1. “Going out to market is a big job, or commits us to switching suppliers”
Market tendering doesn’t force you to change – it’s intel gathering, of the latest solutions and costs.
The right support makes it an easy process, and then you’re equipped to make the best decision.
2. “The lawyers will sort the contract”
There are around 90 points in a typical IT / telecoms contracts, but only around half of these are legal terms.
Lawyers naturally focus on the legalese, rather than the service and commercial terms.
But it’s these service and commercial terms that impact how well the service operates. These vary by technology type e.g. a SaaS deal is quite different to a mobile phones deal.
3. “Just run the RFP as part of your day job”
An RFP demands market experience, some intense periods of work and then some ongoing tasks.
Whilst many companies do DIY it, the IT services they are buying are often expensive and critical.
It makes sense to engage the right help – few people buy a house without a solicitor!
4. “Let’s just meet the bidders, avoid procurement slowing things down with paperwork”
This starts well, but always grinds to a halt later.
Typical drawbacks are supplier offerings that can’t be compared to each other, or vague requirements that take twice as much time later on.
Worst of all is an exasperated business that’s then forced into a knee jerk choice!
The right degree of sourcing process is not onerous, and will give you:-
i.) harmony & internal agreement on what you want as a business beforehand
ii.) easier comparison of vendor offerings – objectivity on quality AND cost
iii.) no surprises on pricing, plus a contract that’s both fair and fit for operations
5. “We’re too small to negotiate, or to change the suppliers contract”
A total myth.
We have never found a supplier that refuses to negotiate, regardless of their size.
However their account managers and PR like to spread this myth…
6. The “early favourite” bidder
This is human nature, and happens on around half of our RFP projects.
There are many reasons why, but once all the bids are objectively assessed, often they fall by the way side.
The client then dodges a bullet, and chooses the best solution based on all the important factors.
7. “We need the system deployed quickly, so we have to choose faster”
If the system is important, what’s the benefit of some upfront time to choose well?
Rushed choices, perhaps deciding based only on certain bits of functionality, or from a limited number of supplier bids, often lead to big delays later, during implementation or after go live.
For a system that’s likely to be with you for many years, it’s worth running a good selection process.
8. “We’ll beat them up on price, the rest of the contract is admin detail”
There are typically 30 to 50 ‘configuration’ points within a technology contract.
Upfront price is only a few of them. The others will effect what you pay when things change, for under performance, for exit, and a range of risk exposure points.
Vendors may concede on some upfront items, but quietly win on these other points, which count for more later on.
9. “I trust my existing supplier, no need to tender” (or worried an RFP will damage the relationship)
Over time you may be paying more, as prices get lower and new solutions emerge.
You can never be confident of getting fair market prices, despite supplier assurances around corporate discounts, special deals, bonuses for not tendering etc.
Some suppliers prefer this approach as it avoids competition and effort on their part. Competition is healthy and ensures you stay on a fair deal.
10. “IT staff will do the Vendor Management”
We find technical staff are rarely enthused by this housekeeping / commercial type work!
Whilst only a small amount of regular work, it’s key to maintaining good performance from all your suppliers.
It saves you money, keeps you in better control and helps you align with ITIL v3.0 best practice.