complex deals
 Smaller scope, shorter term
 No asset or HR transfer
 Shared resources (e.g., cloud)
 More standardized
services/solutions
 Need for lower transaction cost
►Higher degree of flexibility
 Non-exclusive
 Flexible utility pricing
 Fewer minimum commitments
 Termination less expensive/risky
►Multi-sourcing
 Multiple providers
 Service Integration
© 2013 Information Services Group, Inc. All Rights Reserved 41
Scope-Specific Contract
Relationship-Level Contract
Transaction-Specific Contract
SDC Exhibit
MSA Schedule
Contract Architecture
Provides a scope-agnostic Master Services Agreement (MSA) defining terms on the
relationship, and a Service Delivery Contract with terms specific to a particular
outsourcing transaction and the in-scope services.
Source: ISG, K&L Gates
…
…
Service Delivery
Contract (SDC)
Master Services
Agreement (MSA)
Supplemental Provision X
Supplemental Provision Y
Menu of Supplemental
Provisions
MSA SCHEDULE CONTENTS
Relationship-level details, e.g.,
► Governance
► Customer Policies and
Procedures
SDC EXHIBIT CONTENTS
Service-specific content, e.g.,
► Statement of Work
► Service Levels
► Pricing
► Reports
► Transition/Transformation Plan
SDC CONTENTS
“Wrapper” document
containing those terms that
are specific to a particular
outsourcing transaction
MSA
Scope-agnostic MSA containing
only those terms commonly
and consistently present in
most ITO and BPO deals
WORK IN PROGRESS
© 2013 Information Services Group, Inc. All Rights Reserved 42
Exhibit 4
Pricing
Exhibit 3
SLA
Exhibit 2
SoW
Service Catalog and Contract
The modularization of a contract enables the establishment of a clear link between
a Technical Service Catalog and the corresponding Service Delivery Contract.
Component 1.1
Component 1.2
Tower 1
Tower 2
Component 2.1
Component 2.2
Module 1.1
Module 1.2
Module
Group 1
Module
Group 2
Module 2.1
Module 2.2
Business Product 1.1
Business Product 1.2
Product
Group 1
Product
Group 2
Business Product 2.1
Business Product 2.2
Technical
Product/
Service
Catalog
Business
Product/
Service
Catalog
a b
Product/Service Catalogs Product/Service Structure
ILLUSTRATIVE
Service Delivery Contracts
 Tasks  SLs  RUs
 Tasks  SLs  RUs
 Tasks  SLs  RUs
 Tasks  SLs  RUs
Service Catalog
© 2013 Information Services Group, Inc. All Rights Reserved 43
A change in perspectives on a Service Contract
Contract Management Perspective
► Exhibit 2 – Statement of Work
 Service A
• Task A.1
• Task A.2
 Service B
• Task B.1
• Task B.2
► Exhibit 3 – Service Levels
 Service A
• SLA A.1
• SLA A.2
 Service B
• SLA B.1
• SLA B.2
Service-Oriented Perspective
► Service A
 Exhibit 2 – Statement of Work
• Task A.1
• Task A.2
 Exhibit 3 – Service Levels
• SLA A.1
• SLA A.2
► Service B
 Exhibit 2 – Statement of Work
• Task B.1
• Task B.2
 Exhibit 3 – Service Levels
• SLA B.1
• SLA B.2
Modularization enables content (e.g., tasks, SLAs) to be aligned in a Service-
Oriented Perspective rather than a Contract Management Perspective.
© 2013 Information Services Group, Inc. All Rights Reserved 44
Automation - DecisionDirector – Online RFX Platform
DecisionDirector is ISG’s strategic tool for managing the modularized, authoritative
content and for running RFP processes in the future. The platform provides the
ability to tag and filter content as required.
NOTE
Will use tags to markup content,
e.g., by iSRA service, ISG product
(e.g., “RFP Lite”), and applicability
(e.g., for geography, industry).
www.isg-one.com

Weitere ähnliche Inhalte

Was ist angesagt?

[SirionLabs Webinar] Faster Contracts, Better Contracts: Eliminating the Fric...
[SirionLabs Webinar] Faster Contracts, Better Contracts: Eliminating the Fric...[SirionLabs Webinar] Faster Contracts, Better Contracts: Eliminating the Fric...
[SirionLabs Webinar] Faster Contracts, Better Contracts: Eliminating the Fric...SirionLabs
 
Reference models a case study for healthcare
Reference models a case study for healthcareReference models a case study for healthcare
Reference models a case study for healthcareReal IRM
 
How Technology is changing Bidding
How Technology is changing BiddingHow Technology is changing Bidding
How Technology is changing BiddingAmplio Services
 
Future of Procurement: The Technology Agenda
Future of Procurement: The Technology Agenda Future of Procurement: The Technology Agenda
Future of Procurement: The Technology Agenda SAP Ariba
 
Tactical Competitive Intelligence for Bid teams
Tactical Competitive Intelligence for Bid teamsTactical Competitive Intelligence for Bid teams
Tactical Competitive Intelligence for Bid teamsAmplio Services
 
Business Commerce Innovation [Chicago]
Business Commerce Innovation [Chicago]Business Commerce Innovation [Chicago]
Business Commerce Innovation [Chicago]SAP Ariba
 
PIPL - Practice Area Legal Services Sourcing
PIPL - Practice Area Legal Services SourcingPIPL - Practice Area Legal Services Sourcing
PIPL - Practice Area Legal Services SourcingDr. Sanjeev B Ahuja
 
It smf presentation feb 2017
It smf presentation   feb 2017It smf presentation   feb 2017
It smf presentation feb 2017Troy Latter
 
Purchasing Future Trends 2015
Purchasing Future Trends 2015Purchasing Future Trends 2015
Purchasing Future Trends 2015Bill Kohnen
 
Bridging the Gap Between Finance and Procurement
Bridging the Gap Between Finance and ProcurementBridging the Gap Between Finance and Procurement
Bridging the Gap Between Finance and ProcurementJon Hansen
 
Procurement Savings by the Numbers
Procurement Savings by the NumbersProcurement Savings by the Numbers
Procurement Savings by the NumbersZycus
 
Backoffice Au Pk HTD
Backoffice Au Pk HTDBackoffice Au Pk HTD
Backoffice Au Pk HTDHujaj Khan
 
Operations As-a-Service - The Untapped Opportunity
Operations As-a-Service - The Untapped OpportunityOperations As-a-Service - The Untapped Opportunity
Operations As-a-Service - The Untapped OpportunityRussell Ives
 
Dcx Managed Talent Solutions brochure final 23042014
Dcx Managed Talent Solutions brochure final 23042014Dcx Managed Talent Solutions brochure final 23042014
Dcx Managed Talent Solutions brochure final 23042014Esthea H
 
2018 key issues study for procurement leaders
2018 key issues study for procurement leaders2018 key issues study for procurement leaders
2018 key issues study for procurement leadersZycus
 
Executive Buyers Guide
Executive Buyers GuideExecutive Buyers Guide
Executive Buyers Guideefinver
 

Was ist angesagt? (20)

[SirionLabs Webinar] Faster Contracts, Better Contracts: Eliminating the Fric...
[SirionLabs Webinar] Faster Contracts, Better Contracts: Eliminating the Fric...[SirionLabs Webinar] Faster Contracts, Better Contracts: Eliminating the Fric...
[SirionLabs Webinar] Faster Contracts, Better Contracts: Eliminating the Fric...
 
