Monday, August 03, 2015

What do you do when post negotiation the offer is declined ?

Business teams wanted the solution badly as it gave them a capability that none of the competitors had. So they worked with the CIO to conduct a thorough analysis of the options available along with validation from an independent IT consultant who had no bias towards any solution provider. The final conclusion was no different from what the business had intuitively arrived at on their own. The excitement was palpable and everyone waited for the budgets to be defined and approved to get started with what would be a project of a lifetime.

The business head along worked along with the CIO to prepare a business case for implementation that was put forward for review by the Executive Management. Discussions turned into debate and ended with clarifications sought from the team on choice of technology and associated investment. Patiently the CIO, vendor, and the business head addressed all open issues to be given an approval of a much reduced budget to get started with. It was a stretch and a difficult ask; everyone knew that but decided to give it a shot.

The negotiation started in earnest with local vendor team who threw up their hands escalating to the regional office; the regional limit did not allow for the expectation from the customer. The local team did not give up as it was a high profile customer and the CIO had brought significant transformation; they knew if they won the business it would be a high visibility win. The defined scope was large and by virtue of this the order value even at a high discount would be worth the effort. So the negotiation was pushed to the global headquarters to manage.

Head of Global Sales arrived at the customer office to close the deal. He was hopeful that he should be able to close in a couple of days. Back and forth it went tugging from one end to the other each waiting for the other to bend, none willing to yield ground. He realized that the customer knew their position and were willing to wait it out to get what they wanted. In a typical world it was a huge discount which they had not done for a long time now. The war of wills had the business head pushing for closure citing business value loss with the delay.

With the Purchase head reporting to the CFO who was unwilling to come down from his high stance it appeared that there was no way out. The CIO was cognizant of the fact that there was business value to be captured which was well articulated and presented by the business head. He called the vendor CEO giving them an opening to break the deadlock and suggested the same to the CFO. The customer and vendor accepted the solution and everyone sighed with relief and shook hands bringing to an end the long drawn battle.

Everyone shook hands and the approval process was to complete in the next few weeks to get the Purchase Order released. Timelines were agreed to on the start of the project, resources were to be allotted from the global talent pool. Life unfortunately does not always play fair. With a twist in the story, in the elapsed time dynamics had changed; the Company had just finished the annual budgeting cycle and the project was about to spill over to the next year. The Executive Committee suggested a review of pending projects.

Left hand unaware of what right hand was doing ? Or did the project become a victim of circumstances ? Was it communication gap between the Executive Committee and the stakeholders ? The Business head was present in the meetings that discussed the company’s results and priorities. Or was it just a case of lackadaisical attitude from the Finance and Purchase team that left the Vendor, Business and IT high and dry ? Can Internal politics drive the investment agenda ? So what caused the project to be abandoned after the long drawn negotiation ?

The vendor did not know how to react to the situation which had taken huge time, effort and resources that now came to a naught. They received curt messages from the Company on the deferment; the vendor CEO reached out to his ally the business head and the CIO. Reality was indeed perplexing and to some extent juvenile with one person’s ego becoming larger than life. Vendors abandoned their quest for business from the company rather than be subject to similar treatment arbitrarily that lacked basic professionalism.

The company is slowly rolling back into the past !

1 comment:

  1. Fundu Arun. This particular process is agnostic of Business, Company and Industry.
    Keep going - all in my company look forward to your well articulated blogs - sharing the experience of yourself and others !