The detail

This global fashion retailer was undergoing an unprecedented level of change as part of aggressive growth plans for UK and international expansion. To support this vision, they were transforming their IT estate. They engaged us to renegotiate the SSP agreement between the retailer and their incumbent strategic partner.

Expanding into new territories can bring unprecedented levels of change, as this leading retailer was experiencing. So we helped them negotiate a new SSP contract (with a 40% saving against projected spend) to transform their IT real estate...

Outcome

New SSP contract that delivered 40% saving against projected spend.

Method

Negotiation workshops.

This fashion retailer was undergoing an unprecedented level of change as part of their aggressive expansion plans. To support this vision, they were transforming their IT estate by introducing new trading and ecommerce platforms. They required a new Strategic Support Partner (SSP) with the relevant experience to support them in this journey. Their current support agreement was about to expire, and major transformation projects were starting shortly after.

Why Elixirr?

We have in-depth experience of successfully negotiating with leading global professional services companies for very similar commercial deals. The retailer selected us for our insight and expertise regarding their very specific challenge.

The challenge

We were brought in to manage the renegotiation of a new global support agreement with one of their strategic partners, and to explore potential options to go to market.

The retailer and strategic partner had started the negotiations for a new SSP agreement earlier in the year, but still hadn’t reached a deal. There was a risk to project delivery and the achievement of wider business objectives if the SSP agreement was not in place before the major IT change programme started.

We needed to set up a negotiation process and act alongside them as the ‘deal team’ with one of their strategic partners during a period of exclusivity.

The approach

The project was built around three distinct phases: plan, negotiate and contract. During each phase, vendor performance was evaluated weekly to inform a Go/No Go decision.

Plan – we established a set of agreed deal principles between the retailer and the strategic partner to support a Go/No Go decision. These also formed the basis of more detailed negotiations.

Negotiate – we conducted a series of focused negotiation workshops. The outcome of these was documenting the commitments in a plain English Memorandum of Understanding (MoU).

Contract –  we led contracting workshops between all parties and respective legal counsel to accelerate the timelines.

The value

We enabled the successful renegotiation of the SSP agreement with their incumbent strategic partner, resulting in a substantial multi-million pound deal. The new agreement extracted significant value from a legacy agreement, delivering a high return on investment. The retailer saved around 40% in IT spend and received a much enhanced service model.

The new integrated support model covered both application and infrastructure support. It also included an improved approach to Project Services that delivers a consistent and high quality delivery model, supported by transparent and market competitive rates.

A service hub with dedicated resource from the Indian delivery centre was also introduced. The incumbent vendor now provides the retailer with holistic and proactive service reporting through investment in innovative tooling and automation. The improved governance model has executive sponsorship, and provides greater transparency and accountability across key areas of IT.

The agreement provided this retailer with greater transparency and value for money through improved commercial levers, including improvements to benchmarking and the introduction of market testing. The financial impact of the dual run period between legacy and new systems has been minimised to a period of 12 months, resulting in an uplift in Year 1 spend.

The praise

"I have been very impressed with the support, professionalism & results that Elixirr provided in the renegotiation of a global IT support contract."

Chief Information Officer