Badhrinath Kannan

Value and budget adherence are not the same thing. We had a client who wanted us to deliver a project that would result in $6M cost savings at a budget of $1M. But as we executed this, we recognized that there were larger opportunities to save over $20M, but with a likely budget of $2M. This is because we did not go overboard trying to stick to budget and took an exploratory attitude. Eventually it cost them $2.2M (10% over budget), but the savings accrued ended up close to $30M. It is important not to miss the forest for the trees.

Consistently dig deeper and learn. Are your services making a genuine difference to the client? Do your clients recognise this? Have you been expanding your knowledge of the client’s businesses, goals and what they value in a partner? Have you been using this knowledge to enhance the value delivered to the client? Can this be expressed in terms of measurable value? Do you have a way to clearly articulate this value? This can be done with surveys, meetings etc. but at the core is always the abiding passion to keep challenging the status quo and improving for the client. If these are not done, then you have a serious risk of being replaced by either someone with better relationship or lower cost.

It is important to express your service offerings in terms of KPIs that are relevant to enhancing the competitiveness and operational efficiency of clients. For example it is not simply about “managed cloud services” executed to meet some defined SLA - it is about how you can (for example) uniquely combine FinOps, Cloud security, DataOps and Site Reliability to help the client drive down compute costs, keep pace with emerging technology, empower their engineering teams and facilitate a faster pace of change. Pricing is another area seeing innovation - with risk-reward models beyond unit pricing becoming the norm.

Context is key. The era of generic managed services models is drawing to a close. Clients are increasingly looking deeper into what you bring beyond simply a price competitive "Keeping The Lights On" and "Operate a Service Catalog” offering. Todays value proposition increasingly speaks to how through your managed service you will free up resources to drive their digital business and how your offering will keep pace with new demand as clients execute their digital roadmaps. This demands knowledge of the operating domain, strong engineering depth within teams and understanding of how a client’s value stream operates.

Invest in the right infrastructure to allow experimentation and change without impacting ongoing business activity. A Digital Business Platform empowers small, creative teams to explore solutions and iterate rapidly can accelerate this. Depending on context, this could mean anything from low-code platforms, drag-and-drop data pipelines and self-service analytics etc. The goal is to allow these teams to see and show results rapidly and learn every day.

Tangibility helps drive stakeholder alignment. People return to their day jobs (with attendant pressures, deadlines and boss-needs) after workshops. How do we help stakeholders internalize the change early and continuously? Giving a tangible flavor of what to expect helps. For example, if getting rid of excel sheets for business decisions is a key part of IT strategy, rapidly prototype what it could look like early and allow stakeholders to interact within the “new reality”. This helps internalize change and create evangelists. Other aspects such as moving the data to cloud, ensuring governance etc. is more IT heavy work but too much focus on this will impact adoption and drag down pace of change.