Skillsets

• Business process engineering
• Program management
• Strategic procurement

Technologies

Servers, storage, communications, and software

Procurement Efficiencies

Case Study

Background

IT infrastructure purchasing requires dozens of components for one system purchase. The challenge of this type of procurement combined with the “challenge of negotiations” had manager’s spending a lot of time focused on purchasing. As the level and value of purchases grew, the organization struggled to achieve its primary objective, supporting and enhancing infrastructure capabilities and services. After attempting to solve with additional resources, this firm contacted Harvard Partners.

What We Did

Increasing order volumes across a diversity of suppliers required a fundamental change in approach. With executive sponsorship and support, the IT infrastructure procurement function was outsourced. Managers began to understand strategic procurement has a lifecycle and leverage the outsourced resources. Through outsourcing more time was spend understanding vendors, configurations, and negotiation strategies. A full-time, local, outsourced procurement specialist became an integral part of the management team and had the ability to begin the procurement lifecycle as new projects were being discussed and approved.

Vendor relationships were maintained with the client as pre-sales and post-purchase support were a significant part of the vendor value proposition. Personal relationships between the client and their vendors improved as the outsourced resources became the “bad cop” in all negotiations.

What We Achieved

The greatest benefit of this arrangement was a 30% recovery of manager’s time. Time normally spent on system configurations, vendor negotiations, RFQs data entry, and validation of receipt of goods was now used for value-added system enhancements. Vendor discounts never increased and typically decreased. Vendor competition grew as more RFQ’s were issued.

Getting managers to relinquish the execution of negotiations and procurement was a challenge. Successful negotiations produced pride and gave mangers “bragging rights.” Saving money was heavily praised and rewarded, so outsourcing procurement was viewed as taking something away from managers. With strong executive sponsorship, managers were rewarded for using and saving money through the outsourced services.

Contact Harvard Partners to learn more about our Strategic IT Procurement programs »

Summary