3 Strategies to Elevate Your Software Supplier Relationship

Over the years, our TNG client family has requested more and more guidance related to managing and elevating their commercial supplier relationships. Within this article, you’ll find our top 3 proven strategies to transform IT supplier relationships from tactical to strategic.

Strategy #1 – Control the Flow

When we say “control the flow”, we’re referring to conversation, meeting, and engagement flow.

When prospective clients reach out to TNG, they almost always have the complaint that the supplier knows more about the “needs” of their organization than they do. This most typically is due to the internal lack of time and/or resources to focus on a specific supplier or digital capability. On the other hand, the supplier’s sales team is laser focused on opportunities to grow their business inside of your organization. Immediately, this creates an unfair environment for all parties involved.

You may be thinking that this only creates an unfair advantage for you, the customer. Well, in most situations that’s true. However, it should also be noted that in some circumstances, the supplier’s sales team may be operating with good intentions and simply answering your internal stakeholder’s demand for attention. In short, when one side knows more than the other, it creates an uncomfortable situation for at least one party.

As our team brings 100+ years of collective experience, we have seen just about everything. Most of TNG’s clients are very well-established companies that have $5 billion+ in annual revenue. These companies typically have a “center of excellence (COE)” and/or a “software asset management (SAM)” team. While the overall intent is good, we typically see only about 10% of our clients leveraging these teams of resources correctly.

What happens to the other 90%? Well, one of the most classic inside sales techniques is for a supplier’s sales team member to establish, chair, and/or participate in a COE with a specific focus on their software and its many digital capabilities. This type of group typically meets either monthly or quarterly and is sold as a way in which the sales team member can “inform” the COE/SAM team members of the “demand” coming from inside of the organization. The reality is that the “demand” is often created by the sales team member who has been pushing a land-and-expand strategy inside of the organization.

The easiest way to not only level the playing field with your software suppliers, but also elevate the relationship from tactical to strategic, is to set up strict governance around the overall engagement. Every supplier engagement is slightly unique, but we recommend focusing on the following core tenants:

Focus your efforts on your Top 10 software suppliers.
Develop a steering team of executive IT leaders that are in control of the Digital Capability strategy for your company.
Develop an internal COE for each of your Top 10 suppliers. The size and scope of them should proportionally match the importance of the supplier’s impact on your business.
Identify and assign clear roles & responsibilities for each employee team member that is part of their performance objectives.
Do not allow supplier sales team members to be a member of the core team but rather serve as an invited guest on a routine cadence.

This is about the time where traditional sales team members will indicate that this approach will slow down process, innovation, growth, etc. The reality is quite the opposite when properly set up and managed. The primary outcomes you want to achieve are the following:

Shift the communication paradigm from outside-in to inside-out. This allows the company to ideate, contemplate, and organically socialize a software roadmap (vs. constantly asking the supplier for a list of their asset inventory).
Share information with suppliers only when it has been fully vetted and approved as a sanctioned project or approved proof of concept. If done properly, this drastically decreases the chance of duplicate purchasing, split requirements, and/or random unwarranted proof of concepts (that usually turn into shelfware) around the enterprise.
Allow everyone to be more efficient and structured with their time by eliminating the need for follow-up meetings, etc. In other words, engaging suppliers only after decisions have been made internally by the COE will enable the COE to be treated as a true authoritative entity vs a “check the box” exercise.
Provide opportunities for suppliers to suggest innovative solutions in a fully committed environment.

We find that our TNG clients save an average of 26% annually by deploying this strategy alone (with our help, of course).

Strategy #2 – Manage Upwards

Anyone who knows the basics of selling understands that the easiest way to make a sale is to identify and influence the decision-maker directly. For large enterprise sales teams who are managing multi-million-dollar contracts, that decision-maker is very often an executive leader within the company. Far too often, we find that organizations provide unfettered access to executives without reason. This, in short, usually enables a very unhealthy and complacent comfort for the supplier sales team that (if not properly managed) rarely produces intrinsic value for the company.

By far one of the most effective ways to elevate your supplier relationship is to set up strategic business discussions between company and supplier executives. The key here is to establish equal representation on both sides and ensure there is proper attention and respect established between both companies. Access to your company’s executives should largely be restricted to these meetings which, where possible, should be set up by the COE/SAM teams mentioned in Strategy #1.

