About Best Practice Group
Why we exist – the challenge
Large business process outsourcing relationships and complex enterprise software implementations are notoriously challenging to drive maximum value from. Misunderstandings, unrealised expectations and performance challenges are common place. Recent statistics from the major research houses all show that nearly 50% of major outsourcing relationships and large enterprise software implementations all fail to achieve the outcomes client organisations and their vendors expect. This means that money, resources and time are all severely compromised.
We ourselves have experienced this being sat in your seat being accountable for the results of strategic service providers. Prior to the formation of Best Practice Group (BPG), the founders went through personal litigation in their own respective organisations as a result of major vendors and service providers not delivering what they had promised. They went through 13 law firms, including those in the ‘Magic Circle’ to try and find redress. The founders realised that whilst law firms understand the technical and legal aspects of written contract terms, few really understand the operational, financial and staff impact on an organisation when the service and outcomes promised do not materialise. Often therefore, the written contracts do not reflect the behaviours and business outcomes you are trying to achieve. Often, contractually, the perception is that this leaves you without a ‘leg to stand on’.
As a result, most of the team studied contract law and used this to supplement their own extensive operational knowledge. In this they identified two key findings:
1. Expert responsibilities. When a vendor represents itself as a ‘specialist’ in its field, it has a number of ‘undocumented’ obligations to you in law. This means that even where such items as your vendor’s ‘duty to warn’ you about when potential understandings of your expectations might arise, are not documented in the contract, the vendor is still under an obligation to warn you about them. Most importantly, if they try to use the written contract terms to contract out of (exclude) those responsibilities, it is most likely any court of law would rule against them from being able to rely on these exclusions to your detriment if you have relied upon their specialist advice.
2. Individual’s behaviours over-ride the written contract terms. Lawyers acting for both you and the vendor often argue about the written contract terms as to who should have done what under the agreement. The courts however focus on what the individuals actually did. If you and your vendor(s) operated in a way that did not align with the written contract terms, then the manner in which you actually did operate will usually take precedence, give new meaning and over–ride the written contract terms.
Creating a ‘win-win’ partnership between you and your vendor(s)
So, in 2000, BPG was born. We realised that there had to be some way to join the dots between making sure that both clients (service users) and vendors can both achieve the business outcomes, objectives, profits, performance levels and customer/citizen satisfaction that works for all parties concerned. If this could be achieved, then the levels of commercial trust could be built that by necessity, are required to drive new innovations. In turn, this drives new ways of delivering services, increases your vendor’s margins and, importantly, significantly lowers your service user’s (clients) delivery costs. In other words, a commercially and value driven, but trusted ‘win-win’ partnership.
Everything we do is aligned to:
- Drive maximum value from Strategic Vendor partnerships and making them work.
- Train, coach and support your internal teams for you to build internal capability. In this way you reduce the medium and long term necessity and cost of using external advisers (such as BPG).
Three ways to drive maximum value
To drive maximum value in your strategic vendor relationships, we specialise in three areas:
1. New Strategic Vendor Relationships
When getting into new strategic vendor relationships, our ‘Accelerate’ methodology and processes are designed to help you:
- Improve service delivery and lower costs, fast (savings of 15%-35% p.a. are not unusual)
- Motivate vendors to innovate in service delivery
- Understand the ‘expert’ responsibilities of your vendor to ensure misunderstandings and unexpected costs are avoided
- Ensure the culture of the vendor aligns to getting you maximum value from your relationship
- Make sure your business outcomes are quantified and understood by your vendor (and avoiding internal disagreements).
2. Driving better value from existing Strategic Vendor Relationships
About half of our work is re-aligning strategic vendor relationships that are not achieving the business outcomes either the client or vendor anticipated at the outset of the relationship. We have a proven methodology and supporting processes that help you achieve the following:
- How to identify and quantify what ‘good looks like’ in a strategic vendor relationship
- Collaborate with you to identify your own specialist business outcomes and what has worked for other similar organisations
- Work with you to help identify what specific behaviours from your own team and that of the vendor that have contributed to poor value and how to address these quickly to rebuild both performance and trust
- Using the ‘expert responsibilities’ of strategic vendors to identify what obligations both you and your vendor are (or should be) accountable for
- How to re-align your relationship quickly, reduce on-going costs, improve service levels and re-build both trust and innovation to drive maximum value from your relationship
- Identify appropriate case study examples of what other organisations have undertaken to avoid terminating their poorly performing relationship; how services were reshaped, cash savings gained and relationships strengthened promoting a win win situation for both client and vendor.
3. Failed Strategic Vendor Relationships
There are situations where clients and vendors believe their relationship cannot be re-built. About 20% of our work is dealing with these situations. We are often called in by the lawyers from either side, or sometimes in a joint-expert-witness capacity to provide opinion and give evidence to the Courts about what went wrong in the relationship and the operational and financial consequences to the organisations as a result.
It’s not a pleasant situation; internal stakeholders will blame each other; external stakeholders will also blame the other. Usually, the result is extensive time-overruns, escalating costs and business outcomes that have failed to be achieved. We’ve written several blogs and white papers on the subject in the hope that organisations learn from others and do their best to avoid such situations in the first instance. In these situations, we support you in the following ways:
- How to self-diagnose whether you should really be terminating early, or giving the relationship ‘one more push’
- How some of the protection you thought you had in your written contract actually makes your situation worse; how to get around it
- Understanding the ‘unwritten’ contractual obligations all specialist vendors have and how they can be used to accelerate the termination, exit process, safely and at minimum cost
- Collaborate with you to identify how to shorten the time for a safe termination and exit
- What key actions make the termination process riskier; how to avoid them
- Case study examples of what other organisations have undertaken to terminate long term relationships early, and put themselves into a position to reduce costs, replace their vendor with one that worked much better leading to achieving their business outcomes in a much shorter time scale.
A Proven Track Record
The reputation we have achieved for helping you to drive maximum value from your strategic vendor relationships is based upon a proven track record of collaborative working between yourselves, your vendor and ourselves. With over 500 previous relationship successes, all of our clients can be fully referenced, with some examples of private sector references and some examples of public sector client references.