Thursday, April 23, 2015

IT SOURCING: How Does Your Business Balance the Charge?

A controversial topic from SMBs thru to Enterprise customers, there are as many opinions on this subject as there are people involved, all slightly different of course!

There are several parties involved in getting the equipment required to run your business. Procurement teams bring their specialized negotiation skills, mitigate risk, hash out terms and contract verbiage and, of course, discover cost savings. IT teams know the infrastructure, keep up with new innovations that improve business productivity, know what it will take to implement them, and identify cost savings. These two departments with similar goals often work completely separate when it comes to IT purchases. Vendors are also involved, businesses that want you to spend your company’s hard earned dollars with them. Are they capable of being a trusted advisor?

Coming from a background of both buying and selling IT products over the course of 20 years I have seen some amazing things when it comes to the ways companies spend money. Did I have my favorite suppliers?  You bet!  I liked the companies that were highly responsive, knowledgeable on technology, flexible to work within my budget, dependable and shipped me quality goods.  And in cases where issues occurred, were timely and helpful to resolve them. On the flip side, what did I look for in a good customer as an account manager? Definitely companies who included me in their business needs, who gave me the opportunity to interact with all the folks involved in not only evaluating the technologies but also the decisions to buy. In short, an organization that gave me the chance to add value and one who respected that my time was being invested in their organization and my own company’s at the same time. 

Many technology manufacturers have embraced a pricing structure that gives the best discounts to the vendor that brings them the opportunity first. This adds a level of complexity to projects, especially for businesses that have made a policy to get multiple quotes before making a purchase because suppliers B and C are already at a competitive disadvantage over supplier A that you first mentioned your needs to. The days of getting 3 “apples to apples” quotes and having it be legitimately competitive are over. Companies would be better served to get 3 quotes for different technologies all designed to solve their problem, letting each supplier articulate and demonstrate the value of their solution. What many companies don’t consider is that vendors don’t want to work with you one-time, they want to work with you a LONG time. They want your business to be successful because that means you will continue to make money, grow, thrive and keep using new technologies. What is in your company’s technological best interest is in the IT vendor’s best interest tomorrow, next week and the next 10 years.

The emerging best practice is for procurement and IT teams to work collaboratively on any major technology purchases. Of course, these will represent different dollar values for different size companies. You can further enhance that effort by enlisting a core set of vendors as trusted technology advisors. Involve them early and often, together with procurement and IT. Give them the information they need on your infrastructure and budgets that allow them to offer viable solutions, and reward them with your business when their solution solves the problem you brought to the table. In return, you will get a team of people focused on the same goal and will drive success to your business’s use of technology.


  1. Well said, the best customers care more about solution selling and exploring options as opposed to part number/price.

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