Reference models a case study for healthcare
Reference models a case study for healthcareReference models a case study for healthcare
Reference models a case study for healthcare
 
How Technology is changing Bidding
How Technology is changing BiddingHow Technology is changing Bidding
How Technology is changing Bidding
 
Future of Procurement: The Technology Agenda
Future of Procurement: The Technology Agenda Future of Procurement: The Technology Agenda
Future of Procurement: The Technology Agenda
 
Tactical Competitive Intelligence for Bid teams
Tactical Competitive Intelligence for Bid teamsTactical Competitive Intelligence for Bid teams
Tactical Competitive Intelligence for Bid teams
 
Business Commerce Innovation [Chicago]
Business Commerce Innovation [Chicago]Business Commerce Innovation [Chicago]
Business Commerce Innovation [Chicago]
 
2015-MMD-Vision1
2015-MMD-Vision12015-MMD-Vision1
2015-MMD-Vision1
 
MMD_Vision 2015
MMD_Vision 2015MMD_Vision 2015
MMD_Vision 2015
 
Market Trends in Commercial Agreements
Market Trends in Commercial AgreementsMarket Trends in Commercial Agreements
Market Trends in Commercial Agreements
 
PIPL - Practice Area Legal Services Sourcing
PIPL - Practice Area Legal Services SourcingPIPL - Practice Area Legal Services Sourcing
PIPL - Practice Area Legal Services Sourcing
 
It smf presentation feb 2017
It smf presentation   feb 2017It smf presentation   feb 2017
It smf presentation feb 2017
 
Purchasing Future Trends 2015
Purchasing Future Trends 2015Purchasing Future Trends 2015
Purchasing Future Trends 2015
 
Bridging the Gap Between Finance and Procurement
Bridging the Gap Between Finance and ProcurementBridging the Gap Between Finance and Procurement
Bridging the Gap Between Finance and Procurement
 
Legal Resource Group Presentation
Legal Resource Group PresentationLegal Resource Group Presentation
Legal Resource Group Presentation
 
Procurement Savings by the Numbers
Procurement Savings by the NumbersProcurement Savings by the Numbers
Procurement Savings by the Numbers
 
Backoffice Au Pk HTD
Backoffice Au Pk HTDBackoffice Au Pk HTD
Backoffice Au Pk HTD
 
Operations As-a-Service - The Untapped Opportunity
Operations As-a-Service - The Untapped OpportunityOperations As-a-Service - The Untapped Opportunity
Operations As-a-Service - The Untapped Opportunity
 
Dcx Managed Talent Solutions brochure final 23042014
Dcx Managed Talent Solutions brochure final 23042014Dcx Managed Talent Solutions brochure final 23042014
Dcx Managed Talent Solutions brochure final 23042014
 
2018 key issues study for procurement leaders
2018 key issues study for procurement leaders2018 key issues study for procurement leaders
2018 key issues study for procurement leaders
 
Executive Buyers Guide
Executive Buyers GuideExecutive Buyers Guide
Executive Buyers Guide
 

Andere mochten auch

Getting Smart With IT Investment: IT Cost Analyses Should Link to Business Ac...
Getting Smart With IT Investment: IT Cost Analyses Should Link to Business Ac...Getting Smart With IT Investment: IT Cost Analyses Should Link to Business Ac...
Getting Smart With IT Investment: IT Cost Analyses Should Link to Business Ac...Information Services Group (ISG)
 
Synergies between mitigation and adaptation..ppt glf nov 16
Synergies between mitigation and adaptation..ppt glf nov 16Synergies between mitigation and adaptation..ppt glf nov 16
Synergies between mitigation and adaptation..ppt glf nov 16Liz Kahurani
 
SMART International Symposium for Next Generation Infrastructure: Cost Benefi...
SMART International Symposium for Next Generation Infrastructure: Cost Benefi...SMART International Symposium for Next Generation Infrastructure: Cost Benefi...
SMART International Symposium for Next Generation Infrastructure: Cost Benefi...SMART Infrastructure Facility
 
SMART Seminar Series: The Long Term Dynamics of Interdependent Infrastructure...
SMART Seminar Series: The Long Term Dynamics of Interdependent Infrastructure...SMART Seminar Series: The Long Term Dynamics of Interdependent Infrastructure...
SMART Seminar Series: The Long Term Dynamics of Interdependent Infrastructure...SMART Infrastructure Facility
 
IT and Business Cost Transparency - An Emerging Imperative
IT and Business Cost Transparency - An Emerging ImperativeIT and Business Cost Transparency - An Emerging Imperative
IT and Business Cost Transparency - An Emerging ImperativeInformation Services Group (ISG)
 
ConductingOnlineSurveys_Sue_ch3
ConductingOnlineSurveys_Sue_ch3ConductingOnlineSurveys_Sue_ch3
ConductingOnlineSurveys_Sue_ch3Valerie Sue
 

Andere mochten auch (18)

4Q16 EMEA ISG Index
4Q16 EMEA ISG Index4Q16 EMEA ISG Index
4Q16 EMEA ISG Index
 
Americas SIC 2014 Agenda
Americas SIC 2014 AgendaAmericas SIC 2014 Agenda
Americas SIC 2014 Agenda
 
Getting Smart With IT Investment: IT Cost Analyses Should Link to Business Ac...
Getting Smart With IT Investment: IT Cost Analyses Should Link to Business Ac...Getting Smart With IT Investment: IT Cost Analyses Should Link to Business Ac...
Getting Smart With IT Investment: IT Cost Analyses Should Link to Business Ac...
 
4Q16 Global ISG Index
4Q16 Global ISG Index4Q16 Global ISG Index
4Q16 Global ISG Index
 
DBS2016: Super Emerging Technologies
DBS2016: Super Emerging TechnologiesDBS2016: Super Emerging Technologies
DBS2016: Super Emerging Technologies
 
DBS2016: Beyond Automation
DBS2016: Beyond AutomationDBS2016: Beyond Automation
DBS2016: Beyond Automation
 
The Digital Journey
The Digital JourneyThe Digital Journey
The Digital Journey
 
Centers of Change
Centers of ChangeCenters of Change
Centers of Change
 
DBS2016: Accelerating Innovation
DBS2016: Accelerating InnovationDBS2016: Accelerating Innovation
DBS2016: Accelerating Innovation
 
#DBS2016 Cognizant - The Future of Talent
#DBS2016 Cognizant - The Future of Talent#DBS2016 Cognizant - The Future of Talent
#DBS2016 Cognizant - The Future of Talent
 
ISG’s TBM Market Insights
ISG’s TBM Market InsightsISG’s TBM Market Insights
ISG’s TBM Market Insights
 
Synergies between mitigation and adaptation..ppt glf nov 16
Synergies between mitigation and adaptation..ppt glf nov 16Synergies between mitigation and adaptation..ppt glf nov 16
Synergies between mitigation and adaptation..ppt glf nov 16
 
What Keeps the New CIO Up at Night?
What Keeps the New CIO Up at Night?What Keeps the New CIO Up at Night?
What Keeps the New CIO Up at Night?
 
Arsenal londyn
Arsenal londynArsenal londyn
Arsenal londyn
 
SMART International Symposium for Next Generation Infrastructure: Cost Benefi...
SMART International Symposium for Next Generation Infrastructure: Cost Benefi...SMART International Symposium for Next Generation Infrastructure: Cost Benefi...
SMART International Symposium for Next Generation Infrastructure: Cost Benefi...
 
SMART Seminar Series: The Long Term Dynamics of Interdependent Infrastructure...
SMART Seminar Series: The Long Term Dynamics of Interdependent Infrastructure...SMART Seminar Series: The Long Term Dynamics of Interdependent Infrastructure...
SMART Seminar Series: The Long Term Dynamics of Interdependent Infrastructure...
 
IT and Business Cost Transparency - An Emerging Imperative
IT and Business Cost Transparency - An Emerging ImperativeIT and Business Cost Transparency - An Emerging Imperative
IT and Business Cost Transparency - An Emerging Imperative
 
ConductingOnlineSurveys_Sue_ch3
ConductingOnlineSurveys_Sue_ch3ConductingOnlineSurveys_Sue_ch3
ConductingOnlineSurveys_Sue_ch3
 

Ähnlich wie Creating the Innovation Platform

7 Traits of a Highly Successful Channel Partner
7 Traits of a Highly Successful Channel Partner7 Traits of a Highly Successful Channel Partner
7 Traits of a Highly Successful Channel PartnerZINFI Technologies, Inc.
 
Emerging Deal Constructs – Why, How and What?
Emerging Deal Constructs – Why, How and What?Emerging Deal Constructs – Why, How and What?
Emerging Deal Constructs – Why, How and What?Kapil Puri
 
Innovatively Managing the Business Process to Create Excellence
Innovatively Managing the Business Process to Create ExcellenceInnovatively Managing the Business Process to Create Excellence
Innovatively Managing the Business Process to Create ExcellenceTata Consultancy Services
 
The Power and Promise of SaaS: CA Cloud Service Management Case Study
The Power and Promise of SaaS: CA Cloud Service Management Case StudyThe Power and Promise of SaaS: CA Cloud Service Management Case Study
The Power and Promise of SaaS: CA Cloud Service Management Case StudyCA Technologies
 
Why sourcing speed is critical
Why sourcing speed is criticalWhy sourcing speed is critical
Why sourcing speed is criticalWGroup
 
Next generation IT outsourcing and the global enterprise model (GEM)
Next generation IT outsourcing and the global enterprise model (GEM)Next generation IT outsourcing and the global enterprise model (GEM)
Next generation IT outsourcing and the global enterprise model (GEM)WGroup
 
Staying Strategic How Procurement must Change!
Staying Strategic  How Procurement must Change!Staying Strategic  How Procurement must Change!
Staying Strategic How Procurement must Change!Bill Huber
 
Crescendus™ | B2B Marketing : Practical Tips
Crescendus™ | B2B Marketing : Practical TipsCrescendus™ | B2B Marketing : Practical Tips
Crescendus™ | B2B Marketing : Practical TipsCrescendus™
 
Source One Overview
Source One OverviewSource One Overview
Source One OverviewJon Hansen
 
Becoming A Digital Business
Becoming A Digital BusinessBecoming A Digital Business
Becoming A Digital BusinessKen Polotan
 
Soln deck business operations support services_final
Soln deck business operations support services_finalSoln deck business operations support services_final
Soln deck business operations support services_finalAdobe
 
Take The Highway To A Successful It Project
Take The Highway To A Successful It ProjectTake The Highway To A Successful It Project
Take The Highway To A Successful It Projectsantosh singh
 
Rajesh Garg IE Essay H
Rajesh Garg IE Essay HRajesh Garg IE Essay H
Rajesh Garg IE Essay HRajesh Garg
 
Commercialisation strategy for early stage companies.
Commercialisation strategy for early stage companies.Commercialisation strategy for early stage companies.
Commercialisation strategy for early stage companies.philnewman100
 
Next Generation Approaches: Why Smart Buyers should Abandon the Traditional A...
Next Generation Approaches: Why Smart Buyers should Abandon the Traditional A...Next Generation Approaches: Why Smart Buyers should Abandon the Traditional A...
Next Generation Approaches: Why Smart Buyers should Abandon the Traditional A...EightyTwenty Insight
 
McHenry whitepaper trc as asp recordkeeping service
McHenry whitepaper trc as asp recordkeeping serviceMcHenry whitepaper trc as asp recordkeeping service
McHenry whitepaper trc as asp recordkeeping serviceCraig Burma
 
Enterprise SaaS: A Mismatch Made in Heaven
Enterprise SaaS: A Mismatch Made in HeavenEnterprise SaaS: A Mismatch Made in Heaven
Enterprise SaaS: A Mismatch Made in HeavenStanton Jones
 

Ähnlich wie Creating the Innovation Platform (20)

7 Traits of a Highly Successful Channel Partner
7 Traits of a Highly Successful Channel Partner7 Traits of a Highly Successful Channel Partner
7 Traits of a Highly Successful Channel Partner
 
Emerging Deal Constructs – Why, How and What?
Emerging Deal Constructs – Why, How and What?Emerging Deal Constructs – Why, How and What?
Emerging Deal Constructs – Why, How and What?
 
Innovatively Managing the Business Process to Create Excellence
Innovatively Managing the Business Process to Create ExcellenceInnovatively Managing the Business Process to Create Excellence
Innovatively Managing the Business Process to Create Excellence
 
The Power and Promise of SaaS: CA Cloud Service Management Case Study
The Power and Promise of SaaS: CA Cloud Service Management Case StudyThe Power and Promise of SaaS: CA Cloud Service Management Case Study
The Power and Promise of SaaS: CA Cloud Service Management Case Study
 
Why sourcing speed is critical
Why sourcing speed is criticalWhy sourcing speed is critical
Why sourcing speed is critical
 
Next generation IT outsourcing and the global enterprise model (GEM)
Next generation IT outsourcing and the global enterprise model (GEM)Next generation IT outsourcing and the global enterprise model (GEM)
Next generation IT outsourcing and the global enterprise model (GEM)
 
Staying Strategic How Procurement must Change!
Staying Strategic  How Procurement must Change!Staying Strategic  How Procurement must Change!
Staying Strategic How Procurement must Change!
 
Crescendus™ | B2B Marketing : Practical Tips
Crescendus™ | B2B Marketing : Practical TipsCrescendus™ | B2B Marketing : Practical Tips
Crescendus™ | B2B Marketing : Practical Tips
 
Source One Overview
Source One OverviewSource One Overview
Source One Overview
 
Staying the Course
Staying the CourseStaying the Course
Staying the Course
 
Becoming A Digital Business
Becoming A Digital BusinessBecoming A Digital Business
Becoming A Digital Business
 
Soln deck business operations support services_final
Soln deck business operations support services_finalSoln deck business operations support services_final
Soln deck business operations support services_final
 
Take The Highway To A Successful It Project
Take The Highway To A Successful It ProjectTake The Highway To A Successful It Project
Take The Highway To A Successful It Project
 
Rajesh Garg IE Essay H
Rajesh Garg IE Essay HRajesh Garg IE Essay H
Rajesh Garg IE Essay H
 
Selling Solutions
Selling SolutionsSelling Solutions
Selling Solutions
 
Commercialisation strategy for early stage companies.
Commercialisation strategy for early stage companies.Commercialisation strategy for early stage companies.
Commercialisation strategy for early stage companies.
 
Next Generation Approaches: Why Smart Buyers should Abandon the Traditional A...
Next Generation Approaches: Why Smart Buyers should Abandon the Traditional A...Next Generation Approaches: Why Smart Buyers should Abandon the Traditional A...
Next Generation Approaches: Why Smart Buyers should Abandon the Traditional A...
 
McHenry whitepaper trc as asp recordkeeping service
McHenry whitepaper trc as asp recordkeeping serviceMcHenry whitepaper trc as asp recordkeeping service
McHenry whitepaper trc as asp recordkeeping service
 
Enterprise SaaS: A Mismatch Made in Heaven
Enterprise SaaS: A Mismatch Made in HeavenEnterprise SaaS: A Mismatch Made in Heaven
Enterprise SaaS: A Mismatch Made in Heaven
 
The Enterprise and SaaS
The Enterprise and SaaSThe Enterprise and SaaS
The Enterprise and SaaS
 

Mehr von Information Services Group (ISG)

Mehr von Information Services Group (ISG) (20)

3Q22 Global ISG Index™
3Q22 Global ISG Index™3Q22 Global ISG Index™
3Q22 Global ISG Index™
 
2Q22 Global ISG Index™
2Q22 Global ISG Index™2Q22 Global ISG Index™
2Q22 Global ISG Index™
 
1Q22 Global ISG Index™
1Q22 Global ISG Index™1Q22 Global ISG Index™
1Q22 Global ISG Index™
 
4Q21 Global ISG Index™
4Q21 Global ISG Index™4Q21 Global ISG Index™
4Q21 Global ISG Index™
 
3Q21 Global ISG Index™
3Q21 Global ISG Index™3Q21 Global ISG Index™
3Q21 Global ISG Index™
 
2Q 2021 ISG Index™
2Q 2021 ISG Index™2Q 2021 ISG Index™
2Q 2021 ISG Index™
 
1Q 2021 Global ISG Index™ Infographic
1Q 2021 Global ISG Index™ Infographic1Q 2021 Global ISG Index™ Infographic
1Q 2021 Global ISG Index™ Infographic
 
1Q 2021 Global ISG Index™
1Q 2021 Global ISG Index™1Q 2021 Global ISG Index™
1Q 2021 Global ISG Index™
 
