Strategic Sourcing

Align strategic relationships to
organizational goals

Changing Sourcing Models

Deciding whether or not to source IT has become an increasingly complex question with the introduction of automation and cloud-driven solutions. Traditional processes are being disrupted by technology solutions that are designed to replace human support models. As such, the drivers for sourcing have shifted from simply weighing cost savings to seeking best-of-breed solutions, value-based services, flexible pricing, and increased customer satisfaction. With this complexity and changing business models, it is easy to make the wrong sourcing decision. Avasant supports its clients across the entire sourcing lifecycle from strategy, provider selection, implementation and governance.

Client Case Study

Partnerships with technology providers enable cost cutting measures necessary for survival. Avasant helped a large power generation, transmission and distribution company modernize its IT systems, enabling the integration of Smart Systems such as Smart Grid, Distribution Management Systems, Demand Response Systems, Smart Metering and Smart Home Technology. Our recommendations focused on bringing best in class capabilities to create a reliable infrastructure aligned with compliance requirements. These technologies not only optimized costs, they provided added value to their customers through improved responsivity and competitive prices.

Sourcing Strategy

We understand what is needed to improve operations and processes through strategic partnerships.

Our breadth and depth of experience navigating the complex environment of managed services transactions has enabled our clients to optimize IT operations in alignment with core business objectives. Through designing and structuring the right mix of technology, services partnerships, and governance necessary to drive down cost and improve service levels, our clients are consistently able to achieve broader business objectives beyond predictable, low-cost IT and business process services in their partnerships.

Avasant uses its proven methodology to define a sourcing strategy that establishes a business case for change, identifies sourcing opportunities, and helps clients evaluate sourcing partner capabilities that will support the future requirements. Our strategy provides a holistic view of the sourcing landscape based on our deep understanding of industry needs, service provider capabilities and emerging technology trends. Our recommendations balance both long term strategic goals and short term tactical priorities grounded in a comprehensive understanding of our clients’ vision, key business drivers, and constraints. Requirements are prioritized to develop a roadmap with actionable recommendations, attainable milestones, and realistic timelines for implementation. Our clients are well equipped to select ideal sourcing partners and establish the framework to sustain a strong alignment across the entirety of their business functions and strategic objectives.

Sourcing Health Check
Sourcing Strategy Development
Provider Capabilities Assessment
Price Benchmarking

Sourcing Transaction

Our services extend past the selection of sourcing partners; we establish the most viable deal structure for our clients.

In today’s business environment, there is a multitude of agreement types with a complex array of contract terms and provisions. Having numerous choices can provide leverage; however, navigating these agreements and ensuring high value results can be challenging.

Avasant’s legion of contractual experts negotiate strategic relationships that create long term value for the enterprise. The entire transaction is structured to meet each client’s unique goals. Avasant also assesses existing sourcing contracts to ensure that clients are getting the full value of their existing agreements. Perhaps most importantly, considering today’s heightened regulatory environment, Avasant ensures that our clients remain compliant and minimizes risk exposure.

Our team provides clients with an objective methodology for the selection of service providers, and minimizes the possibility of misaligned expectations between client and service provider. We work closely with our affiliate law firm, Avasant Law, to negotiate contracts that appropriately reflect our client’s objectives, constraints, and risk tolerance. We provide the technical expertise to structure master services agreements, develop services statement of works, design the performance criteria, and determine pricing. Avasant ensures that the client’s delivery strategy, performance and business terms are properly captured in a contract that is realistic and enforceable.

Contract Optimization
Software License Optimization
Provider Evaluation and Selection
Due Diligence Management
Contract Development and Negotiation

Sourcing Implementation

Awarding and negotiating a contract is only the beginning of the relationship between the client and service provider.

Successful ventures involve change management processes that enable providers to meet their requirements and allow for internal adjustments. However, many relationships never fully meet the expectations. The primary challenges include lack of a disciplined service implementation process, poorly defined roles, KPIs and expectations, misalignment between objectives and execution, poor organization change management, missed opportunities to govern commitments, and miscommunication.

Avasant’s sourcing implementation solution helps clients navigate the inherent complexities of sourcing relationships. Our strategy roadmap details the steps necessary to realize a flourishing environment capable of managing critical priorities. One of our first areas of focus is on human capital and internal organizational culture. We assist clients with integrating a team of internal retained resources with both new and existing service providers. Our transition planning and execution oversight mitigates any disruption to the business. In order to realize long term goals, we develop a roadmap to achieve high quality governance and oversight. This approach reinforces the responsibilities of each party and ensures that the requirements of the contract are being met.

Transition Planning and Execution
Retained Organization Design and implementation
Program Implementation and Oversight

Sourcing Governance

Poor execution and lack of ongoing governance are the primary reasons strategic goals and objectives are not met.

Some of the key challenges organizations face while executing such strategies include: lack of alignment and synchronization between the service provider and the organization, limited change management skills, misaligned metrics and measurement, poor communication management and lack of accountability between parties. Over 80% of all organizations today fail to successfully manage such mechanisms, and as a result, fall short in achieving their goals and objectives. Effective governance requires a proactive, process based approach that measures progress and performance.

Avasant supports clients throughout the lifecycle of their partnerships to ensure performance and financial results are tangible and realized. Execution typically entails working with a host of internal stakeholders and external service providers, creating a complex governance environment. Our governance approach is comprised of a robust program management process to foster alignment and track progress. Avasant focuses on key consultative aspects such as scope change and impact management, contractual commitments and deliverables governance, and risk management. Our comprehensive solution ensures sourcing strategies are executed as planned in full alignment with the business objectives.