Subsequently, it’s important to know that you can leverage access to your executives to exemplify to a new supplier that any new proof of concept, tool, etc. will be given the highest level of attention and visibility. This means a lot for any supplier (new or existing) as it ensures the right eyes are engaged.

Strategy #3 – Set Realistic Milestones that are Mutually Achievable

Just as employees like to understand their performance objectives for each year, it has been proven by TNG that suppliers who understand what “great looks like” outperform those that are not given clear business objectives. Nearly everyone in the business world understands the concept of milestones; however, the implementation of the methodology is highly inconsistent.

One of the many mistakes companies make when establishing a milestone-based contract is they make the actual milestones either ambiguous or unrealistic. Both are equally as dangerous. Ambiguity allows everyone to be right and wrong at the same time. Unrealistic milestones, if accepted by the supplier, often induce unhealthy behaviors by those chartered with meeting or exceeding the same. It doesn’t take much to set a once “strategic” relationship on a path to implosion with either of these scenarios.

Establishing realistic milestones is important for your suppliers. Everyone, at every age, enjoys accomplishing a goal. It’s important to recognize this fact since at the end of the day, as this is a human reaction, and well, we’re all human.

To learn how to properly set up a milestone plan and/or implement any other strategies mentioned above that drive performance for both the company and the supplier, here’s a hint: It’s not just the supplier that has performance milestones!

More resources

From Fortune 500 giants to fast-growing innovators, TNG has helped clients save 20% – 40%+ on enterprise software contracts — even when they thought it was impossible

My 3 Guiding Principles for The Negotiator Guru

Imagine you are a C-Suite executive and your business is built on a franchise model.

Each franchise branch is owned and managed by a different person but they all use the same ERP and the big corporate umbrella entity that you own pays for all the services.

The individual owners dictate which software and services they use, how many licenses they need, etc.

Your annual bill for all the different contracts comes to $2.5 million.

How would you feel if I looked through your contracts and told you that, based on the prices your peers pay, you should actually be billed closer to $900,000 - a more than 60% savings - for the same host of services?

You’d probably want to flip the table we’re sitting at.

I started The Negotiator Guru because I believe in 3 things:

Clients should all pay the same price for the same product*
Clients have the right to know what rates they should be paying in comparison to their peers.
Clients should know what to look for in software contracts to eliminate potential issues before they arise.

I want to go into each of these beliefs in more detail and give some case study examples to further demonstrate why I think these points are so important.

Clients should all pay the same price for the same product.

It’s common for people to believe the price they’re paying is equal to what their neighbor paid for the same product.

Due to both Master Service and Non-Disclosure Agreements between most software vendors and their customers, companies are not allowed to publicly share what rates they’re paying for their different products/services. Subsequently, software suppliers will almost never advertise a specific price point for enterprise customers but rather indicate “call for details” in the interest of driving the most revenue from the potential relationship.

In other words, in the art of enterprise SaaS sales, you won’t find any published rate information for you to benchmark your contract against. The only way for you to identify whether or not your rates are competitive is to engage a firm that holds that market intelligence as a result of analyzing contracts on a daily basis.

The fact of the matter is: Prices always vary.

No one pays retail as an enterprise customer but some companies achieve significant discounts compared to other similarly-sized operations.

In some cases, you’re getting ripped off if you’re not getting an 80-90% discount off published prices.

It wouldn’t be logical to expect a huge company like Coca-Cola and a small startup to be paying the same price purely based on volume alone. But brands of the same size with similarly-sized contracts (based on annual revenue & annual spend for their contract) should be paying the same price.

I have great respect for wonderful sales executives who sell value to customers, but my company believes the market should dictate a fair price for all IT goods & services (Services, Software, Hardware, etc).

The enterprise sales executive is arguably the greatest asset these IT companies have within their organizations. The good ones truly know how to sell “perceived” value.

Regardless of how personable a sales executive is, we believe the market should dictate what a fair price is - much like buying or selling a home. In order for this work, we believe that rate information should be readily available to customers. In order for this information to be shared legally, we need to enter into a commercial agreement with your company and charge for these advisory services.

Clients have the right to know what rates they should be paying in comparison to their peers.

