A large media company was entering into a sole source outsourcing agreement with a leading service provider for Finance & Accounting services. The client was comfortable with the service provider in terms of experience and qualifications but felt the need to get a third party’s perspective on the proposal and its relationship to the market. The scope of the assessment was pricing, solution, transition, service levels and the commercial model.
Imagining IT Differently
ISG assisted the client with being able to recommend the sole source proposed contract to the Board of Directors with confidence. By comparing the proposed rates for the service by resource level and location, ISG was able to point out areas where normalized (based on location, service levels requested, resource mix, and skills) rates were within market pricing and a few areas where the client would be paying a premium. Because the normalization was transparent, the client was able to determine if they were willing to accept a premium for example because the management team were a higher level and onshore. The assessment covered market-based pricing, service levels, transition, critical deliverables, and commercial principles such as committed productivity.
Future Made Possible
- The client benefitted from ISG’s deep expertise in developing solutions for Finance & Accounting
- ISG and the client achieved a market based, sustainable contract in a three-month timeframe
- The Agreement covered services delivered from India, China, Eastern Europe and Central America
- By understanding specifically where there were opportunities for improvement, the client was able to avoid an “across the board” reduction request making the agreement much more equitable for both parties.