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Ramp Rate Methodology Overview Sn
1.
RampRate Methodology Review
Presented by: Steve Nguyen Sourcing Advisor 714-889-9382 sn@ramprate.com Confidential ©RampRate™ Slide 1
2.
Who Is RampRate?
RampRate advises on sourcing or sale of IT services: colocation, managed hosting, cloud, content delivery, network and telco • Reduces decision timeframe • Adds market based data driven analysis • Improve pricing, contract terms, service levels RampRate uses data-centric tools to remove IT market inefficiency • SPY Index market database • In vs outsource analysis • Mid-contract renegotiation • Multi vendor normalized bidding Confidential ©RampRate™ Slide 2
3.
Sourcing Advisors for
IT Infrastructure RampRate Services Baselining Benchmarking Enables For Sourcing Research Confidential ©RampRate™ Slide 3
4.
RampRate Clients
Media/Broadcast Finance High-Tech Gaming Publishing Internet/E-Commerce Web 2.0 Telecommunications Confidential ©RampRate™ Slide 4
5.
Data-Driven Decisions with
the SPY Index™ Service Provider Intelligence Index (SPY Index) Drives speed & quality decisions 1. RampRate’s Historical Data • Over 400 multi-quote transactions in 4 years • 1000s of RFQ responses distilled 2. RampRate Research • Primary research on client satisfaction • Ongoing end-user interview program 3. Analyst Research • Inputs from IDC, Telegeography, Aberdeen, Renesys, Alinean, and others 4. Vendor Profiles • Services data, list prices and actual quotes • Pre-loaded database of 350+ vendors 5. Contract / SLA Templates • Streamlined for speed • Embedded best practices and approaches 6. Cultural Compatibility • Cultural fit matching of clients and vendors Confidential ©RampRate™ Slide 5
6.
Results
Immediate and • Resetting contract to market rates has Sustainable Cost proven an average of 30% cost reduction Reductions for RampRate Clients Reduced Risk & • Decisions driven using “street level” data, comprehensive industry knowledge and Improved research Contract • Better Contract Terms and SLAs Faster Decision • Average time to contract is 6-8 weeks Timeframe Confidential ©RampRate™ Slide 6
7.
RampRate Services
Baselining / Operations Consulting • Preparing cost data for benchmarking or sourcing Benchmarking • Comparing a baseline to a market Sourcing Advisory • Making changes based on baseline via renegotiation or RFQ/new vendors Research • Information about a market Confidential ©RampRate™ Slide 7
8.
RampRate Service Verticals
• Rental of space/power/network/remote hands Colocation • DRT, Equinix Infrastructure • Local or remote managed hosting • Cloud Infrastructure As A Service (IaaS) Management • Wipro, HCL, IPSoft, Peer1 • MPLS, WAN, VOIP, any large IP circuit Network Services • IP transit (bandwidth to the internet), point-to-point (DS3) • Level3, XO, Verizon, ATT & Telco • Land lines, mobile Content Delivery • Managed services for delivery of video, software, web pages • Akamai, Limelight Networking (CDN) Confidential ©RampRate™ Slide 8
9.
RampRate DOES NOT
source Hardware/ • Microsoft Enterprise, Software / Licenses Oracle, per-seat licenses • Offshore, customer BPO service Software • Programming, QA, Development graphic design Confidential ©RampRate™ Slide 9
10.
Key Concepts: Buyer
Profile / Strategy Strategic • Multiple services bought from 1 vendor with little / no tactical competitive bidding • Dedicated account management, high touch service, and “one throat to choke” • Signed deals typically fall around 75th percentile of RampRate deals Technical & Vendor Fit • Best facility / SLA, but amenable to competitive bidding • Signed deals typically fall around median of quotes Balanced • Optimized mix of price and service level with some concessions on both • Signed deals typically fall around 25th percentile Price-Conscious • Cost is primary / only selection criterion; service / provider may lack track record • Signed deals typically fall around 10th percentile Confidential ©RampRate™ Slide 10
11.
RampRate Sourcing: How
It Works Baseline built from contracts, bills, inventory Benchmark of Baseline against SPY Index shows gaps in pricing, contract terms, service levels Sourcing - Quote form made from baseline, sent to vendors Quotes analysis Vendor recommendation Final Negotiations Impact Report: Final State vs Baseline Confidential ©RampRate™ Slide 11
12.
The Result: SPY
Index Analysis = Data Driven Insight Price evaluated in context of market Price range determined by Combined 137,000 real- market rates world quotes & for packages deal outcomes Confidential ©RampRate™ Slide 12
13.