On a daily basis we see similar-sized clients with similar-sized contracts have a 30 – 60% price variance.

Now, whether this is because some companies didn’t have strong negotiating skills or perhaps they just didn’t know how their contracts compared to the market doesn’t matter. What does matter is that clients know how their contract prices compare so they can make future decisions accordingly.

Ideally, through access to more information regarding IT contract pricing, you’ll be able to secure the best rates for your company. Leveraging this information can significantly impact a company’s bottom line.

But even if you aren’t able to achieve best-in-class pricing, we believe you should know what those rates are to empower decisions on how to work that supplier moving forward.

Often, relationships with IT suppliers run into the roots of your business and once you’re in that deep, it can be hard to break loose to find another vendor.

Even if you can’t get off of a big platform like Salesforce, Oracle or another ERP, you can make better-informed decisions about how you’re going to increase or decrease your use of that platform in the future.

There are a few market intelligence firms out there that supply basic and watered-down pricing information to clients but require a $30,000 per year subscription fee (per seat). This cost to have access to this benchmark data isn’t a feasible or justifiable expense for many companies.

We don’t feel that only Fortune 500 companies should have access to market intelligence firms and benchmark data.

The existing methods used to decide what the best price really is for any given enterprise could be improved. Most market intelligence firms take a general approach to setting correct pricing rather than looking at the specifics of each contract and the unique needs of each company.

For example, these firms will recommend that you should be getting a 60% discount if you’re spending $1 million with a particular IT company as a blanket rule.

Instead, we take into consideration the specific needs of our clients and use a Right Size, Right Price approach within every contract negotiation.

Clients should know what to look for in software contracts to eliminate potential issues before they arise.

Having a deep understanding of the terms of your most expensive contracts will help you save hundreds of thousands of dollars.

Here I want to briefly outline a few common contract issues that I see my clients face:

Price Protection (and not just by SKU)

Price protection generally comes up when you’re signing your first contract with a software provider. IT companies will compete for your business by offering you the lowest prices for their services with the expectation that they’ll be able to raise the rates once you’ve completely adopted the product.

Companies will always try to find ways to increase your annual expense. This is largely due to sales incentive plans in place with their sales development organization. Common tactics used by software companies include random internal audits to monitor usage (overage fees), product lift and shift changes (new SKUs), and service fees (for enhanced customer support).

More often than not our clients are very astute individuals that use their best efforts to price protect their organization’s contract for future years. That being said, it’s unrealistic to think anyone knows how to mitigate all the potential risks unless you do this everyday.

For example, to mitigate against the software companies from simply changing product names (SKUs) to bypass any preexisting price protection you may have on a specific product, we suggest you introduce contract language that protects your company using your total spend (vs a product-specific SKU) as the common denominator.

M&A Language

Make sure you have specific language in your contract about what happens in the case of a merger or acquisition.

Be sure to include language about a Termination for Convenience. This is a provision allowing you to get out of the contract if you acquire, or are acquired by, another company within a certain time frame - usually 90 days to 6 months.

Termination for Convenience eliminates the risk of having duplicate service providers for the same service after the transaction is closed. Without this stipulation, companies can find themselves with millions of dollars in expenses that are avoidable.

Note: In the interest of this article’s brevity we aren’t going to stipulate all the protections you need in an M&A transaction as this will be further explored in a future article. While the guiding principles of what to include within your contracts will remain consistent, client-specific protections will always require advisory services.

Termination for Breach

Termination for Breach language is important information to include in your contracts. In these cases, attorneys have to be involved and mal intent has to be proven by the accusing party.

This rarely ever happens and having the language laid out in the contract incentivizes IT companies to behave their best throughout the contract term.

License Limitations

It’s common to have language surrounding license limitations in your contracts. This basically says that you can use a specific license at a specific site for a specific reason.

These stipulations probably make sense on the surface and won’t alarm the person reading the contract but in most companies, with thousands of employees, not everyone is reading the contract. This could lead employees to inadvertently infringe on how the license may be used.

The best way for most companies to avoid this is to have seat-based pricing attached to specific personas (usage rights) rather than volume-based pricing.

Audit Rights

We’ll go into this further in a future article but I want to point it out here that you should be in control of the audit capabilities - don’t leave that in the hands of the supplier.

