The Value Of Partnerships Xander Leijnse The Customer Connection, Utrecht, April 2006
Background Unisys “voice of the customer” project, UK – 2001 3rd party interviewed senior personnel from major accounts ALL 68 respondents mentioned “partnership” in one way or another Most RFP’s contain references to partnership
What then? We found there was quite some “partnership confusion” We had little real knowledge of what “partnership” means Research indicated there is not much available to help understand and develop “partnership” So we created PVM to address this opportunity
Service Level Agreements Tactical/Legal/Control Partnership Elements Partnership Relationship Service Level Agreements Return On Investment Governance Tactical/Legal/Control
Review Partnership Definition Continuous Process Preferred Partnership Model Engine Metrics (Baseline) Partnership Charter Partner Actions Workshop Report Improved Relations Definition Workshop Action Management Review Partnership Definition PVM Assessment Engine Detailed Report Suggested Actions Improved Relations Action Management
Financially sound, innovative In-depth Relationship PVM Benchmark Exit - Poor Partnership Poor to Good Partnership Partnering -Loyal World Class Partnership Declining Commencing Reasonable Average Financially sound, innovative In-depth Relationship 446 Current Benchmark Average World Class Target 200 400 600 800 1000 Gap
SMT SMT Coal face Coal face SMT versus coal face Company 1 Company 2 SMT SMT Coal face Coal face
Partnership size independent One to One One to Many Many-to-Many The more complex the relationships then the greater need for PVM
PVM Credentials Academic credentials Unisys Customers - examples Cranfield University Manchester Business School Unisys Customers - examples Merrill Lynch Europe Royal & Sun Alliance (Phoenix) Lloyds of London London Borough of Harrow Unisys Partners - examples Microsoft Belgium Microsoft UK EMC
Case Study - situation Large Investment Bank Unisys holds Outsourcing contract to deliver “managed services” (help desk, desk top support etc.) 25.000 seats Key reasons we won initial contract: ROI Solve IT problem Success? All SLA measures green Customer unhappy! Openly talking about leaving Addressed through Partnership Value Model
Case Study – Mine field vs Mind meld Unisys perception We delivered operational excellence Excellent governance system Customer perception Expectations not met Not happy with performance Question “What Partnership did we both expect/need?” Strategic Value not understood Whatever happened to importance of ROI? Relationship Elements not at all addressed Annual “do you love us” survey Still - Customer / Supplier, not Partner / Partner Tactical Elements over addressed What is measured is being done
Areas to address in PVM Level of Trust Win/win relationship Level of added value Level of shared objectives Long term commitment Equal share of risk and reward Resolution of challenges Sharing of knowledge and information Cultural fit Integration of partnership Financially profitable Joint control of services supplied Sufficient resources to ensure success Communication effectiveness Effectiveness of performance metrics Chances of failure of the partnership Dispute resolution process Individual roles within partnership Patience and tolerance Joint innovation and financial gain
Benefits Strategic Benefits Financial Benefits Working Together Definition of clear strategy that defines aims, objectives and long-term goals An improved return on investment Risk reduction Joint innovation Continual focus on business process improvement Financial Benefits Clear, measurable value for money benefits Continual effort at cost reduction and/or value improvement Working Together Fewer crises Trust Better end to end communications Continuity – people changes have less impact Full, candid, frequent and open communication between all parties Effective mechanism for dispute resolution An exit strategy
And finally Comments Questions Thank you