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Webinar Get Better Software Deals By Aligning Your Sourcing Strategy And Commercial Approach

Learn how to align your sourcing strategy and commercial approach to secure better deals and supplier relationships with Forrester's Strategic Software Sourcing Playbook.

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Webinar Get Better Software Deals By Aligning Your Sourcing Strategy And Commercial Approach

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  1. WebinarGet Better Software Deals By Aligning Your Sourcing Strategy And Commercial Approach Introducing Forrester’s Strategic Software Sourcing Playbook Duncan Jones, Vice President, Principal Analyst February 28, 2013. Call in at 10:55 a.m. Eastern time

  2. Agenda • Software sourcing executives need a new approach for the new world of BT • Strategic software sourcing delivers better supplier relationships • Create this alignment using Forrester’s discover, plan, act, and optimize process

  3. CIOs need to cut costs in order to free budget for vital initiatives Source: December 21, 2012, “2013 IT Budget Planning Guide For CIOs” Forrester report

  4. Get used to living under the Technoligopoly Their scale enables them to drive huge technology innovation. They have insatiable appetites for revenue, to maintain their stock prices. Enterprises’ dependence on them gives them the upper hand in negotiations. A good sourcing strategy can help you ride the tiger without getting eaten.

  5. IT’s standardization has made us overdependent on our key providers AREAS UNDER DIRECT IT INFLUENCE SHOW GREATER DEGREES OF STANDARDIZATION Source: September 2009 Global State Of Enterprise Architecture Online Survey

  6. Misaligned commercial approaches cause procurement problems High prices

  7. Agenda • Software sourcing executives need a new approach for the new world of BT • Strategic software sourcing delivers better supplier relationships • Create this alignment using Forrester’s discover, plan, act, and optimize process

  8. Forrester’s strategic software sourcing model aligns procurement with the IT strategy

  9. Vendor management drives most tiering systems

  10. Use formal supplier tiering to drive future sourcing decisions Benefits e.g., executive access Obligations e.g., fair commercial treatment

  11. Define each tier’s benefits and obligations

  12. Forrester’s model measures five attributes Don’t call a supplier “strategic” just because you’re dependent on it.

  13. Supplier assessment — trust

  14. Review your current strategy for each category

  15. What happens now, in practice?

  16. Use a software category taxonomy to analyze your spend How much do you spend ? Spread across how many products? Source: January 3, 2013, “Global Tech Market Outlook 2013 To 2014” Forrester report

  17. Refine your strategies based on analysis of each category ImportanceTactical Strategic ERP ePurchasing Database CRM ServerOS HR Email Standardization Business fit Synergy

  18. Where do the supplier’s products fit with your strategy

  19. Category strategy example, Oracle in public sector KEY PRODUCTS FOR SMART CITIES • Case Management for Government • Oracle Policy Automation for Public Sector • Business Intelligence • Financial Management • Human Capital Management • Oracle WebCenter Suite 11g • Oracle Data Integration Suite 11g • Oracle Universal Content Management • Oracle WebLogic Suite 11g • Oracle Transaction Processing Server • Oracle Spatial • Oracle Database 11g

  20. Identify which are sole source and which are one of many ImportanceTactical Strategic Casemanagement Finance Database App server BI HR Standardization Business fit Synergy

  21. Review your current strategy for each category

  22. Pick the appropriate type of enterprisewide commercial agreement

  23. Agenda • Software sourcing executives need a new approach for the new world of BT • Strategic software sourcing delivers better supplier relationships • Create this alignment using Forrester’s discover, plan, act, and optimize process

  24. Find out more from our playbook

  25. How strategic is your software sourcing? Do you know your preferred sources of new technology And on whom you are already overdependent? Do you have category strategies, based on thorough analysis? Or is every purchase an ad hoc decision? Do you know what you will buy this year from your main software suppliers? Or will you have to react quickly to meet unexpected needs? If your CEO had a meeting with a supplier’s top exec, what would you ask him to get? And what would the supplier want in return?

  26. Switch from reactive procurement to strategic sourcing If you’re further along Split your tiering, to consider present and future separately. Review and update your category strategies. Work with one top-tier supplier to build a robust long-term agreement. If you’re just starting out Find out and document how you source each category, in practice. Develop a formal forward-looking tiering structure. Pick one supplier, and renegotiate all its agreements to align better with your strategy.

  27. Duncan Jones djones@forrester.com

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