When IT companies retain audit rights, they have a Trojan Horse to get inside your company and find more ways to increase your pricing. They already know more about your company than you do - don’t give them the reigns to take over completely.

Roles & Responsibilities (when working with multiple parties)

Establishing clear lines of accountability is incredibly important when you’re working with multiple third parties.

As the owner of Company ABC, you’ve got Supplier X and Supplier Y. In each contract where there are dependencies for another supplier to take action, you will want to include a Roles & Responsibilities Matrix so that all parties are contractually agreeing to the same responsibilities/accountabilities. Conducting this exercise is not only a good way to align parties prior to the start of any project but also contractually protects you from any finger pointing across these same parties which will ultimately cost you time and money.

This Roles and Responsibilities matrix is oftentimes called a “RACI” Matrix - Responsible, Accountable, Consulting, Inform. The example below shows how it is used to clearly define roles and responsibilities across and within parties.

You can clearly see the task at hand, who is responsible for it, who is accountable for it, who needs to be consulted for it, and who is informed by it. Where appropriate we suggest including your internal resources as well as more often than not your suppliers will require your team to take action as well. Our clients use the RACI matrix process within their internal organizations as well to drive alignment and avoid potential issues before they arise.

From a tactical perspective, it’s important that the same RACI matrix is included within each supplier’s contract so that everyone is operating from the same table, terms, and conditions. This often takes some negotiation but with the proper foundation and alignment, you shouldn’t have any pushback from your suppliers. In fact, if you do have a supplier that is heavily pushing back against this exercise we recommend our clients view this as a potential leading indicator for what’s to come with that particular relationship.

With these 3 guiding principles, we ensure our clients are negotiating the best contracts for their needs.

Whether you’re in the process of negotiating your first IT contract or are looking to save big on your next renewal process, we’re here to share our experience and expertise with you.

We want to ensure that you’re paying the right price for the right products.

We want to make sure you have benchmark data to help you make decisions about the future of those contracts.

We want you to avoid contractual pitfalls by including key language around important, often overlooked points.

The Difference Between Gartner & The Negotiator Guru

Gartner, at its core, is a market intelligence firm. It uses a wide-angle lens to give you a big-picture view of market and industry trends. You can use their data as general negotiation guidance and add their toolkits to your own.

There is absolutely value in this broad-stroke model but it can be limiting when it comes to looking for data and resources that more specifically mirror the size and needs of your organization.

In this article, I want to outline the similarities and differences between a simple market intelligence firm approach and a niche service provider approach. There are many reasons you might want to research best practices from a 30,000-foot view as well as dive deeper at a 5,000-foot view.

Many of my clients will use both Gartner’s and The Negotiator Guru’s (TNG) services to achieve the best results for their companies.

The graphic below gives a basic overview of the similarities and differences between our companies and we’ll break each one down in this article.

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There Are Some Similarities Between Gartner & The Negotiator Guru

Both Gartner and TNG provide information on market and industry trends as well as general guidance on IT Cost Optimization. We have each developed our own toolkits to strategically approach each client’s needs. We overlap when it comes to providing general guidance to CIO’s.

Our companies also both provide rate benchmark data although, as you’ll read below, we go about this in different ways. Gartner has quite a bit of data they provide in aggregated terms which is useful but, without isolating the information by industry or annual spend or similar categories, it can be difficult for CIOs and their supporting functions to narrow down actionable intelligence that is defensible and realistic.

There Are Many Differences Between Gartner & The Negotiator Guru

The keyword I would use to describe the services Gartner and TNG have in common is ‘general.’ Gartner is a great resource for general information across a wide array of topics but rarely provides niche depth that our customers are longing to consume.

In contrast, TNG has a deep and disciplined focus within the IT Software vertical which enables our team to share actionable insights that are localized, specific, and highly relevant to our clients. In fact, it was our early clients that helped shaped this disciplined focus as they made their niche needs clearly known to our team. Due to our outstanding client family, TNG has been on a journey to fill our clients’ market intelligence needs for specific supplier relationships. This has organically driven our firm to be the worldwide leader in Salesforce Contract Negotiation Advisory Services which typically is 80% of our work portfolio at any given time.

