Many people in outsourcing situations want to rush to the answer. Service Providers are anxious to know if they have won the deal, and the client is dying to know what the price will be. Plenty of other pressures encourage teams to rush through the early stages of the outsourcing transaction process. Sometimes, steps are skipped or compressed, sometimes decisions are deferred until “later” -- usually meaning “after the contract is signed”. This is certainly an easier and faster way to get through a transaction, and a tempting one. But like shortcutting the design and engineering of an automobile, you are likely to have lots of recalls, customer dissatisfaction, some accidents and bad press as a result.
Skimping on the initial processes of defining your objectives and requirements only pushes those activities out until the negotiations-- after you have received the pricing and eliminated the competition. When work that the internal team could have been done upfront is pushed into contract negotiations, expensive lawyers and consultants generally do a lot of the work. If you push the critical decisions and discussions until after the deal is signed, you are most likely looking at pricing increases, unmet service needs, and a serious disconnect between performance expectations and service delivery. Not doing an adequate job of understanding your strategy, and your current environment can set you up for buying the wrong set of services, too much or too little service, or choosing the wrong provider. And getting it wrong doesn't just result in headaches -- it can be a serious blow to the bottom line.
Here are a few things you should never omit when negotiating with a potential service provider:
Speed Sourcing – also known as Fast Track, Sourcing Lite, and various other monikers – is the latest talk in sourcing circles. In an attempt to address the downturn in the sourcing advisory business, consultancies have been attempting to find ways to "stay in the game". As advertised, it is a way to go from identifying service providers to contract in three to four months.