4Q 2020 Global ISG Index™ Infographic
4Q 2020 Global ISG Index™ Infographic4Q 2020 Global ISG Index™ Infographic
4Q 2020 Global ISG Index™ Infographic
 
4Q 2020 Global ISG Index™
4Q 2020 Global ISG Index™4Q 2020 Global ISG Index™
4Q 2020 Global ISG Index™
 
3Q 2020 Global ISG Index™ Infographic
3Q 2020 Global ISG Index™ Infographic3Q 2020 Global ISG Index™ Infographic
3Q 2020 Global ISG Index™ Infographic
 
2Q 2020 Global ISG Index™ Infographic
2Q 2020 Global ISG Index™ Infographic2Q 2020 Global ISG Index™ Infographic
2Q 2020 Global ISG Index™ Infographic
 
2Q 2020 Global ISG Index™
2Q 2020 Global ISG Index™2Q 2020 Global ISG Index™
2Q 2020 Global ISG Index™
 
1Q20 Global ISG Index™ Infographic
1Q20 Global ISG Index™ Infographic1Q20 Global ISG Index™ Infographic
1Q20 Global ISG Index™ Infographic
 
1Q20 Global ISG Index™
1Q20 Global ISG Index™1Q20 Global ISG Index™
1Q20 Global ISG Index™
 
Full Year 2019 EMEA ISG Index™
Full Year 2019 EMEA ISG Index™Full Year 2019 EMEA ISG Index™
Full Year 2019 EMEA ISG Index™
 
4Q 2019 Global ISG Index™ Infographic
4Q 2019 Global ISG Index™ Infographic4Q 2019 Global ISG Index™ Infographic
4Q 2019 Global ISG Index™ Infographic
 
4Q 2019 Global ISG Index™
4Q 2019 Global ISG Index™4Q 2019 Global ISG Index™
4Q 2019 Global ISG Index™
 
2Q19 Global ISG Index™
2Q19 Global ISG Index™2Q19 Global ISG Index™
2Q19 Global ISG Index™
 
2Q19 Global ISG Index™ Infographic
2Q19 Global ISG Index™ Infographic2Q19 Global ISG Index™ Infographic
2Q19 Global ISG Index™ Infographic
 

Kürzlich hochgeladen

Cybersecurity Awareness Training Presentation v2024.03
Cybersecurity Awareness Training Presentation v2024.03Cybersecurity Awareness Training Presentation v2024.03
Cybersecurity Awareness Training Presentation v2024.03DallasHaselhorst
 
Fordham -How effective decision-making is within the IT department - Analysis...
Fordham -How effective decision-making is within the IT department - Analysis...Fordham -How effective decision-making is within the IT department - Analysis...
Fordham -How effective decision-making is within the IT department - Analysis...Peter Ward
 
How To Simplify Your Scheduling with AI Calendarfly The Hassle-Free Online Bo...
How To Simplify Your Scheduling with AI Calendarfly The Hassle-Free Online Bo...How To Simplify Your Scheduling with AI Calendarfly The Hassle-Free Online Bo...
How To Simplify Your Scheduling with AI Calendarfly The Hassle-Free Online Bo...SOFTTECHHUB
 
Excvation Safety for safety officers reference
Excvation Safety for safety officers referenceExcvation Safety for safety officers reference
Excvation Safety for safety officers referencessuser2c065e
 
Appkodes Tinder Clone Script with Customisable Solutions.pptx
Appkodes Tinder Clone Script with Customisable Solutions.pptxAppkodes Tinder Clone Script with Customisable Solutions.pptx
Appkodes Tinder Clone Script with Customisable Solutions.pptxappkodes
 
1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdfShaun Heinrichs
 
Healthcare Feb. & Mar. Healthcare Newsletter
Healthcare Feb. & Mar. Healthcare NewsletterHealthcare Feb. & Mar. Healthcare Newsletter
Healthcare Feb. & Mar. Healthcare NewsletterJamesConcepcion7
 
TriStar Gold Corporate Presentation - April 2024
TriStar Gold Corporate Presentation - April 2024TriStar Gold Corporate Presentation - April 2024
TriStar Gold Corporate Presentation - April 2024Adnet Communications
 
EUDR Info Meeting Ethiopian coffee exporters
EUDR Info Meeting Ethiopian coffee exportersEUDR Info Meeting Ethiopian coffee exporters
EUDR Info Meeting Ethiopian coffee exportersPeter Horsten
 
Unveiling the Soundscape Music for Psychedelic Experiences
Unveiling the Soundscape Music for Psychedelic ExperiencesUnveiling the Soundscape Music for Psychedelic Experiences
Unveiling the Soundscape Music for Psychedelic ExperiencesDoe Paoro
 
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...ssuserf63bd7
 
NAB Show Exhibitor List 2024 - Exhibitors Data
NAB Show Exhibitor List 2024 - Exhibitors DataNAB Show Exhibitor List 2024 - Exhibitors Data
NAB Show Exhibitor List 2024 - Exhibitors DataExhibitors Data
 
Entrepreneurship lessons in Philippines
Entrepreneurship lessons in  PhilippinesEntrepreneurship lessons in  Philippines
Entrepreneurship lessons in PhilippinesDavidSamuel525586
 
business environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxbusiness environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxShruti Mittal
 
Guide Complete Set of Residential Architectural Drawings PDF
Guide Complete Set of Residential Architectural Drawings PDFGuide Complete Set of Residential Architectural Drawings PDF
Guide Complete Set of Residential Architectural Drawings PDFChandresh Chudasama
 
Introducing the Analogic framework for business planning applications
Introducing the Analogic framework for business planning applicationsIntroducing the Analogic framework for business planning applications
Introducing the Analogic framework for business planning applicationsKnowledgeSeed
 
Supercharge Your eCommerce Stores-acowebs
Supercharge Your eCommerce Stores-acowebsSupercharge Your eCommerce Stores-acowebs
Supercharge Your eCommerce Stores-acowebsGOKUL JS
 
How Generative AI Is Transforming Your Business | Byond Growth Insights | Apr...
How Generative AI Is Transforming Your Business | Byond Growth Insights | Apr...How Generative AI Is Transforming Your Business | Byond Growth Insights | Apr...
How Generative AI Is Transforming Your Business | Byond Growth Insights | Apr...Hector Del Castillo, CPM, CPMM
 
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...Associazione Digital Days
 
Darshan Hiranandani [News About Next CEO].pdf
Darshan Hiranandani [News About Next CEO].pdfDarshan Hiranandani [News About Next CEO].pdf
Darshan Hiranandani [News About Next CEO].pdfShashank Mehta
 

Kürzlich hochgeladen (20)

Cybersecurity Awareness Training Presentation v2024.03
Cybersecurity Awareness Training Presentation v2024.03Cybersecurity Awareness Training Presentation v2024.03
Cybersecurity Awareness Training Presentation v2024.03
 
Fordham -How effective decision-making is within the IT department - Analysis...
Fordham -How effective decision-making is within the IT department - Analysis...Fordham -How effective decision-making is within the IT department - Analysis...
Fordham -How effective decision-making is within the IT department - Analysis...
 
How To Simplify Your Scheduling with AI Calendarfly The Hassle-Free Online Bo...
How To Simplify Your Scheduling with AI Calendarfly The Hassle-Free Online Bo...How To Simplify Your Scheduling with AI Calendarfly The Hassle-Free Online Bo...
How To Simplify Your Scheduling with AI Calendarfly The Hassle-Free Online Bo...
 
Excvation Safety for safety officers reference
Excvation Safety for safety officers referenceExcvation Safety for safety officers reference
Excvation Safety for safety officers reference
 
Appkodes Tinder Clone Script with Customisable Solutions.pptx
Appkodes Tinder Clone Script with Customisable Solutions.pptxAppkodes Tinder Clone Script with Customisable Solutions.pptx
Appkodes Tinder Clone Script with Customisable Solutions.pptx
 
1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf1911 Gold Corporate Presentation Apr 2024.pdf
1911 Gold Corporate Presentation Apr 2024.pdf
 
Healthcare Feb. & Mar. Healthcare Newsletter
Healthcare Feb. & Mar. Healthcare NewsletterHealthcare Feb. & Mar. Healthcare Newsletter
Healthcare Feb. & Mar. Healthcare Newsletter
 
TriStar Gold Corporate Presentation - April 2024
TriStar Gold Corporate Presentation - April 2024TriStar Gold Corporate Presentation - April 2024
TriStar Gold Corporate Presentation - April 2024
 
EUDR Info Meeting Ethiopian coffee exporters
EUDR Info Meeting Ethiopian coffee exportersEUDR Info Meeting Ethiopian coffee exporters
EUDR Info Meeting Ethiopian coffee exporters
 
Unveiling the Soundscape Music for Psychedelic Experiences
Unveiling the Soundscape Music for Psychedelic ExperiencesUnveiling the Soundscape Music for Psychedelic Experiences
Unveiling the Soundscape Music for Psychedelic Experiences
 
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
Intermediate Accounting, Volume 2, 13th Canadian Edition by Donald E. Kieso t...
 
NAB Show Exhibitor List 2024 - Exhibitors Data
NAB Show Exhibitor List 2024 - Exhibitors DataNAB Show Exhibitor List 2024 - Exhibitors Data
NAB Show Exhibitor List 2024 - Exhibitors Data
 
Entrepreneurship lessons in Philippines
Entrepreneurship lessons in  PhilippinesEntrepreneurship lessons in  Philippines
Entrepreneurship lessons in Philippines
 
business environment micro environment macro environment.pptx
business environment micro environment macro environment.pptxbusiness environment micro environment macro environment.pptx
business environment micro environment macro environment.pptx
 
Guide Complete Set of Residential Architectural Drawings PDF
Guide Complete Set of Residential Architectural Drawings PDFGuide Complete Set of Residential Architectural Drawings PDF
Guide Complete Set of Residential Architectural Drawings PDF
 
Introducing the Analogic framework for business planning applications
Introducing the Analogic framework for business planning applicationsIntroducing the Analogic framework for business planning applications
Introducing the Analogic framework for business planning applications
 
Supercharge Your eCommerce Stores-acowebs
Supercharge Your eCommerce Stores-acowebsSupercharge Your eCommerce Stores-acowebs
Supercharge Your eCommerce Stores-acowebs
 
How Generative AI Is Transforming Your Business | Byond Growth Insights | Apr...
How Generative AI Is Transforming Your Business | Byond Growth Insights | Apr...How Generative AI Is Transforming Your Business | Byond Growth Insights | Apr...
How Generative AI Is Transforming Your Business | Byond Growth Insights | Apr...
 
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
Lucia Ferretti, Lead Business Designer; Matteo Meschini, Business Designer @T...
 
Darshan Hiranandani [News About Next CEO].pdf
Darshan Hiranandani [News About Next CEO].pdfDarshan Hiranandani [News About Next CEO].pdf
Darshan Hiranandani [News About Next CEO].pdf
 