With the average cost of a Gartner subscription being $30,000 per seat, plus additional consulting costs in order to receive personalized advisory services, it’s worth your while to be informed on what they can and cannot help you achieve.

Because we provide specialized data and consulting services, we’re able to dig deeper into our clients’ businesses and tailor our process to better achieve the results they’re looking for.

The following are a few of the specific areas The Negotiator Guru differs from Gartner in terms of what services and results we can offer our clients.

Right Size

While Gartner has a wealth of industry data and information, it can be nearly impossible for a client to look at the data and isolate a specific instance to best compare themselves to their peers. This leaves clients feeling informed but uncomfortable about how this information is applicable, and more importantly defensible, within their environment.

In certain circumstances, Gartner will provide “best in class” rates for a specific digital capability or service portfolio. One would argue that this provides directionally correct price targets to use as a market intelligence within their supplier negotiation. We generally agree, however, it’s important to note that your software sales executive (or worse yet your internal colleagues) will very quickly share with you that you don’t fit the profile of those rates for XYZ reason. We know this because we’ve been in these conversations on countless occasions.

In the rare case that you obtain “best in class” rate information for your specific topic of interest, you are still missing a critical piece of knowledge which we call our “Right Size” guidance. Using conservative figures, there is a 15-20% value-capture opportunity just by applying Right Size practices to your research and internal analysis before entering into any IT contract negotiation

Our supplier-specific expertise is one of the biggest contributors to this Right Sizing approach.

Within our Discovery Phase, we take an inventory of your current products and licenses and match them against your actual business needs. Almost always, we find that our clients are over licensed and have shelfware within their environment. This is an example of Right Sizing.

From a Right Pricing standpoint, not only do we understand “best in class” rates, we localize price targets based on industry, client size, and contract value. This enables our clients to feel 100% confident about the market intelligence as we’re benchmarking their rates against that of their likesize industry peers.

To expand upon this difference, we’ll use our expertise in Salesforce as an example.

As raised and validated by leading consulting and intelligence firms, TNG has the most comprehensive database of Salesforce rates in the world. This capability allows our team to quickly and easily perform a price benchmarking exercise for our clients. In many instances, we’ll inform prospective clients that their rates are within an acceptable margin of their “Right Price” benchmark and that the only real opportunity (if any) is to pursue “Right Sizing” inside of their environment. At TNG, our culture and client centric values direct our work and guide us to only accept prospective clients where we know with certainty there is a strong potential to drive huge impact.

Being able to combine Right Price and Right Size analysis will have a significant impact on the effectiveness of your supplier negotiation strategies.

Contract Language Risks

As a result of our deep supplier-specific expertise, our team on average analyzes 5 - 15 software contracts per day. As a result, we know what’s “normal” with all of the large enterprise software platforms and any common risks that are inserted unbeknownst to our clients. By doing this every single day, our team is easily able to identify commonly-used, ambiguous language that always favors the supplier.

Large software companies know their customers rarely spend time analyzing terms and conditions within their contracts. Furthermore, the widely accepted principle of Software-as-a-Service (SaaS) leads clients to believe the terms are standard and unchangeable.

Unfortunately, this simply isn’t true. As part of our Contract Execution Phase, we conduct a deep dive assessment of our client’s supplier contract as part of our standard service (another major difference from Gartner). To put the impact of this added service into context, our team identifies a unique contractual risk within SaaS contracts alone 33% of the time. If the contract we are analyzing is not a SaaS contract, contractual risks are identified, on average, 85% of the time. Knowing what to look for in each supplier’s contract language helps our clients avoid common pitfalls and supplier-centric renegotiation strategies.

Sales Playbook Coaching

Another key difference between taking a general approach on market intelligence (Gartner) vs. a software specific deep niche (TNG) is the ability to learn and leverage the sales playbook(s) for these large enterprise suppliers. It may not surprise you that within the most successful software sales organizations are repeatable and prescriptive sales playbooks that guide the near robotic actions of their sales representatives.

As a result of learning these sales playbooks we are literally able to tell our clients the moves their suppliers are going to take next. This intelligence allows us to be one step ahead within the negotiation process while leveraging the interests of both parties.

