The topic of cost savings is always hot – and one on which ROI or business value is often measured. When service providers talk about delivering business value, there is often the assumption that cost saving is the number one measurement of business value. This, however, is not always the case.
Here at Anglepoint, we have a unique approach when working with our customers. We understand that every business has different and often uncommon values upon which they define success and cost savings may not be the “be all, end all.”
This is the differentiator when Anglepoint is on-boarding our services or working with a customer. The very first step we take is to define key objectives and success criteria – only by doing this can we deliver real business value. It is also important to appreciate that this business value is subject to change and the value being delivered may pivot in response to multiple factors. Therefore, a regular review of business values is necessary.
What is business value?
Business value measures both quantifiable and immeasurable elements that define a business’ health or strength.
Each business will place value on different aspects that may include company growth, customer relationships and retention, brand and market share, or governance, risk, and compliance.
These values may vary across stakeholders. For example, sales teams put more value on customer relationships and finance than on company growth but, fundamentally, the business as a whole will have core values or concerns. The business value will be based on the overall trajectory of the business. For example, a business looking to be acquired will place the most importance upon profitability and its EBITDA, but a multinational household brand will place a much higher value on its reputation.
Why do values change?
As businesses change and grow, so too does the business value they focus on. When new leadership takes over, often there is a level of transformation as they embed new ideas and strategies for the company. This may very well require a change in tactics to achieve an end goal. An initial focus on immediate cost savings may switch to a drive on customer satisfaction and initiate more spend to retain business and play a longer cost savings game. The same may be the case following an investment in a business or an acquisition.
A well-established brand that has held a strong position in the market and focused on internal streamlining to improve productivity and innovation may suddenly find they are faced with new competition and therefore the value of the brand becomes a priority.
We saw this in the fight for pole position with tech giants. For years IBM led the industry. Their brand would have been the value on which the business was measured but the sudden emergence of Apple drove IBM down the list, requiring them to change tack and reevaluate what they saw as business value. They had to work out what their customers would want in the future and get rid of anything in their portfolio that didn’t sit in this new model. Their business value changed from a focus on brand to a focus on their portfolio and what would deliver growth – an ability to innovate.
What outcomes does your business need?
Before onboarding an ITAM service it is important to have a clear and defined understanding of what your business sees as true business value. This will require input from all stakeholders. Working with a composable business structure will allow your organization to come together and clarify these measurable and unmeasurable values. You might consider the following in these conversations:
What are the top 3 challenges that your business is facing?
This could be a risk from vendor audits due to poor visibility of your software estate, or a merger or acquisition that has brought new unknowns into the equation. The risk of a costly audit outcome can impact your business both financially and reputationally, leaving budgets off kilter and customers with concern as to the stability of your business. The well-documented and longstanding case where the US Navy made thousands of copies of 3D modeling software without purchasing licenses is an example of both financial and reputational impact. Despite the reduced fine following a drawn-out court case, the disruption lasted approximately eight years. Through better governance and visibility, could this have been avoided?
- Business goals and objectives
What does the roadmap for the business look like? Every business should have clear strategies for the next 3, 5 or 10 years and the entire organization must work together to drive toward these goals with one common aim, that is agreed and communicated to and through stakeholders. These objectives must have stakeholder support and all projects and initiatives must be aligned with these objectives. Here are some examples of core company aims:
- Design a business plan or transformation
- Sell the business or divest
- Grow through mergers or acquisitions
- Growth supported by investors or through increased sales
- Increase a portfolio of products or services
- Global expansion
- Increased brand awareness
- Improve delivery times and increase profit margins
- Improve customer retention and satisfaction
What are the KPIs that will define success? Which outcomes will be measured and how will they be measured? Some KPIs may be measured by facts and figures that are directly related to financial results, but some will have to be viewed in a more holistic fashion using customer, staff, or market feedback in CSATs or polls. However this is carried out, there needs to be a clear understanding and alignment on what ‘good’ looks like.
ITAM excellence delivered by Anglepoint is measured on business value
For an outsourced ITAM or SAM service’s outcomes to deliver real business value, first the business value must be defined with clear KPIs, deliverables and an agreed process of evaluation that can be communicated back to the stakeholders with reporting methodologies using a language that your business understands.
Anglepoint has been recognized as a Leader in the Gartner Magic Quadrant for 4 consecutive years now. If you would like to find out more about how our team of experts can work with your organization to define or understand what real business value looks like to your business and how our services can deliver on these required outcomes, get in touch today.