Creating the Innovation Platform

  • 1. © 2013 Information Services Group, Inc. All Rights Reserved. Proprietary and Confidential. No part of this document may be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval devices or systems, without prior written permission from Information Services Group, Inc. Creating the Innovation Platform – RFS and Other Techniques Dave Tienstra – Partner – Retail, CPG, Travel & Transportation, Hospitality Clay Calhoun – Partner – Banking, Financial Services, Insurance Paul Schmidt – Partner – Retail, CPG, Travel & Transportation, Hospitality September 10, 2013 2013 Sourcing Industry Conference
  • 2. © 2013 Information Services Group, Inc. All Rights Reserved 2 A Market View
  • 3. © 2013 Information Services Group, Inc. All Rights Reserved 3 The CIO Heat Map has never been more complex. Many players in the eco-system are opining from north, south, east and west. Issues that are on the Desk of our Clients Big Data IT Consumerization Green Talent Management Security Business Unit Alignment Business Enabler Vs. Business Inhibitor Self-Funding Models Unified Communications & Analytics
  • 4. © 2013 Information Services Group, Inc. All Rights Reserved 4 In today’s market, change is everywhere and is accelerating exponentially… Pace of Change Change Time This suggests that if we adjust our pace of learning, that we will remain aligned. What if the Pace of Change is Non-Linear? What-if?
  • 5. © 2013 Information Services Group, Inc. All Rights Reserved 5 Pace of Learning < Pace of Change In today’s market, the pace of change exceeds our pace of learning. The divide is noticeable and increasing at an alarming rate. Business Alignment Technology & Services Business Practices We are here Growing Misalignment
  • 6. © 2013 Information Services Group, Inc. All Rights Reserved 6 Evolution of procuring a managed service is becoming a revolution Single supplier / multiple functions  Very large contracts  Long duration (~7-10 )  Often lift and shift – custom requirements  Often with asset transfer  9 – 12 month project RFP is best vehicle for going to market due to custom requirements. Often two providers – Infrastructure and ADM split  Large deals  Long duration (~5 – 7)  Leverages best practices  Still leveraging custom requirements  6 -9 month project RFP is a good fit but now includes some industry standard requirements – CMMI, ITIL True multi-sourcing – best provider for the Service and SIAM  Medium size deals  Shorter duration (~5 years)  More use of standard solutions  Usually no asset transfer  4 – 6 month project RFP is an adequate fit and now includes cross-vendor integration (SIAM) requirements Multi-sourcing with new technology, commercial models & new provider entrants  Small size  Short Duration ( 3 – 5 years)  Often includes innovation  3 -4 month project RFP can be too time- consuming and may stifle innovation – what are the alternatives? 2013…1990 2000 2010 PluralisticBipartisanMonolithic Dynamic
  • 7. © 2013 Information Services Group, Inc. All Rights Reserved 7 Where have we been and where are we going? In 2012 ISG suggested that the “RFP is dead” (or should be) in today’s market. In 2013 it is time to explore a framework of Evolutionary Contracting Classic Contracting is decreasing ► RFP is too prescriptive. ► RFP limits innovation. ► RFP’s are too formal and they do not foster trust or transparency ► Need something more flexible in the market  RFS process. ► RFS can yield more innovative solutions for the base contract. ► RFS with Collaborative Contracting, done well, can foster trust and transparency. Evolutionary Contracting is increasing ► Contracts need to evolve over time. ► Static operating models for multi-year durations do not make sense. ► Base Contract is just the beginning of the business relationship – it must grow/evolve or run the risk of becoming outdated and irrelevant. ► Buyers and Sellers need to engage in Mutual Consent Commerce.  True win/win with easy on easy off terms.  Think handshake with 100 pages vs. classical 1000 page contract.  Think dating vs. marriage
  • 8. © 2013 Information Services Group, Inc. All Rights Reserved 8 ISG’s award winning innovation in sourcing process Request for Solution
  • 9. © 2013 Information Services Group, Inc. All Rights Reserved 9 IACCM 2013 Innovation Award - RFS RFS is already short-listed – final award presented in October at the IACCM Americas Forum 2013 in Arizona. IACCM Innovation Awards Recognizing outstanding leadership & innovation in commercial contracting Award for outstanding service providers - For consultants, service or application service providers who have led or enabled high value initiatives at client organizations.
  • 10. © 2013 Information Services Group, Inc. All Rights Reserved 10 Client Innovation Challenges Dialogue ISG has “behind closed doors”…
  • 11. © 2013 Information Services Group, Inc. All Rights Reserved 11 Clients want to source a service, but want innovation too . . . ► Describing innovation in an RFP can be very difficult or impossible  The marketplace for services is changing rapidly – in some cases, so quickly that service provider’s own marketing can’t keep up  Every day there are announcements of new technologies; new and emerging standards; and changing delivery and commercial models ► You could consider a less structured, more collaborative approach to the provider marketplace, and ask for a solution to your problem from providers most suited to know your business, and their best ideas, using their latest offerings! Leverage knowledge to power results – and achieve objectives – and more. The Request for Solution process allows you and your potential providers the best chance to find the right answer for you, and lets the expert provider architect that answer with the very latest technology and business process solutions.
  • 12. © 2013 Information Services Group, Inc. All Rights Reserved 12 RFS allows the Provider to show their best Less prescription, more collaboration, better result. RFS allows the Provider to show their best approach and solution to the problem. How do you leverage the best knowledge to power your results? The RFP: The Buyer’s Solution ► Focus: getting to “perfect” base contract ► Process is client-led ► Solution approach requires transparency ► Buyer is prescriptive; Seller is restricted to solution buyer requests ► Slow and expensive The RFS: The Seller’s Solution ► Focus: evolutionary contract ► Process is supplier-led ► Commercially available solutions-utility model ► Buyer does not constrain; Seller is encouraged to be innovative & creative ► Faster, less costly
  • 13. © 2013 Information Services Group, Inc. All Rights Reserved 13 When and why should RFS be considered The RFS best suits clients who have sourcing experience, a sourcing strategy, service integration and governance processes in place. In-scope areas are subject to major innovation or transformation A high degree of competition and solution diversity is needed from bidders Speed to an agreement is paramount and the transaction is solution focused For completely new businesses where there is almost complete flexibility in technology solution choices If one of the following situations applies, then RFS is most likely the best process to follow: The RFS delivers a Case for Change within the client team when they have multiple factions trying to drive in different directions
  • 14. © 2013 Information Services Group, Inc. All Rights Reserved 14 What’s different about RFS? Using RFS, with expert advice from ISG, ensures clients ask the right questions to the right providers to get the right solution, in the most time efficient way. RFI Query the Market RFS Engage the Market Question Provider’s Answer Unstructured Unstructured Structured Unstructured RFP Instruct & Test the Market Structured Structured The RFS process and ISG consultants helps you: ► Ask the right questions – based on our expertise ► Ask the right service providers – based on our deal database ► Ask the questions in the right context – based on ISG knowledge of the market and the business domain ► Interpret the response based on ISG expertise in transactions
  • 15. © 2013 Information Services Group, Inc. All Rights Reserved 15 RFS has many benefits Solution-driven approach allows service providers to offer their innovative, thought-leading solutions – or identifies if there are no solutions in the market. Right providers ►Engaging appropriate providers allows focus, saves time ►Reduces the churn of too many providers with marginal solution ►Dramatically increases probability of finding right solution ►Lowers cost of transaction – for both parties! Right questions ►Stating the problem clearly allows providers to innovate ►Allows adaptation to market conditions – real time ►Facilitates collaborative process that refines problem statement ►Recognises that there maybe more than one answer Right experience ►Recent market experience with the provider participants ►Domain experience and data to help evaluate solutions ►Focused on the key questions so the process is no longer that it needs to be while managing risk!
  • 16. © 2013 Information Services Group, Inc. All Rights Reserved 16 The RFS Process The RFS Process to start – then back to Strategy if no success Check- point A B Possible RFS outcomes and service design RFS may not lead exactly where you think it will go . . . If the RFS yields strong and innovative solutions, it makes sense to continue – otherwise, re-evaluate. * or solutions! If no acceptable solutions emerge, the project must re-evaluate the Design using the new information gained from the RFS process – and perhaps issue an RFP If a strong solution emerges in Phase 1 and 2, the Client can leverage Collaborative Contracting to move through the Transaction. Prepare Solution Due Diligence Contract Transition and Transformation Review: ► Sourcing Strategy ► Target Operating Model ► Service Design
  • 17. © 2013 Information Services Group, Inc. All Rights Reserved 17 Once the Client finds the right solution, the detailed solution and proposed value are further scrutinized and captured in a market typical sourcing agreement Time Primary Activities Perform pre-agreement activities Assign the team members Prepare project plan Conduct kickoff Develop engagement package and base case Determine and contact participating providers Assist the service providers during proposal development Conduct solution and indicative pricing evaluation Downselect Release key contract documents and pricing forms Conduct due diligence and submit updated proposals Perform the service provider walk-through Evaluate provider solution, pricing and legal response Downselect Develop contract documents and plan negotiations Conduct negotiations Develop final employee retention and transfer plan Prepare to kickoff transition/transformation Sign the contract Prepare ~ 2 weeks Solution ~ 6 weeks Due Diligence ~ 6 weeks Contract ~ 4 weeks RFS Prototypical Schedule
  • 18. © 2013 Information Services Group, Inc. All Rights Reserved 18 The RFS Methodology
