Is your ‘Intelligent Supplier’ a Service Area Domain Expert? (Series: 8 of 9)
Byon January 23, 2018
This is the penultimate paper in our series of articles on the ‘intelligent supplier’. We have aimed to provide you with insights into the traits of these supplier organisations so you can assess whether your strategic partners have what it takes to drive success in complex service delivery. The final article is a summary of all that we’ve discussed over the last few months; it will be a reference article for you to look back on should you ever need guidance.
We have already covered Understanding, supporting (and challenging) the Client’s Business and Operating Strategy, Supporting the Client’s (often changing) Business Objectives, Evidencing ‘Commercial Trust’, being a Constructive Critical Friend, Managing the Innovation Process, response to Contract Terms Reshaping and Development, and the Client Engagement Function. But today we shall be focusing on Service Area Domain Expertise.
What is Service Area Domain Expertise?
Service Area Domain Expertise is focused on whether the supplier can evidence, from the results it has achieved with other clients, that it has deep domain expertise for the technical services it operates and that it can achieve meaningful results for you.
In the most successful strategic service delivery relationships that we have been a part of and independently reviewed, a consistent entry in the top three most popular reasons for a client choosing their preferred supplier was the specialist technical domain expertise the supplier represented it had in the service areas the client wanted it to deliver on. And, while a good indicator of a quality supplier, there is an issue with the ease with which some less scrupulous suppliers could manipulate this to tell a good story.
Less than ‘intelligent’ suppliers can even confuse ‘domain expertise’ with ‘warm body that we have on the bench’, and that can be misleading. Outsourced service delivery usually has very sensitive (read: low) operating margins; therefore, there is little room for operating and/or financial error. This is why in transactional processing service delivery, suppliers have learned to develop good methods, processes and proven IT systems with effective workflow which can ‘dumb down’ the requirements for ‘domain expertise’, maximising the way some projects can be run, for want of a better way of describing it, on autopilot. This does not show domain expertise, it simply shows consistency when the parameters are set from the outset and repeated on similar projects.
However, in more strategic areas of managed or shared services such as transformational IT, transforming strategic procurement, financial support services and so forth, the ‘dumbing down’ through methods and process has its limits. There is an oft-quoted phrase that ‘if you pay peanuts, you get monkeys’. To some extent, this is true. However, effective escalation processes within the larger service delivery operators means that their systems (if used) often provide a fast way of mobilising top-quality technical resources in either a fire-fighting/remedy capacity, or on a more controlled basis of being a strategic contributor to new innovations and methods of effectively fast mobilisation. These ‘burst-periods’, which need excellent and high-quality technical resources for just a short time, can alleviate key resource or problem issues very quickly.
It’s important, therefore, that in any technical assessment of working with a supplier for the first time (say during a procurement exercise), or in the ongoing reshaping of existing service delivery, that the supplier should be actively encouraging you to speak with its other clients to knowledge share and to take the lessons learned of the ideas they have collaborated with the Intelligent Client Team for innovating, piloting and implementing into BAU.
Why is this important and who benefits?
The simple answer is ‘all concerned’. An intelligent supplier that provides the foundations of building commercial trust with a client is more likely to build closer ties with that client in the long term. The client, seeing evidence of domain expertise is then encouraged to open up additional commercial opportunities where both parties can benefit.
The supplier and client work on new innovative projects together, driving greater cost savings across BAU services while improving the supplier’s operating margins and cash flow.
Service Area Domain Expertise is determined by a supplier’s ability to handle the unexpected, to think strategically, to mobilise resources as and when needed, and to formulate solutions, no matter the challenge at hand. You will recognise the need for several of the other elements of an intelligent supplier to be at work here as well for the supplier to be the type of organisation capable and willing to do this for its clients. And that is the reason why we say that not one of the elements discussed in our intelligent supplier series can possibly work on its own. All these elements, drawn together to develop the right behaviours, environments, capacities and attitudes, are what create the potential for a truly valuable strategic partner.
The next article in this series will be the last, the summary of all that has come before, taking a cross-article view of all the elements we have been focusing on and why each is so important to you and your strategic relationships. But, if you would like a recap on the articles we have already published in this series before reading the next, click on the links below:
- 8 core elements to assess whether your supplier is an ‘Intelligent Supplier’: Article 1 of 9 – Understanding, supporting (and challenging) the Client’s Business and Operating Strategy
- 8 core elements to assess whether your supplier is an ‘Intelligent Supplier’: Article 2 of 9 – Supporting the Client’s (often changing) business objectives
- 8 core elements to assess whether your supplier is an ‘Intelligent Supplier’: Article 3 of 9 – Evidencing ‘Commercial Trust’
- 8 core elements to assess whether your supplier is an ‘Intelligent Supplier’: Article 4 of 9 – Constructive Critical Friend
- 8 core elements to assess whether your supplier is an ‘Intelligent Supplier’: Article 5 of 9 – Managing the Innovation Process
- 8 core elements to assess whether your supplier is an ‘Intelligent Supplier’: Article 6 of 9 – Contract Terms Re-Shaping and Development
- 8 core elements to assess whether your supplier is an ‘Intelligent Supplier’: Article 7 of 9 – The Client Engagement Function