While the art of negotiation is an art and not a science, arming yourself with this intelligence allows you to deploy counterintelligence strategies inside of your organization (to counteract common supplier tactics such as divide and conquer) while also proactively preparing counterpoints to their foreseeable arguments. As a result, our clients commonly tell us that they were the most prepared they have ever been before, during, and after a negotiation.

Advisory and Execution Services

We don’t just tell you what is possible. We help you achieve it.

The biggest criticism most companies have of typical market intelligence and/or management consulting firms is that they’ll tell you what “best in class” looks like but will leave you to figure out how to achieve it within your organization. If they do offer advisory services that help you implement their “best in class” then it will be for additional fees that eat away at the cost savings potential, etc.

We’re a full, beginning-to-end provider who will help you all the way through to the execution of the contract..

At TNG, we not only share a “best in class” picture but also create a realistic future state localized for your business. We help you implement that future state while also limiting risks to your organization long after our engagement ends. This is all part of our standard duty of care for our clients.

4-Step Negotiation Process

Our proprietary 4-step negotiation process allows us to deliver a clear and consistent service to our clients. In the interest of brevity we won’t go into detail of what each step entails, however, please know that within the Discovery and Strategy steps you will walk away with a forward looking roadmap as part of the overall engagement. If even offered, this would be an extra advisory fee from Gartner and/or any other market intelligence and/or management consulting firm.

The graphic below quickly outlines our negotiation process:

Compensation & Fees

Our compensation for these services is also entirely different from Gartner’s method.

As mentioned above, Gartner’s average subscription rate is $30,000 per person plus any additional consulting fees.

With this package, you have access to their standard publications, toolkits, and potentially a limited number of “analyst calls” which are quick conversations with the author of the publications. Any additional advisory assistance, if even possible, comes as an upcharge. Even with this additional cost, you will be on your own from an execution standpoint.

We charge either an Advisory Fee based on annual contract value or we offer a Pay Per Performance option with a simple baseline calculation.

We don’t charge based on a subscription service to our articles, we provide all this information for free.

Our rates contain no hidden charges or surprise upsells. On top of that, we’ll help you execute the strategies we develop with you.

We’re incredibly transparent with how we price our services and our clients never question the value they achieved from engaging with TNG.

Combining a Broad Overview Approach with a Specialized, Niche Consulting Firm is a Winning Equation

One of the questions we hear frequently is whether someone can/should work with both Gartner AND The Negotiator Guru.

The answer is yes!

Gartner provides a lot of good, general information. TNG helps you zoom in on the information that is most relevant to your organization so you can determine which key findings are critical for driving cost savings/avoidance while lowering your contractual risk.

Gartner is a market intelligence research firm that has a very limited advisory component separate from their articles. They do not generally provide execution services.

TNG provides information without a subscription fee and our advisory and execution services are provided in the same package.

Bringing in TNG to help you pinpoint your specific needs, value capture opportunities, and execution strategies will provide immediate and long-term intrinsic value for your organization. Remember, TNG will only accept you as a client if there is clear and distinct net positive impact potential… well, we can’t speak for the other guys.

Quid Pro Quo: Salesforce & Salesforce Consulting Partners

We commonly get asked the following questions in varying forms:

Is The Negotiator Guru (TNG) a Salesforce Partner? Are you on the AppExchange?
What are the differences between TNG and a Salesforce Partner?
Why can’t my Salesforce Partner advise me on the best possible rates/products for my Salesforce environment?

Before we get into the specific answers to the above questions, let us share a brilliant unsolicited quote from one of our recent multinational clients regarding the motivational differences between TNG and a Salesforce Partner:

Expecting a registered Salesforce Partner listed on the AppExchange to give you completely impartial advice on Salesforce pricing is like expecting a court room prosecutor to share their notes with the defense before every trial.

Why, you might ask?

The answer is simple: All Salesforce Consulting Partners have an unavoidable conflict of interest with their clients. Why? Because of the inherent need for these “Partners” to make both their client and Salesforce happy.

In this article we’re going to cover this conflict of interest and why TNG is different.