  • 19. © 2013 Information Services Group, Inc. All Rights Reserved 19 RFS Approach High level visual depicting the major phases, activities and deliverables from the ISG RFS sourcing transaction process Walk-through EAS Sessions MVD Sessions Prepare 1 – 2 weeks Solution 6 – 8 weeks  Engagement scope  Project plan  Project kickoff Deck  Engagement package and base case  Provider capabilities and recomendations  Evaluation results and downselect  Key contract documents  Due diligence approach  Updated evaluation model  Downselect recommendation  Contract documents  Negotiations preparation  Signed contracts Time Primary Activities Deliverables 6 – 8 weeks Due Diligence 5 – 6 weeks Contract E M WM E MW Release key contract documents and pricing forms Conduct due diligence and submit updated proposals Perform the service provider walk-through Evaluate provider solution, pricing and legal response Develop future-state SIAM operating model Downselect Develop contract documents and plan negotiations Conduct negotiations Develop final employee retention and transfer plan Develop final future-state SIAM operating model Prepare to kickoff transition/transformation Sign the contract Develop engagement package and base case Assist the service providers during proposal development Conduct solution and indicative pricing evaluation Develop first pass future-state SIAMM design work plan Downselect Determine and contact participating providers Perform pre-agreement activities Assign the team members Prepare project plan Conduct kickoff
  • 20. © 2013 Information Services Group, Inc. All Rights Reserved 20 RFS Phase 1: Prepare Focuses on finalizing the project set-up, preparing the ISG and COMPANY XYZ project teams for their project role and responsibilities * Initial interviews with key stakeholders to validate sourcing objectives and prepare kickoff materials. Prepare Solution Due Diligence Contract Prepare engagement plan Define engagement plan tasks, responsibilities, timelines and milestones. Validate PSA, SOW and PO in place. Identify engagement resources Define project organisation. Communicate resources and responsibilities. Confirm engagement scope Engagement lead validates defined scope of services with client. Stakeholder interviews* Conduct interviews to help ISG understand business priorities, obtain contextual information including project objectives and determine project deliverables expectations. Develop the kickoff presentation materials Develop the deck including the project approach; project plan and milestones; team structure; assigned resources and their roles and responsibilities. Conduct the project team kickoff Hold a workshop to deliver the kickoff presentation including a Q&A session with the team. Secure agreement with team on roles, responsibilities and deliverables – begin assignments. Deliverables Engagement plan Engagement scope Kickoff deck 1 2 3 1 2 3
  • 21. © 2013 Information Services Group, Inc. All Rights Reserved 21 RFS Phase 2: Solution Focuses on articulating the objectives and collaborating with a group of bidders to develop the best solutions to meet the objectives Prepare Solution Due Diligence Contract Develop engagement package and base case Develop an engagement package to describe the clients sourcing and project objectives, background and current environment description. Develop base case. Determine and contact participating providers Provide client with ISG provider capabilities materials. Provide ISG recommendation if requested. Develop provider facing communications and conduct kickoff. Assist the service providers during proposal development Initiate and facilitate a Q&A process to provide clarification. Hold Q&A meetings to discuss topics as needed. Conduct MVD sessions to provide solution feedback. Conduct solution and indicative pricing evaluation Develop an evaluation model and business case. Review the providers proposals and conduct MVD sessions to clarify solutions. Evaluate the solutions and indicative pricing. Develop first pass future-state SIAM design work plan Review current service management and governance structures, tools and processes. Develop future state vision and gap analysis. Downselect Facilitate scenario, risk and SWAT analysis to help the team develop a recommendation. Finalize the financial evaluation. Develop and present a steering committee presentation. Deliverables Engagement package and base case Provider capabilities and recomendations Evaluation results and downselect 1 2 3 1 2 3 $$
  • 22. © 2013 Information Services Group, Inc. All Rights Reserved 22 RFS Phase 3: Due Diligence Focuses on conducting in-bound and out-bound Due Diligence (DD), beginning the contracting workstream and helping the Providers fine-tune their proposals Prepare Solution Due Diligence Contract Release key contract documents Develop and release MSA, Exhibits 1,2 , 3 and 4 (to the extent necessary) along with a detailed Attachment 4-A with resource unit baselines. Conduct due diligence and submit updated proposals Conduct outbound and inbound due diligence. Conduct workshops as needed to clarify and document Technical Solution Document, Transition and Transformation Plans. Provider submits updated proposal with detailed pricing. Perform the service provider walk-through Conduct MVD or "Walkthrough" of Provider updated proposals. Review the solution, key contract document responses and detailed pricing response. Evaluate provider solution, pricing and legal response After Provider submits post MVD final bid, conduct evaluation using the valuation model developed in phase 2. Develop future-state SIAM operating model Develop any revised roles and responsibilities, staff new or changed positions, develop processes and prepare to stand-up revised organization and processes. Downselect Facilitate scenario, risk and SWOT analysis to help the team develop a recommendation. Finalize the financial evaluation. Develop and present a steering committee presentation. Deliverables Key contract documents Due diligence approach Evaluation model Downselect 1 3 1 2 4 4 2 3 4
  • 23. © 2013 Information Services Group, Inc. All Rights Reserved 23 RFS Phase 4: Contract Focuses on final negotiations and getting to contract. Prepare Solution Due Diligence Contract Develop contract documents Develop remaining contract documents not provided in Phase 3. Convert Phase responses to final documents for negotiations. Prepare for negotiations Fine tune negotiations strategies and tactics, assign and assemble the negotiations team; prepare negotiation logistics; document remaining open issues and negotiations objectives; and prepare and deliver negotiations training. Conduct negotiations Conduct negotiations; update contract documents and open issues lists as issues are closed; prepare and conduct follow-on sessions. Track and complete action items. Develop final future-state SIAM operating model Deploy the updated SIAM operating model and processes for "day 1"; continue development of remaining processes and begin to collaborate with Provider on Service Management Manual. Prepare to kickoff transition/transformation (T&T) Help the client constitute an internal T&T project team; develop project governance; and prepare to kickoff the workstream with the Provider after signature. Sign the contract Signature ready contract documents are developed and processed through COMPANY XYZ and Provider approval processes and both Parties sign the agreement. Deliverables Contract documents Negotiations preparation Signed contracts 1 2 3 1 2 3 RFX
  • 24. © 2013 Information Services Group, Inc. All Rights Reserved 24 Creating Service Innovation with Your Clients
  • 25. © 2013 Information Services Group, Inc. All Rights Reserved 25 It’s a cliché – but it still causes heartburn in outsourcing ► “Innovation” used 33,528 times in quarterly & annual reports in 2011 ► 255 books published in the first quarter of 2012 with the word Innovation in the title ► 43% of surveyed execs state they have a Chief Innovation Officer or similar role ► 28% of business schools use the word in their mission statement ► So. . . What does it mean for our industry? The Wall Street Journal provided depressing statistics last year. . . WSJ Marketplace 23 May 2012
  • 26. © 2013 Information Services Group, Inc. All Rights Reserved 26 The Holy Grail ► Contract may contain an innovation clause, and governance for innovation ► Clients expect innovation without understanding the context and are disappointed when they don’t get it (usually in top 3 things most disappointing in services relationships) ► ISG observes that innovation is generally hindered by client behaviors ► We thought it made sense to look at this subject from the provider perspective ► A while back . . . we tried to do something about it: TPI research on Innovation – 2008  Business drivers, investment, organizational alignment and disciplined execution must all exist for innovation to occur. Every client wants innovation from their provider – for free, right now, and to make huge improvement and/or savings in their work. . . Need to Innovate Ability to Innovate Managing the Innovation Model Business Innovation Process Innovation Technical Innovation
  • 27. © 2013 Information Services Group, Inc. All Rights Reserved 27 What we missed. . . ► We created language for a Terms sheet, a governance meeting name for Innovation meetings, and processes for how to do it . . . We were sure we had the answer… ► Clients and providers did this, and much beautiful shelfware ensued. ► And nothing has happened; Clients are as unhappy as they have ever been about innovation – to the extent that we have started to advise clients to not bother with extensive innovation language in their contracts . . . We believed that by identifying the requirements, building the processes, and priming the documents, we could help solve the problem. Why? Because innovation is a human-based activity, which needs humans to engage with each other and to do it together.
  • 28. © 2013 Information Services Group, Inc. All Rights Reserved 28 What gets in the way of clients and providers working together? ► Episodic and/or infrequent discussions about innovation, allowing it to slip from top-of- mind ► Failure to identify a meaningful problem that needs to be solved ► Failure to understand (and take on board) required conditions for innovation ► Inability to create an environment of mutual trust ► Perception of motivation of provider (the paradox of outsourcing) ► Reluctance to engage in change – no burning platform You are the only party in the relationship with the capacity to step back and evaluate – clients seldom can stop long enough to question. * Setting corporate culture aside Often budget is named as the inhibitor, but if the matter is probed, it becomes much more complex and human factors emerge as the real reason.
  • 29. © 2013 Information Services Group, Inc. All Rights Reserved 29 And here’s what we heard you say. Let’s discuss further. We talked to you at last year’s SIC . . .
  • 30. © 2013 Information Services Group, Inc. All Rights Reserved 30 Define innovation together ► Clients have many different perceptions of innovation ► The lack of a common definition between client and service provider can create unrealistic expectations or preconceived ideas on the part of the client, which creates frustration that is directed at you, the provider Getting a client to come to the table to jointly create a definition can address false expectations on the client’s side, and open ideas and awareness for you. How might this work in practice? ► What level of the organization would you engage for maximum impact? ► Who would come from your side? ► How might such a discussion be framed up? Facilitated or freewheeling? ► How would your client’s culture affect how you structured such a meeting? ► What output would you expect? Is a Mission Statement enough to get you going? Mission and Actions? 1
