Introduction:

This case study summarises our role in helping a leading UK hospitality company to see a more significant opportunity to reduce costs and improve network services across the group.

Focusing on the evaluation of an unsolicited renewal proposal, we were able to quickly help the client analyse and negotiate an improved deal while also conducting a broader spending analysis to help them more fully understand it in the context of broader opportunities in their total network services spend.

The case study shows how our focus can help clients quickly understand their options in the broader context.

The Client's Challenge:

The client had a heavy change agenda including a significant focus on cost-reduction and had already engaged a strategic sourcing consultancy with expertise in their industry to scrutinise opportunities across their spending categories.

In that context, the unsolicited and time-bound proposal by an incumbent to renew the existing outsourced network services deal wasn’t initially a priority given (a) the minimal benefit offered and (b) the greater investment and disruption a more substantial switch or transformation would represent.

Our Approach:

We were engaged by their strategic sourcing advisors to help the client accelerate their consideration of the proposal, and negotiate an improved offer that would either meet their minimum hurdle for renewal or trigger a competitive process.

Our support was brisk, with key activities that included:

• A rapid 360-degree review of the services, performance and relationship

• Market comparison and analysis of the proposed renewal offer and its implications

• Leading deal negotiations seeking to improve the incumbent’s offer

• A broader spending analysis of the client’s total networking spend

• Formulation and presentation of final comparisons and recommendations

The Result:

The outcomes were:

• The requested analysis was delivered on time and within the allocated budget

• An improved offer from the incumbent that doubled offered savings, but fell slightly short of the CIO's target for a sole source

• A broader analysis of the proposal and comparisons against the client’s total spend that highlighted the more dramatic savings opportunities presented by (a) a competitive process and (b) increasing its scope to rationalise network spending across the group

• This led to the initiation of a competitive process to consolidate the entire network category. The client, by embracing this approach, realised substantial improvements and achieved a greater percentage of savings across the entire category

• As a result, the client initiated a competitive process that ultimately yielded much more substantial savings across the category for the group as a whole

Tags:

#Hospitality, #DealAssurance, #Benchmarking, #CostReduction, #Negotiation