1. Info-Tech Research Group1 Info-Tech Research Group, Inc. Is a global leader in providing IT research and advice. Info-Tech’s products and services combine actionable insight and relevant advice with ready-to-use tools and templates that cover the full spectrum of IT concerns. © 1997-2014 Info-Tech Research Group Inc. Optimize IT Procurement Selecting the right IT solution is a delicate balance between vendor, product, price, and service. Info-Tech's products and services combine actionable insight and relevant advice with ready-to-use tools and templates that cover the full spectrum of IT concerns.© 1997 - 2014 Info-Tech Research Group

2. Info-Tech Research Group2 Introduction IT leaders who oversee or lead procurements: CIO overseeing IT procurement IT director IT manager IT procurement manager Validate your current vendor selection practice Configure a best-practice procurement process to fit your specific needs Define solution requirements and build procurement documentation Objectively evaluate vendor solutions based on your requirements and criteria Select the most suitable vendor solution Be prepared for future audits This Research Is Designed For:This Research Will Help You:

3. Info-Tech Research Group3 Configure your IT procurement process uniquely for each procurement to buy quickly and effectively. Then make the execution excellent and auditable. Executive Summary Position the organization for success by ensuring that you are ready for procurement Choose the right procurement vehicle: RFI, RFQ, RFP, or direct award Use your existing IT procurement process or the included Info-Tech best practice Configure the process to optimize each step by answering just a few questions Build your procurement toolkit using Info- Tech’s templates and guidance Use Info-Tech’s evaluation process and tools to select the right vendor solution Measure your procurement success with the right metrics Have the right tools in place to be objective in balancing cost vs. quality to select the right solution. Track your success over time. Configure your procurement process for each major purchase to maximize your procurement value and minimize time to acquisition.

4. Info-Tech Research Group4 What’s in this Section:Sections: Make the case Start from a solid foundation Begin your procurement Define and build your procurement documentation Evaluate proposals and select a vendor solution Symptoms and consequences of poor IT procurement Measure your procurement – set a baseline Case Study: Process complacency, wasted money Reap the benefits of buying IT right Upgrade your IT procurement process

5. Info-Tech Research Group5 Bad procurement can hide anywhere; searching for the symptoms can help reveal the truth. Look for the symptoms of problems with IT procurement Has this happened to you? End users hate the system and tell you that you bought the wrong one. There are complaints that the system just doesn’t work. You hear whispers around the water cooler that “if only someone asked my opinion ahead of time, it would have been better.” People tell you that things are missing that you never knew were wanted. The vendor keeps asking for more and more money. The solution is slow and frustrating to use. People challenge how the decision to buy this solution was made. It seemed to take forever to come to a buying decision. The cost was much higher than expected. Buying IT is a difficult task. It is even more difficult to tell if it is being done well. You may have made a purchase, but how do you know you made the right choice?

6. Info-Tech Research Group6 Poor procurement can hurt the company far more than just a few misspent dollars. Avoid suffering these consequences A poor procurement process is hurting your business if: Users become frustrated and unproductive Employees are wasting time finding workarounds to tasks that the system cannot do The system is always being “fixed” Budgets are overrun The system took so long to buy that the competitive opportunity is lost Money was wasted on items that were not needed The procurement could fail to pass audit “ Doing it [IT procurement] right can add value; doing it wrong can destroy value. ” - Julie Sullivan, Partner, Advisory, KPMG If you have noticed some of the signs of a poor procurement process, assess if the situation is simply a misperception, an annoyance, or a real problem that requires intervention.

7. Info-Tech Research Group7 Demonstrate continuous improvement and value by measuring what you do. Measure your procurement to study results – set a baseline Measuring the performance of a procurement is not an easy task. There are very few industry standard metrics to measure the procurement process and it is hard to directly and exclusively attribute the success of a procurement to the procurement process itself. Start measuring, even if it’s imperfect. Info-Tech recommends selecting two or three of the metrics below to establish a baseline and to measure the progress and improvement of your procurement process. Pick two metrics (Info-Tech recommends the first two) and measure how you are doing today – compare these metrics against how well you do at the end of this blueprint. MetricMeasureHow to Measure End-user satisfactionSatisfaction ratingConduct satisfaction survey Compliance to processNumber of deviationsCount number of exceptions to procurement process Administrative cost of procurementDollarsAccount for time and resources Deviation from budgetPercentageCompare actual vs. budgeted Qualitynumber of defects / workarounds Compare solution against functionality requested Time to acquisitionDaysCount from request to vendor selection Variance in vendor proposalsPrice and specificationCompare prices and solution offerings Missing functionalityChange requestsCount number during implementation