Top Line Pricing
Analysis / Benchmark Is Vendor Relationship Truly RampRate Opens Path to Savings Strategic? • If so, moderate savings can be • Negotiation with Vendor or found alternative providers • If not, choice of major savings or • Right-sizing price for service level service gains of each infrastructure component Credit Suisse Preliminary Client Prelim Benchmark Benchmark Dollar Monthyl Expense Spend Strategic Savvis Vendor Technical Option 2: Cut Cost Balanced Price- Conscious % of Optimal Contract Terms Items Not Benchmarked Bandwidth Hourly Labor Managed Hosting / Lease Data Center Confidential ©RampRate™ Slide 13
14.
Top Line Contract
Terms Analysis Few Contract Terms Contract Documentation Match Strategic Price Major Gaps Incomplete Levels • SLAs missing for managed • Over-broad Force Majeure services and network • Slightly flawed: price • Unilateral price increases • Co-location SLA: model needs adjustments • No environmental boilerplate guarantee Credit SuisseBenchmark Client Prelim Preliminary Benchmark Option 1: Improve Contract Monthyl Expense Strategic Savvis Vendor Technical Balanced Price- Conscious % of Optimal Contract Terms Confidential ©RampRate™ Slide 14
15.
SPY Index Sourcing
– Vendor Quote Analysis Build Buyer Selection Criteria Offer Performance vs. Criteria internal SLA / Business Industry Fit, 3% Term Assent, 5% Vendor 1 65% consensus Technology Fit, Price Competitiveness, Price Competitiveness 7% 25% Operational Health on buying Extensibility Vendor 2 57% Technology Fit priorities outside of f ering, 10% Vendor 3 44% Financial Health Vendor 4 31% SLA / Business Term Assent Compare Scalability within Operational Vendor 5 62% of f ering, 15% Health, 20% Scalability within of f ering fit of Vendor 6 45% Industry Fit different Financial Health, 15% Vendor 7 63% Extensibility outside of fering vendor 0% 50% 100% profiles Score Drill-Down Vendor 1 Vendor 2 Vendor 3 Vendor 4 Vendor 5 Vendor 6 Vendor 7 Vendor 8 Operational Health 87% 33% 81% 59% 32% 36% 72% 86% Consoli- 10% SLA 95% 95% 75% 95% 95% 70% 90% 95% dated or 50% Uptime Guarantee (Assume 3 9s) 50% Temperature Guarantee 100% 90% 100% 90% 100% 50% 100% 90% 100% 90% 50% 90% 90% 90% 100% 90% drill-down 10% Facility Protections 71% 76% 60% 67% 70% 70% 63% 78% 50% Facility Tier 75% 75% 50% 75% 75% 75% 75% 75% views of 10% Power Redundancy 80% 80% 100% 50% 80% 75% 50% 50% 10% UPS Duration 53% 53% 53% 40% 40% 0% 33% 100% selection All scorecard parameters reflect deep technical expertise and years of building lasting, low-risk services deals Confidential ©RampRate™ Slide 15
16.
RampRate Sourcing Project
Plan Finalist MSA, Requirements RFQ / VQF Vendor Quote Signed Contract Benchmark SLA, Order Summary Demand Letters Analysis & Impact Report Form(s) Needs SPY Index RFQ /VQF Solicit Select Negotiate Assessment Benchmark Demand Letter Offers Vendor Contract Collect Data Assess Re-sourcing Distribute RFQ Address risks RampRate •Quantities Performance • Create Vendor / VQF •Site visits redline • Budgets •Compare to Quote Form •Additional • Unit Costs users of similar (VQF) and Vendor Q&A references Legal review • SLA Needs service Request for •Detailed Quote (RFQ) Collect transition plan Signature Create Base Set Targets •Finalize target responses Case • Forecast vendor list •Preliminary Finalize Calculate • Finalize costs improvement due diligence sourcing RampRate to benchmark potential Renegotiation •Clarify decisions Impact •Set baseline •Identify •Request •Ensure best •Price for measuring tradeoffs improvement offer is Finalize targets •SLA improvement •Set walk-away submitted & receive draft Select Areas to targets contracts Re-Source or Create apples- •Price Negotiate to-apples •SLA comparison Confidential ©RampRate™ Slide 16
17.
Contact
Steve Nguyen Sourcing Advisor 714-889-9382 sn@ramprate.com Confidential ©RampRate™ Slide 17
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