Hope you and your loved ones had a safe and enjoyable holiday and best wishes for 2019!!! While you are still recovering and thinking about this year, let me suggest that you make this the year to focus on identifying the right Stakeholders and their Value Drivers (VDs). And if you think you already do, let me congratulate you and then recommend that you double your efforts. There is significant value for all involved, including you. I know we’ve been preaching this sermon for quite a while, but it may be worth repeating.
Time and again we have applied this approach and time and again it has worked. We have applied it in helping develop and implement a governance model by ensuring that the client identified all the right stakeholders and their Value Drivers. We have applied it numerous times in various Transformation efforts. We have applied it in various Category Management engagements and let me share a particular one in detail. We were brought in by IT procurement to help select and negotiate an ERP package($100MM) for a F50 company and clearly their primary VD was best price. We were fortunate enough to have a project executive who agreed with the approach that we were recommending which was to expand the pool of stakeholders and identify their VDs. It became obvious to all that the CIO had a different set of VDs than the CFO whose were different than the Project Executive whose were different than the Country Managers – you get the point. The CIO wanted to ensure that a prototype solution validating the choice of the software was part of the contract. The CFO wanted price protection for 10 years. The Project Executive was being measured on how quickly the solution was deployed across the company so she wanted the software contract to reflect that metric. The Country Managers did not want to give up their autonomy and wanted some local influence and control with the software provider. It was only by having a structured process that is designed to identify the right stakeholders and their Value Drivers were we able to:
- develop a very integrated negotiation strategy that delivered all the VDs
- create alignment by the process both pre-negotiation and support for the ultimate solution
- change the reputation and image of the procurement function from a transaction executioner to a strategic partner
- reduce the overall risk to the project significantly
- align Metrics to be included in the contract to support client VDs
Here is another example that you may have seen already where the client (major for profit educational corporation) brought us in to negotiate a contract to buy books cheaper and ended up not buying books at all!!!
And lest you think this only applies to a sourcing situation, here is an example of the approach being applied to a CRM project internally. It was by applying this approach that we were able to expand the pool of stakeholders, and by focusing on their VDs, not only were we able to secure the necessary funding for the solution on behalf of the client but we were also able to set up the Advisory Board for the initiative in the C-Suite because of the VDs that we identified associated with the CRM solution.
So have another spicy Bloody Mary to get rid of the hangover and then let this year be when you start adopting this approach – I personally promise that you will have a phenomenally successful year!!