Salesforce Partners Always Have Two Clients (and one isn’t you)

Salesforce Partners have two customers:

You the client; and,
Your Salesforce account management team (hereby collectively referred to as “Salesforce”)

The fact of the matter is that your Salesforce Partner is, by design, incentivized to keep both its client and Salesforce happy. The difficult truth is that you, the customer, are the least important of the two clients. Yes indeed, more often than not, your Salesforce Partner has a greater long-term interest in keeping Salesforce happy. Yes, we know this sounds horrible, but we hope you appreciate our directness here.

Let’s dig into two key, but interrelated, reasons:

‍1. Business Relationships

Your Salesforce Partner focuses heavily on keeping a strong business relationship with Salesforce. Why? Because Salesforce is their single most effective sales channel to acquire new business. When Salesforce identifies a new or existing client that needs custom development work, they have the entire Salesforce Partner community to consider when providing a recommendation to their customer. Naturally, those Salesforce Partners that are “supportive” to their sales process will be referred more and more business.

‍2. Money

‍More referrals = more business = more money.

Back in the 18th century Edmund Burke once said “…never bite the hands that feed you.”

Presenting this differently, if you were a Salesforce Account Executive and you had a Salesforce Partner repeatedly suggest changes to an account that materially decreased your sales compensation revenue, would you continue using that Partner when you have others options available?

To be clear; we are not saying that all Salesforce Account Executives are unethical in how they conduct business. However, we are stating that there is an inherent fundamental conflict of interest for the Salesforce Partner who commercially needs to appease both parties.

The unfortunate situation is that while a Salesforce Partner may know a customer is being sold more products and/or services than they actually need, they rarely speak up for the reasons above. We’ve even been told there is an informal blacklist inside of Salesforce that keeps track of these Partners that raise cost avoidance opportunities during the sales process.

We don’t like writing about this topic but we know every customer wants the truth.

‍Why TNG is different

Quite simply we are only focused on keeping you, the client, happy. When the firm was founded we only included a “pay for performance” compensation option to ensure our incentives were aligned with the client. Over the years, we added an “advisory fixed fee” option purely based on repeated client requests.

‍TNG’s Right Size & Right Price Process

Part of our secret sauce is a deep focus and understanding on 1) how Salesforce works, 2) you as a customer, and 3) best practices on how to quickly drive savings in your environment. While strategic negotiation is an art, our Right Size & Right Price process is more of a science based on its repeatability across all industries.

The Right Size process

‍ focuses on identifying consumption based savings opportunities within your organization.

Our three most commonly identified opportunities within this process are:

“shelfware” elimination
license optimization
governance enhancement. On average, we identify 24% savings opportunity within this process alone.

The Right Price process purely focuses on your product and service price points within your specific Salesforce contract. The vast majority of our clients reach out to us for this service alone. Specifically, they want to know how their prices compare to their peers and if they’re getting a “good deal.”

We have the largest database of Salesforce rates in the world and can quite easily identify if there is a price optimization opportunity within your various SKUs. Unlike other large market intelligence firms, we are able to isolate your realistic “should cost” price points based on your industry, annual revenue, and annual contract value. The others simply will share a “best in class” rate which is ambiguous and often self-serving.

On average, we identify a 22% savings opportunity here but your specific opportunity could be as high as 305% (yes, this was a real client).

Fit-for-Purpose Engagement Style

The Founder of TNG, Dan Kelly, feels strongly about providing our clients options on how they engage our firm depending on each individual client’s needs. Some clients want a “negotiation-as-a-service” approach while others simply want the output of our Right Price process to identify target price benchmarks to use within their own negotiations. We welcome you to start a conversation with our firm to determine how we can most effectively and efficiently support you.

‍Summary

To recap, here are the basic points of what we’ve covered in this article:

Your Salesforce Partner has motivation to keep both you and Salesforce happy;
They aren’t able to easily share cost savings opportunities with you in fear of losing future opportunities with other Salesforce customers;

The Negotiator Guru is only focused on driving cost savings for you by negotiating with Salesforce, the client;
We have a proprietary negotiation process that includes both the art of negotiation and the science of opportunity creation inside of your Salesforce organization,
On average, we save clients 20-50% on their Salesforce annual expenses through our Right Size and Right Price process; and,
On SELA Agreements (Salesforce Enterprise License Agreement), we typically generate a 41.3% savings for our clients.
We only accept clients within our full negotiation service where we know we can make a huge impact.