A multinational utility needed to transform its approach to IT services – making smarter sourcing decisions to minimise costs, and forge disruption-driving relationships.
The client, a multinational utility, was facing intensifying competition and wanted to identify the smartest IT services strategy for its international business – and make a disruption-free transition to new suppliers.
Three years ago, Coeus Consulting began work with the client to develop this strategy, and inform key sourcing decisions across the business, such as which services should be ‘built or bought’.
When contract renegotiation with the client’s incumbent Managed Communications Services (MCS) provider failed to deliver a satisfactory result, we helped the client put that new strategy into practice – embarking on a massive, mission-critical programme of cultural and technological change.
Transforming a mission-critical serviceFor an energy generator, distributor and retailer such as the client, stable, high-quality voice and video communications were essential – supporting everything from board-level strategic conversations to the operation and maintenance of distribution infrastructure, and the effective delivery of everyday customer service. Given this, ensuring a seamless MCS cutover was vital.
Transforming at scale
The client’s MCS solution had to support 60,000 users, and a successful supplier transition would mean changes to WAN, LAN, telephony and more across 1,300 sites.
Transforming across geographies
The client’s global business was spread across 11 key territories, each with a high degree of autonomy over their IT budgets, as well as different needs and local regulations.
Approach
Coeus’ first step was to create a strong business case of the various options the client faced. This business case demonstrated that, even in the least beneficial scenario, the client could expect to see a reduction in run-rates costs by going to the market – rather than the 16% increase it would face if it renewed with the incumbent.
We then designed and ran a collaborative tender process and helped to manage the subsequent service migration.
The programme’s objectives were as follows:
- Achieve substantial cost savings for client
- Increase the flexibility of its MCS contract
- Forge a truly strategic partnership with the chosen supplier
- Minimise disruption and risk during service migration
We designed a tender process that would encourage suppliers to engage with the client’s challenges and share their most innovative solutions. This meant leaving delivery models unprescribed, asking suppliers to share emerging solutions to be tested and refined; as well as providing regular feedback during evaluation and negotiation.
Over the course of 12 months, we developed all the required tender documentation and conducted a competitive tender process with numerous suppliers. We down listed to two; the incumbent and one new supplier, with the latter being chosen as it was the most attractive supplier from both a solution and commercial perspective.
Results
Coeus worked with the client to deliver a landmark deal, a smooth migration of services, and a crucial first step in the execution of the more flexible, cost-effective, innovation-focused sourcing strategy. Outcomes include:
- €80m in cost savings
The programme is set to deliver €80m in savings in just five years – smashing the initial cost savings objective. - Enhanced SLAs and a broader service catalogue
The client has access to 12 new and 45 enhanced SLAs, a broader service catalogue and improved lead times. - Best-in-class technologies
The collaborative, non-prescriptive nature of the tender process has led to an MCS solution based on cutting-edge technologies. - Increased flexibility
The new supplier agreement is based on a new, modular, benchmarkable structure, ensuring increased flexibility and simpler contract terms, redesigned to reflect the market for each service. - An ongoing, strategic partnership
The new supplier has committed to creating a Joint Innovation Council, an ‘Academy’ for managing and sharing client-specific knowledge, best practice exchange programmes and more. - A smooth migration of operations
The client’s operations haven’t missed a heartbeat - including service cutovers completed during the working day, with no loss in user productivity. - Delivering change through flexibility and experience
The Coeus teams’ extensive experience and understanding of how important flexibility truly is, has enabled them to take on extra responsibility and minimise the impact of unexpected change.
