Optimising Performance & Saving €92M On Network & Communications Sourcing

The client, a global energy firm, found that it was facing a 16% increase in Network Services run costs just to stand still.

The temptation to simply remain with the incumbent provider was strong as services were generally stable and any change or transition would be potentially long and complex to implement.

However, pressure from the business to reduce cost and an awareness of emerging network and cloud managed communication technologies encouraged the client to explore transformative options from the market.

At the very least, the client wanted to keep its run costs at the same level. Ideally it wanted a strategic partner who would commit to helping it drive cost reduction and innovation.

Wavestone’s approach to contract negotiations ensure value for the customer on day one, as well as ensuring mutual benefits for both organisation to support long term service and commercial imperatives.

Working within an agreed timebox, with both the supplier and client, we helped to identify opportunities for the supplier to reduce their cost to serve and therefore their cost to the client.

It’s critical to timebox this investigations to ensure that the option of tendering their services is still available, thus creating leverage. Throughout the exercise, benefits were measured against the ‘go-to-market’ option.

In this case, the final recommendation and decision was to tender the services.

This was agreed as the approach would deliver, even in the worst-case outcome, a small improvement against current spend- something that was not achieved through negotiations with the incumbent.

We then supported the client through the process of going to market, new and innovative contract frameworks and transitioning to a new supplier to:

• Deliver cost savings
• Identify the best managed communications services solution for the client’s needs
• Forge a strategic, innovation-focused partnership with the chosen supplier, and
• Minimise any business disruption during the migration of the services.

The Wavestone approach provides the client with:

• TECHNOLOGY INNOVATION The solution brings widespread transformational improvement; Hybrid WAN introduced in  readiness for SD-WAN; network wide monitoring & security,  evolution to a Wireless First Strategy for WAN with next-gen wifi.
• ALIGNING DIVERSE REQUIREMENTS Stakeholders from 11 of the client’s territories were engaged from the start. This was critical to understanding the implications of local regulations & building an organisation-wide consensus on the final deal.
• ITERATIVE SELECTION PROCESS The Wavestone team helped the client to challenge vendors to share and test their innovative solutions, offering feedback and iterating on its its most promising ideas. This approach to sharing requirements and developing solutions, through iterative vendor workshops, ensured the right solution -at the right price – was achieved in an accelerated fashion compared with the RFI/RFP process.
• COLLABORATIVE ENVIRONMENT Wavestone helped foster an open collaborative culture between client and suppliers. This helped in early stages, ensuring the client was seen as serious about looking for a new vendor.  Wavestone also helped with the migration, working hard to bridge potential cultural and physical gaps between client and suppliers.

The project outcomes far exceeded expectations. All the projects objectives were met or exceeded, and the new deal delivers: