Wednesday, October 23, 2013

Buying a Service Vs Buying Fulfillment of a Need

Organizations shopping for an external IT Service Vendor struggle to get the best offer from the market, they all appear to be a close match. In such a situation traditional procurement methods hint at evaluating different vendors based on costs, quality and references, in the process they overlook the extent to which their business needs are being fulfilled.

On the other hand IT vendors struggle to position value and differentiate themselves from other similar commoditized vendors, they all get stuck in the bidding war for the lowest price.

At the crux of this problem is a poorly developed statement of requirements that does not explicitly state the needs and ask vendors on how specifically they plan to fulfill those needs.

By me, the problem rests in the procurement processes, statement of requirements need not just list service levels, coverage hours, volumes fulfillment required, but can add their objectives in order of priority and reasons that led them to consider external vendors.

Prepare for a collaborative solution design sessions, vendors are equipped with subject matter experts who can get to the details in your organization to scope what is required and its attributes to size and price the effort for fulfillment.

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