The Value Of Partnerships Xander Leijnse

1. The Value Of PartnershipsXander Leijnse The Customer Connection, Utrecht, April 2006

2. Background • Unisys “voice of the customer” project, UK – 2001 • 3rd party interviewed senior personnel from major accounts • ALL 68 respondents mentioned “partnership” in one way or another • Most RFP’s contain references to partnership

3. What then? • We found there was quite some “partnership confusion” • We had little real knowledge of what “partnership” means • Research indicated there is not much available to help understand and develop “partnership” • So we created PVM to address this opportunity

4. Partnership Elements Partnership Relationship Return On Investment Service Level Agreements Governance Tactical/Legal/Control

5. Preferred Partnership ModelEngine Metrics (Baseline)Partnership CharterPartner ActionsWorkshop ReportImproved Relations ReviewPartnership Definition Action Management Detailed ReportSuggested ActionsImproved Relations PVMAssessmentEngine Action Management Continuous Process Definition Workshop

6. Exit - Poor Partnership Poor to Good Partnership Partnering -Loyal World Class Partnership Declining Commencing Reasonable Average Financially sound, innovative In-depth Relationship 446 Current Benchmark Average World Class Target Gap 0 200 400 600 800 1000 PVM Benchmark

7. Company 2 Company 1 SMT versus coal face SMT SMT Coal face Coal face

8. One to One One to Many Many-to-Many Partnership size independent The more complex the relationships then the greater need for PVM

9. PVM Credentials • Academic credentials • Cranfield University • Manchester Business School • Unisys Customers - examples • Merrill Lynch Europe • Royal & Sun Alliance (Phoenix) • Lloyds of London • London Borough of Harrow • Unisys Partners - examples • Microsoft Belgium • Microsoft UK • EMC

10. Case Study - situation • Large Investment Bank • Unisys holds Outsourcing contract to deliver “managed services” (help desk, desk top support etc.) • 25.000 seats • Key reasons we won initial contract: • ROI • Solve IT problem • Success? • All SLA measures green • Customer unhappy! • Openly talking about leaving • Addressed through Partnership Value Model

11. Case Study – Mine field vs Mind meld • Unisys perception • We delivered operational excellence • Excellent governance system • Customer perception • Expectations not met • Not happy with performance • Question “What Partnership did we both expect/need?” • Strategic Value not understood • Whatever happened to importance of ROI? • Relationship Elements not at all addressed • Annual “do you love us” survey • Still - Customer / Supplier, not Partner / Partner • Tactical Elements over addressed • What is measured is being done

12. Level of Trust Win/win relationship Level of added value Level of shared objectives Long term commitment Equal share of risk and reward Resolution of challenges Sharing of knowledge and information Cultural fit Integration of partnership Financially profitable Joint control of services supplied Sufficient resources to ensure success Communication effectiveness Effectiveness of performance metrics Chances of failure of the partnership Dispute resolution process Individual roles within partnership Patience and tolerance Joint innovation and financial gain Areas to address in PVM

13. Benefits • Strategic Benefits • Definition of clear strategy that defines aims, objectives and long-term goals • An improved return on investment • Risk reduction • Joint innovation • Continual focus on business process improvement • Financial Benefits • Clear, measurable value for money benefits • Continual effort at cost reduction and/or value improvement • Working Together • Fewer crises • Trust • Better end to end communications • Continuity – people changes have less impact • Full, candid, frequent and open communication between all parties • Effective mechanism for dispute resolution • An exit strategy

14. And finally • Comments • Questions • Thank you