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.
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.
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
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!
Start with a CIA.
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Upload your contract data or schedule a discovery call. If we can’t identify at least a 10%+ from a TNG Right Pricing™ opportunity, we won’t take your money (but we will offer you some free advice!)