8. Info-Tech Research Group8 Government railed for wasting public money on overpriced IT projects due to reliance on “trusted” suppliers. Case Study: Process complacency leads to wasted money Industry: Source: Government The Guardian, “Government wasting public money on overpriced IT projects – MPs”Government wasting public money on overpriced IT projects – MPs The government was found to be spending up to ten times more than standard commercial rates for IT projects. This included expenditures for large projects but also for basic IT hardware, such as desktops, which averaged at $5,300 (as compared to a common price of $1,200). Situation The cause of the over- expenditures was found to be reliance on a small number of large suppliers, who had used their advantage as trusted, incumbent suppliers to gain excessive profits from the deals. The government should have modernized its procurement process and used a more competitive tender process to secure more cost-appropriate bids. Mistake The government has been embarrassed by this mismanagement and is being urged to improve its procurement process by reducing the size of contracts to let in smaller industry players. It also enhanced its vendor identification and notification strategies based on the new vendor options. If the above measures had been taken earlier, the government could have saved substantial costs and prevented this embarrassment. Results

9. Info-Tech Research Group9 The benefits of good procurement can be felt immediately and have a lasting impact. Reap the benefits of buying IT right Many people see good procurement as simply buying the items you need at a good price. This is difficult to do, and it over-simplifies the real benefits of good procurement. Good procurement can result in: Happy, productive users Appropriate system functionality Fair, transparent, and predictable pricing Minimal wastage Eliminated surprises Enhanced procurement process transparency and auditability Cost reduction Faster procurements

10. Info-Tech Research Group10 The sooner you start improving your procurement process, the earlier the business benefits from better decisions. Upgrade your standard procurement process by dynamically configuring each process step for the individual procurement Here’s where to focus your efforts: 1.Get prepared before you begin 2.Obtain and maintain engagement with your stakeholders 3.Ensure appropriate governance over the procurement process 4.Formalize and standardize your procurement process 5.Configure and optimize the procurement process for each unique procurement 6.Simplify and clarify your procurement documentation 7.Engage your vendors early 8.Improve your due diligence 9.Effectively gather and elicit requirements 10.Prioritize your requirements carefully 11.Be definitive about your evaluation criteria and process 12.Differentiate between sticker price and true cost 13.Solidify management buy-in 14.Measure your efforts and track your improvements First, do the right things, then do them right. Not all procurements will require that all steps of the process be executed the same way. This blueprint with its accompanying tools will help you decide which steps to execute, which to skip, and which to change – a key to procurement success!

11. Info-Tech Research Group11 How to use this blueprint Enroll in a GI for your project. Email guidedimplementations@infotech.com guidedimplementations@infotech.com Or call 1-888-670-8889 and ask for the GI Coordinator. We recommend that you supplement the Best-Practice Toolkit with a Guided Implementation. Guided Implementations are included in most advisory membership seats. Our expert analysts will provide telephone assistance to you and your team at key project milestones to review your materials, answer your questions, and explain our methodology. Info-Tech Research Group’s expert analysts will come onsite to help you work through our project methodology in a 2-5 day project accelerator workshop. We take you through every phase of the project and ensure that you have a road map in place to complete your project successfully. In some cases, we can even complete the project while we are onsite. Do-It-Yourself Best-Practice Toolkit OnsiteWorkshops Book your workshop now! Email workshopbooking@infotech.com to get started.workshopbooking@infotech.com Leverage each of the tools in this blueprint to complete the optimization of this project. Do-It-Yourself Implementation Use this Best-Practice Blueprint to help you complete your project. The slides in this Blueprint will walk you step-by-step through every phase of your project with supporting tools and templates ready for you to use. You can also use this Best-Practice Blueprint to facilitate your own project accelerator workshop within your organization using the workshop slides and facilitation instructions provided in the Appendix. Free Guided Implementation

12. Info-Tech Research Group12 Info-Tech Research Group Helps IT Professionals To: Sign up for free trial membership to get practical solutions for your IT challenges www.infotech.com Quickly get up to speed with new technologies Make the right technology purchasing decisions – fast Deliver critical IT projects, on time and within budget Manage business expectations Justify IT spending and prove the value of IT Train IT staff and effectively manage an IT department “Info-Tech helps me to be proactive instead of reactive – a cardinal rule in a stable and leading edge IT environment. - ARCS Commercial Mortgage Co., LP Toll Free: 1-888-670-8889