Adding an ISG advisor to a project team facilitates an efficient and cost-effective contract for this healthcare and pharmaceutical company.
Opportunity
In early 2014, this healthcare company engaged the market on its own to source the application maintenance and development for its SAP environment. It needed to replace a short-term agreement that ISG had helped structure in 2012. Although pricing indicated significant savings opportunities, the company-developed RFP led to high variability in the responses from service providers. This made it difficult for the project team to evaluate the proposals, articulate a clear down-select recommendation and get to signature with its preferred provider. An ISG director was engaged and embedded in the team to help quickly bolster it and provide subject-matter expertise and project leadership.
Imagining IT Differently
In three weeks, ISG developed a complete service description based on market best practices. The description included significant improvements in multi-vendor cooperation and proactive maintenance as well as significant leverage of knowledge management and "shift left“ ideas.
After leading the team through a down-select process, the ISG advisor completed a set of sourcing agreement documents and led the company through the final negotiation. The advisor’s experience led the company to signature-ready contract documents within 60 days of engagement.
Future Made Possible
- The company was able to realize significant savings. Though it had hoped for $5 million in savings, with ISG’s help, it obtained $17.4 million in savings – more than triple its original goal.
- The company also was able to implement modular or component-based pricing to facilitate potential future XaaS replacements of ERP modules.
