Why a Proof of Concept TEM project is beneficial for both customers and suppliers
What is a Proof of Concept?
Proof of concept projects are becoming more popular. They provide an opportunity for a potential supplier to carry-out a relatively small piece of work for a customer without taking on a large, long-term and far-reaching commitment. A proof of concept project gives each party a low-risk opportunity to trial out the other. For the customer – they can have a chance to taste what a full-scale Technology Expense Management (TEM) project might look like and what results it might bring. And similarly, a supplier can see what a small part of the customer’s IT and telecom estate looks like, and prove themselves in the hope of securing a larger project in due course.
This “toe in the water” approach works well in the current risk-averse climate where CIO’s and FD’s tend to be cautious about committing their precious budgets to mid or long-term projects (i.e. more than a year)
How long does it take?
The time taken to run a POC will generally depend on the size of the estate chosen to review. In our experience, it typically takes 3-6 months, with the key activity being the initial collection of the data and loading it into the TEM platform to create an inventory of the telecom estate. Once that task is complete, the analytical work can start on identifying where savings can be made.
The scope of the POC should be narrow and will focus on key areas where issues are known to lie within the estate.
The customer’s perspective
There are several reasons a customer might want to opt for a POC. Firstly, many IT and Telecoms managers recognise that they have an issue with their telecoms but they don’t clearly understand what it is or where it lies within their estate. And whilst they’re aware of a need, they might be only partly familiar with the concept of TEM; they might not be entirely sure how it works and what benefits it can bring to their business. Sensibly, they may not want to jump straight into a 3-year contract with a previously untried or tested TEM supplier.
A POC allows them to test the water, and there’s no financial risk to the business, as the POC will be underwritten by the TEM supplier (Veropath underwrites all POCs, although that may not be the case with all TEM suppliers).
Similar project methodology will be used to that of a full TEM project, so the customer can understand what involvement and commitment would be involved if the decision is made to expand to the full scope of the estate.
Crucially, the results of a short term POC will indicate what else could be saved or optimised by undertaking the full scale TEM project – in other words, you get to see the size of the prize.
For the supplier, a POC is a great way to showcase their capabilities. And getting to see one area of the customer’s telecom estate is good pre-cursor to what it might be possible to find during a full TEM project.
To recap, a POC is a useful way to prove the value of taking on a Technology Expense Management tool. The underwritten element of a POC makes it particularly attractive to risk-averse budget holders. At Veropath, we have never paid back any underwritten costs to a customer – we always find areas to save money.
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