  • 31. © 2013 Information Services Group, Inc. All Rights Reserved 31 Integrate innovation throughout the business ► Not all client companies have a culture of innovation in the back office services ► Many companies see strategic planning and innovation only on the product side of the business. Finding a way to bring together the business strategy and planning with the business operations will allow the provider to deliver innovation that matters to the client’s business. As a provider delivering common services to multiple clients, you have deep and unique insight on opportunities for innovation – but clients don’t think about that. How might this work in practice? ► How might you work with your client to discover the problem that is most on their mind, for which an innovative solution might be applicable? ► How can a service provider “live” the message of innovation in business operations so a client sees it? ► What would be done differently day-to- day? 2
  • 32. © 2013 Information Services Group, Inc. All Rights Reserved 32 Invest in innovation. ► Technology and back office services are usually seen as cost centers; even though clients insist on contractual obligations for the provider to deliver innovation, they are generally not interested in innovation if it costs more ► In addition, pressures on the provider to continuously provide cost savings to the client means less margin that could incent or pay for innovation You are spending money continuously to improve your delivery efficiency; how are your thoughts about your own innovation filtering to your engagement teams? How might this work in practice? ► Are there resources, visionary individuals, or think tanks that create ideas in your organization that can help educate your client on the need for investment in innovation? ► How do you change the way you manage your on-site teams to keep this door of ideas and innovation open? ► Question? 3
  • 33. © 2013 Information Services Group, Inc. All Rights Reserved 33 Recognize the difference between “Big I” innovation and continuous improvement ► Client business executives expect business innovation, but operations executives expect technical and process innovation; it can be difficult to bridge the gap and create meaningful solutions that support both areas ► Some forms of continuous improvement can be very valuable to a client both from an efficiency and a cost savings perspective but do not get the recognition as “Big I” innovation. Operations teams often don’t see innovation as their objective – but every dollar saved through innovation in operations goes straight to the bottom line. How might this work in practice? ► How would you change your overall reporting to your client to emphasize the “little i” or continuous improvement activities, and link that back to Innovation? ► Could you bring your own innovation teams to meet with your client’s operations people to create awareness and open eyes? ► Question? 4
  • 34. © 2013 Information Services Group, Inc. All Rights Reserved 34 Bring more minds to the table. ► You, the provider, can bring leadership to this kind of multiple player situation, but you need to help your client recognize their role to be the driver. Multi-service provider environments, which are the norm today, require a number of providers to be engaged in a complex services situation. How might this work in practice? ► How would you look at the complex services of your client, to help bring them to awareness of the value of collaboration between providers? ► How would you overcome your own reluctance to collaborate with a competitor? 5
  • 35. © 2013 Information Services Group, Inc. All Rights Reserved 35 How to keep innovation top of mind. . . ► Talk about it – all the time ► Create a program about it ► Make your own people listen through programs to measure apprehension; measure their frequency to discuss with their customers ► Make metrics that are achievable around young innovation programs ► Understand that innovation may not be earth-shattering to be important, valuable, and worth the time and effort We suspect this is as difficult in provider’s client teams as it is in the client themselves. . . So a program is required.
  • 36. © 2013 Information Services Group, Inc. All Rights Reserved 36 Continued Evolution
  • 37. © 2013 Information Services Group, Inc. All Rights Reserved 37 Foundation – Trust & Transparency Outcome Based Stage 3 Evolutionary Contracting Base* Contract 2.0 The primary focus of most sourcing initiatives is to get to the base contract. However, the value of a relationship is to be derived in the evolutionary contracting phase. Evolutionary Contracting: Key to Continuous Value ► * - Base Contract 2.0: Solutions may be different, but regardless of the approach (top down or bottoms up), a well run process will end up with similar T’s & C’s and market pricing. Input Based Stage 1 Transaction Based Stage 2 Contract Pricing & Terms Faster Less Costly Buyer Unconstrained Seller Innovative & Creative Approach Requires Transparency Process Builds Foundation of Trust Focus on Evolutionary Contract Phase Focus on Getting to “Perfect” Base Contract Process is Formal – Trust is Thin Approach is Closed Book Seller is Restricted in Solution Buyer is Prescriptive Slow/Expensive Innovation Seller Solution Buyer Solution Mutual Consent Commerce
  • 38. © 2013 Information Services Group, Inc. All Rights Reserved 38 What Needs to Change? The focus of commerce needs to shift from the “deal” or event of signing, to the framework and evolution of the deal as we move through a dynamic market. ► Base Contract 2.0  Looks more like 100 pages than 1000 pages  Ease of expansion AND exit for both parties  Focus on bi-lateral transparency  Rely on trust not legal terms ► Evolutionary Contracting  Mindset that the contract is an understanding not a document  Focus on change and evolving structure  Input  Transaction  Outcome  Mutual Consent Commerce  Both parties need to ensure that the other party is succeeding. Base Contract Base Contract 2.0 Contract Term Evolutionary Contracting Typical Base Contract & Governance Framework New Framework that recognizes that the world is changing faster than we are
  • 39. © 2013 Information Services Group, Inc. All Rights Reserved 39 The suggested change from RFP to RFS and Evolutionary Contracting is radical and drives lots of dialog and disagreement. But all revolutions are radical and our industry needs a revolution. Typical Client Questions ► Where should I try this? Has anyone done this? ► We have strict rules for buying services, how can I change that? ► What level of transparency is required? What about confidentiality? ► How do I know if I am getting value? Am I leaving something “on the table”? ► Who can help my company explore this? ► My procurement department requires me to compete all new business? How will that work? ► Trust is personal, how can you develop trust between corporations?
  • 40. © 2013 Information Services Group, Inc. All Rights Reserved 40 Current Market Perspective and Contracting The market evolved in terms of maturity, standardization, and modularization. This should also be reflected in the contract architecture, i.e., the “big contracts” of the past must be modularized and can often be simplified. LOW MATURITY AND STANDARDIZATION HIGH(ER) LOW HIGH MODULARIZATION Past ►Large, complex deals  Full scope, long term  Asset and HR transfer  Dedicated resources  Customized services/solutions  High transaction cost acceptable ►Low degree of flexibility  Exclusivity  Inflexible pricing  Minimum commitments  Termination next-to- impossible ►Single-sourcing  Single provider  No Service Integration Today ►Smaller, less complex deals  Smaller scope, shorter term  No asset or HR transfer  Shared resources (e.g., cloud)  More standardized services/solutions  Need for lower transaction cost ►Higher degree of flexibility  Non-exclusive  Flexible utility pricing  Fewer minimum commitments  Termination less expensive/risky ►Multi-sourcing  Multiple providers  Service Integration
  • 41. © 2013 Information Services Group, Inc. All Rights Reserved 41 Scope-Specific Contract Relationship-Level Contract Transaction-Specific Contract SDC Exhibit MSA Schedule Contract Architecture Provides a scope-agnostic Master Services Agreement (MSA) defining terms on the relationship, and a Service Delivery Contract with terms specific to a particular outsourcing transaction and the in-scope services. Source: ISG, K&L Gates … … Service Delivery Contract (SDC) Master Services Agreement (MSA) Supplemental Provision X Supplemental Provision Y Menu of Supplemental Provisions MSA SCHEDULE CONTENTS Relationship-level details, e.g., ► Governance ► Customer Policies and Procedures SDC EXHIBIT CONTENTS Service-specific content, e.g., ► Statement of Work ► Service Levels ► Pricing ► Reports ► Transition/Transformation Plan SDC CONTENTS “Wrapper” document containing those terms that are specific to a particular outsourcing transaction MSA Scope-agnostic MSA containing only those terms commonly and consistently present in most ITO and BPO deals WORK IN PROGRESS
  • 42. © 2013 Information Services Group, Inc. All Rights Reserved 42 Exhibit 4 Pricing Exhibit 3 SLA Exhibit 2 SoW Service Catalog and Contract The modularization of a contract enables the establishment of a clear link between a Technical Service Catalog and the corresponding Service Delivery Contract. Component 1.1 Component 1.2 Tower 1 Tower 2 Component 2.1 Component 2.2 Module 1.1 Module 1.2 Module Group 1 Module Group 2 Module 2.1 Module 2.2 Business Product 1.1 Business Product 1.2 Product Group 1 Product Group 2 Business Product 2.1 Business Product 2.2 Technical Product/ Service Catalog Business Product/ Service Catalog a b Product/Service Catalogs Product/Service Structure ILLUSTRATIVE Service Delivery Contracts  Tasks  SLs  RUs  Tasks  SLs  RUs  Tasks  SLs  RUs  Tasks  SLs  RUs Service Catalog
  • 43. © 2013 Information Services Group, Inc. All Rights Reserved 43 A change in perspectives on a Service Contract Contract Management Perspective ► Exhibit 2 – Statement of Work  Service A • Task A.1 • Task A.2  Service B • Task B.1 • Task B.2 ► Exhibit 3 – Service Levels  Service A • SLA A.1 • SLA A.2  Service B • SLA B.1 • SLA B.2 Service-Oriented Perspective ► Service A  Exhibit 2 – Statement of Work • Task A.1 • Task A.2  Exhibit 3 – Service Levels • SLA A.1 • SLA A.2 ► Service B  Exhibit 2 – Statement of Work • Task B.1 • Task B.2  Exhibit 3 – Service Levels • SLA B.1 • SLA B.2 Modularization enables content (e.g., tasks, SLAs) to be aligned in a Service- Oriented Perspective rather than a Contract Management Perspective.
  • 44. © 2013 Information Services Group, Inc. All Rights Reserved 44 Automation - DecisionDirector – Online RFX Platform DecisionDirector is ISG’s strategic tool for managing the modularized, authoritative content and for running RFP processes in the future. The platform provides the ability to tag and filter content as required. NOTE Will use tags to markup content, e.g., by iSRA service, ISG product (e.g., “RFP Lite”), and applicability (e.g., for geography, industry).