Vinnie Mirchandani knows a lot about technology and professional services procurement. Having spent years as a senior Gartner analyst and lead principal at a major Big 5 firm helping companies source technology and services from vendors, you could say the man practically wrote the book on how to extract concessions on such areas as software maintenance and hourly fees -- as well as the best means of ensuring high quality and on-time implementations.
Old-time readers of Spend Matters know that I enjoy Vinnie's blog, Deal Architect, immensely. But while the blog hops around from subject to subject, it's most pragmatic when Vinnie writes about what he knows best. His recent post Putting Strategic Back in Strategic Technology Sourcing is such an example. The post is full of insight that anyone involved in services and technology sourcing can appreciate. For example, "When the average corporation makes 25-30% gross margins, how can sourcing say they are doing a good job when their software vendors are making 90% gross margin on their annual maintenance? Offshore vendors -- supposedly "cheap" -- making 45%? For every dollar in technology spend, their peers in raw material or other indirect procurement have to severely beat down those vendors to average out the high margins in technology spend." With observations like this, if you're not a Deal Architect reader, you should be!