Developing Your Strategic Partnership for Long-Term Growth 

Presented 

By

Earl Holland

President, Growth Strategy Consultants, LLC

August 17, 2017

Government Technology Services Coalition Capacity Planning Day

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The New Paradigm Called Collaboration

The Changing Landscape of The Government Contracting Market

The What, The Why and the How

Succeeding Through Strategic Alliances

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Shrinking Budget Facts

�  Congress' recent tax-and-spending spree and its intent on fulfilling a political promise will have to propose far deeper cuts to domestic programs to bring the government's deteriorating balance sheet back into the black.

�  Procurement executives are looking to provide greater value to the enterprise beyond cost reductions but, markets can only offer so many savings using traditional ‘strategic sourcing’ methodologies. So, their focus from price reduction has gone towards TCO reduction and spend reduction .  Firms must get more “bang for the buck” (measured by broader business outcomes) as opposed to just reducing expenditures.

�  Safely harnessing supply-market power to create competitive advantage is the

mission of a world-class procurement organization.

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Shrinking Budget Facts �  The primary vehicle for extracting value from the supply base has been the

strategic sourcing methodologies pioneered in the 1980s and 1990s. �  Sourcing managers used it successfully to rationalize suppliers, aggregate buying

power, drive down pricing and even improve supplier performance against a contract. Strategic sourcing also proved invaluable during the recent recession to recalibrate pricing to the supply markets when they took a nosedive alongside demand markets.

�  62% of Federal Managers report personal experience with tighter budgets �  19% believe that their budgets in 2018 will be even much lower than 2017 �  12% of respondents describe the impact of budget cuts to be devastating and

58% believe that they will be significant to the agency’s mission performance.

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Fiscal 2018 Likely to Start Under CR; Positioning In Q4 2017 Can Help in Q1 2018

�  Fight over next year’s budget will yield a continuing resolution to start the year

�  CR would freeze fiscal 2018 obligations at “current rate” to start the year; this will prevent any new starts

�  Positioning for fiscal 2018 first quarter under CR will be tricky steps to explore unless you have already started your preparation of identifying your strategic partners for collaboration

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Change Forward Thinking �  Mind Set �  Vision �  Strategy �  Business Model �  Increase Capacity �  Sustain Revenue �  Trust

�  Strategic Alliance �  Larger Procurements �  Collaboration �  Partner Integration �  Co-Presenting/Marketing �  Increase Revenue �  More Trust

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So What do We Do To Stay In The Game �  Plan-by performing in-depth internal assessment of your company and an

external assessment of your potential alliance partner(s). ü Who are you ü What do you really want to do ü Focus on how you will leverage your core skill set ü Do your market research to determine how your core skill sets support the

mission of the agencies your interested in supporting ü  Identify and establish your alliance value proposition with your selected

partners �  Prepare �  Position �  Partner �  Pursue

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So What do We Do To Stay In The Game

�  Prepare-by developing a compelling story base on your research, knowledge and understanding of the agency mission and your ability to assist them in overcoming their challenges in accomplishing the mission. “Make Their Mission Yours”

Ø Respond to RFI’s

Ø Sources Sought

Ø Make sure you highlight your “differentiators” when responding

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So What do We Do To Stay In The Game

�  Position-use your research to position yourself as a Solutions

Expert (SE’s) in the areas they are challenged in. This can be demonstrated in how you tell your story in response to their RFI’s and Sources Sought Ø If you don’t know the customer/make sure the customer knows

you

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So What do We Do To Stay In The Game

�  Partner-this is the business model of today. Companies can’t afford to go at it alone based on the characteristics of the current market

Ø Partner selection must be based on comprehensive “due diligence”

and supported by a structured “best practice” methodology Ø A through understanding of the Architecture of Strategic Alliances Ø Validation of chemistry fit, strategic fit, cultural fit, vision, objectives,

goals, integrity, and trust to substantiate compatibility

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So What do We Do To Stay In The Game

�  Pursue-going to market should be pursued with passion, skills and confidence that your alliance is by far the best entity to solve the challenges of the customers you pursue. Ø Story Ø Perspective Ø  Past performance Ø Patience

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Government partnerships include all the Phases in the Alliance Framework

Phase 2 Analysis & Selection

Phase 3 Building Trust & Value Creating Negotiations

Phase 4 Operational Planning

Phase 5 Alliance Structure & Governance

Phase 6 Launching & Managing

Phase 1 Alliance-Specific Strategy

Phase 7 Transform Innovate or Exit Gracefully

(Source: The ASAP Handbook of Alliance Management: A Practitioner’s Guide)

Alliance Framework Manage Knowledge and Relationships

2014 ASAP Global Alliance Summit

Corporate Objectives

Corporate Vision & Mission

Alliance Objectives

Partner Selection

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Selection Factors

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Thy Self Assessment

Internal/External

Thy Mate Assessment

Internal/External

Thy Market Assessment

Internal/External

Self Mate Self Mate Self Mate

•  GAPS

•  Strength •  Weakness

•  Process

•  Management Style •  Vision •  Goals

•  Value Proposition

DNA DNA DNA DNA DNA DNA DNA DNA

•  Processes

•  Culture

•  Management Style

•  Philosophy

•  Core Values

•  Market Characteristics

•  Market Leader

•  Goals

•  Customers

•  Revenue Objectives •  Financial

Partner Selection Continued

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StrategicSourcingvsCategoryManagement

   

Goal Achieve savings: implement specific Maximize value for spend: reduce total strategies around spend and vendor cost of ownership (TCO), generate consolidation, standardization of supply chain-wide savings, reduce risks, requirements and specifications, and improve supplier and operational price benchmarking and negotiation performance, and boost innovation

  Small business: Meet or exceed small Small business: Meet or exceed small business goals

business goals

Frequency Project driven: initiated once in three to Continuous: ongoing series of projects five years based on internal demand or identified and prioritized based on supply market changes regular analysis and reporting

Methodology Standard methodology: typically Broad framework: ongoing cycle of based on a seven- to nine-step establishing baseline and goals, methodology starting with assessment developing a strategy for category and ending with vendor selection and improvement, project execution, and implementation

performance management

Value Sourcing savings: annual savings Value for spend: achievement of through planned demand reduction and strategic objectives, including spend average purchase price reduction, under management, price savings, TCO tracked through finance and sourcing savings, improved supplier performance, systems innovation, and user satisfaction

 

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Category Management Overview

Category Management Overview  

Current to Future State of Federal Government Purchasing  

Current State of Purchasing: Future State of Purchasing: Lack of Coordination across agencies Synchronized procurement across government

Duplicated efforts Industry involvement in delivering best category strategies Many agencies no leveraged buying power One common management framework

 

 

 

 

 

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Benefits of Collaboration Partnerships

Collaboration ‘Racing for the world’

Building Critical Mass Reaching New Markets Plugging Skills Gaps

Creating New Opportunities Building

Nodal Positions in Coalitions

Building New Competence

Partner ‘Racing for the future’

Gaining Competitive

Strength through Co-option

Gaining Competence through Internalized Learning

Leveraging Co-specialized

Resources

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GTSC Capacity Planning Day

Thank You !!!!!

Earl S. Holland III President

Phone: 703-865-8346 Cell: 703-231-0593

Email: earl@growthstrategyconsultants.com

www: growthstrategyconsultants.com

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