impacore – a different approach to professional services procurement – part 2

We wrote in part one about impacore, the German firm, who are working with clients to help them manage their professional services providers better. As we said, it is an interesting model based on detailed surveys of client staff to gain an assessment of the provider and assignment progress and success.

I met Martin Dürr, one of the founders and Directors, to ask him about some of the more interesting aspects of the impacore business model.

What are you assessing – the performance of firms or individuals?

Because the ratings are based on a specific project assessment, this is not at firm level. It might be at individual level if it is a small project, but usually it is at a team level. Of course, that may reflect on a particular partner in the firm.

How are your clients using this to link performance to payment?

Payment to providers can be based on achievement of certain ratings on our assessment system. That can be a simple threshold target, or something more complicated. And some of those ratings or measures can be objective, hard data such as achieving deadlines. Others can be survey based.  Where providers have not performed satisfactorily, the main goal is to get the project back on track. But clients can get rebates for work already done or cost reductions for the future.

So why couldn’t clients do something like this themselves – why do they need impacore’s help?

Our surveys are electronic and anonymous, so people from different parts of the organisation feel comfortable giving their honest opinions of the project and provider performance. As a third party, we offer an unbiased approach – results are more easily skewed if this process is done internally.  And we use the considerable benchmark data we have collected to interpret and assess results.

That may not make you popular with the industry I guess!  How do the professional services providers generally feel about your involvement – you are in a sense getting between them and their clients?

I think they are positive generally – especially those who are getting good rating results. If we can help difficult projects run better, than that benefits them as well as their clients. In fact, what is interesting is that some providers are now actually including our services as part of their proposals when they are bidding to win assignments. So they will fund our services, and they see that as helping to guarantee the project success. So they’re happy to include us as part of their overall proposal to the client as a differentiator.

Are you seen as a threat by the procurement community?

We usually work alongside procurement teams. We are not competing with them, we are not developing category strategies, and usually procurement is still negotiating the fees with the providers – although we do have benchmark rate information, so if the client wishes, we can help with that.

Thanks for your time Martin!

So, I started out slightly sceptical about the business model here. But actually, I can understand why this  could work in large firms where, as we said in part 1, no-one tends to have that overall grip on professional services assignments or providers.

And that point Dürr made about being engaged by the provider side is potentially very powerful. It shows impacore has the scope to work for both sides of the transaction, which greatly enhances their chance of real success. If the industry side embraces the whole concept of this type of performance management, impacore is going to do very well.  We will keep an interested eye on their progress.

 

First Voice

  1. Ian Taylor:

    Its good to hear of a European corroboration of something we are already doing for local government! We launched NEPRO (NEPO – NEPRO, geddit?) this year being a managed service for professional services with what sounds like a similar structured approach to managing and reporting on the outomes of assignments but also using our service provider to source potential suppliers for each assignment. Its building momentum with a number of local authorities in the North East and elsewhere. One of our main aims is to build up knowledge about the quality and competitiveness of professional services in the region – especially SME’s – and to identify gaps in provision where new providers can be encouraged to enter the market or expand their range of services. I mentioned the approach briefly during my starring role at the Communities and Local Government Inquiry into procurement in the sector last month. Go to NEPRO.org.uk if you’d like more information. We think it complements the major consultancy frameworks in the public sector and customers can chose the best option for their needs.

Discuss this:

Your email address will not be published. Required fields are marked *