The client, a Fortune 100 multinational manufacturing company, had a complex IT service delivery model that supports its business units across the globe. Prior experience with a sole provider outsourcing contract had been largely negative, and, as a result, the client was in the process of replacing this arrangement with a series of contracts with a network of key tier 1 service providers, each responsible for a portion of the IT service portfolio. In this case study, WGroup helped to facilitate an assessment of the clients current IT service delivery model and establish a multi-supplier governance model based on client requirements, best practices, IT industry trends, and competitive pricing.

1. Opportunity
The client, a Fortune 100 multinational
manufacturing company, had a complex
IT service delivery model that supports
its business units across the globe.
Prior experience with a sole provider
outsourcing contract had been largely
negative, and, as a result, the client
was in the process of replacing this
arrangement with a series of contracts
with a network of key tier 1 service
providers, each responsible for a
portion of the IT service portfolio.
While this multi-supplier arrangement
helped distribute risk, leveraged
service provider best-of-breed
capabilities and enabled the client
to obtain highly competitive service
rates, it significantly increased the
overall governance complexity,
management requirements and created
a fragmented operating model.
In addition to the handful of major
service providers, the client had many
tier 2 and tier 3 service providers
involved in the overall service delivery.
The client had a small, rudimentary
supplier management organization
that was primarily consumed by the
effort to consolidate service reporting
for tier 1 service providers and react
to any major operational issues as they
arose, leaving very limited bandwidth to
focus on governance related activities.
There was certainly no bandwidth for
managing any of the tier 2 or tier
3 providers.
The client sought WGroup’s
experience and expertise to
accomplish two objectives:
• To evaluate and re-think its
multi-supplier governance and
management approach. Included
in this was the need to assess
the current multi-supplier
management organization, structure,
roles, processes, skills, etc.
• Additionally, given that the majority
of IT staff was outsourced to one
provider or another, the client was
extremely interested in fostering
supplier-led innovation, within the
context of their operating model.
Drive Your Business
Multi-Supplier Governance
WGroup helps Fortune 100 company establish
governance mechanisms to improve IT service
delivery from its suppliers, while fostering innovation.
Manufacturing | Multi-Supplier Governance
1
WGroup helped
to facilitate an
assessment of the clients
current IT service delivery
model and establish a
Multi-Supplier Governance
Model based on client
requirements, best
practices, IT industry
trends, and competitive
pricing.

2. Supplier-led innovation
is a leading edge
capability that IT
organizations are just
beginning to tackle.
Approach
A team of two WGroup advisors, each
with decades of experience leading
IT initiatives and implementing IT
governance models, conducted in-
depth interviews with key Business,
IT, Procurement, and Service
Provider (tier 1) stakeholders to:
• Discover various aspects of
the current IT Operating
Model, Supplier Strategy &
Management, Supplier Governance,
SLA Framework, etc.
• Identify issues, challenges
and opportunities
• Identify gaps and operational issues
in comparison to best practices
• Analyze risks associated with
current multi-supplier strategy
and service management model
• Identify future state
requirements and strategies
In particular, they worked very closely
with the client’s supplier governance
team members to fully understand the
current state processes, key supplier
interactions and meetings, roles
and skills. Additionally, WGroup
advisors also used various evaluation
frameworks to quantitatively
capture current state capabilities and
identify future state requirements.
WGroup used its proprietary Multi-
Supplier Governance Capability Model
to complete a comprehensive current
state and future state analysis of
• Multi-Supplier Governance
Organization (SGO) goals
and guiding principles
• Multi-Supplier Governance Model
– structures, meetings, agendas,
cadence, participation, etc.
• SGO and skills needed to support
recommended improvements
WGroup
2
• SGO Tools and Technology
needed to support service
integration, reporting, and on-
going supplier performance
and quality management
Supplier-led innovation is a leading
edge capability that IT organizations
are just beginning to tackle. There are
several complexities involved, many of
which stem from the core need to foster
cooperation amongst suppliers and with
the internal IT organization, while at
the same time, managing competitive,
contractual based relationships,
often with penalties and credits.
It’s a balancing act that requires
strong rigor, on the one hand, to
manage contracts and service levels
while requiring flexibility and trust
to share proprietary information,
business strategies, joint development
opportunities, and potential benefits.
In this particular case, the client had
unsuccessfully, experimented with
innovation initiatives.The causes of
which were manifold, with the suppliers
and the client sharing the blame.
Our analysis, using the WGroup
Supplier Innovation Model, revealed
root causes and identified structural,
contractual, and process improvements.
Insights and Advice
WGroup identified several
recommendations, backed up with
quantitative measures and qualitative
insights, grouped into three main areas
(see table on Page 3):
1. Governance Organization
Roles and Capabilities
2. Service Level Management
Framework
3. Innovation

3. Value Delivered
WGroup’s assessment and
recommendations were
enthusiastically received by the
organization, stakeholders and
project sponsors. Some changes were
to be implemented immediately;
other recommendations were being
socialized across the multiple business
units prior to implementation.
By following the WGroup team’s
recommendations, the client expects
to benefit from:
• Improving service delivery
to their end-customers
• Significantly reducing cycle
time for key service processes
• Improving governance and
management competencies,
enabling stronger service provider
efficiencies and relationships
• Strengthening contract
compliance and execution (process
consistency and efficiency)
• Planning & managing sourcing
activity consistently
• Overall run rate reduction
and leveraging economy of
scale across enterprise
• Developing strategic
partnerships, supplier
collaboration and innovation
Multi-Supplier Governance
3
Expand Supplier
Governance Organization
Role & Capabilities
Evolve Multi-supplier
Service Level Management
Framework
Create Innovation Team &
Collaboration Mechanisms
• SGO needed to fully own
tier 1 supplier relationships
as well as the overall
strategy and segmentation
approach for all suppliers
• Other groups (Procurement,
Finance, Legal, etc.)
would continue to play an
important role in supplier
management processes.
• This would require
improvements in SGO skills
and additional staffing,
which were fully identified
and rationalized.
• Specific SGO process
areas which needed
improvement, were also
identified and high-level
process maps were
provided to the client
• A complete and
comprehensive revision
to the Service Level
Management (SLM)
framework to map end-
to-end SLAs to supplier
specific contract SLAs
and Operational Level
Agreements (OLAs).
• These changes were to be
automated via a service
integration project that was
underway at the client and
would, upon completion,
provide a balanced,
360-degree, long-term view
of supplier performance/
quality.
• Specific contract clauses and
incentives were identified
that further supported
collaboration, risk/reward
sharing and long-term
supplier performance
• The standard innovation
approach (ideation-selection-
pilot-implementation) had
not worked for this client,
and WGroup presented
a completely revamped
approach to innovation that
took into account their culture
and needs.
• Leadership commitment and
culture were identified as key
enablers and this required
significant organizational
change management for this
particular client.
• WGroup provided full details
on how to stand-up the
innovation team, implement
new innovation processes, and
reset key supplier relationships
to foster innovation.

4. Contact Us
WGroup
301 Lindenwood Drive, Suite 301
Malvern, PA 19355
610-854-2700
Copyright © 2014 WGroup. All Rights Reserved.4
CPG_OSRNGCS_100312_006
About WGroup
Founded in 1995, WGroup is a boutique management consulting firm
that provides Strategy, Management and Execution Services to
optimize business performance, minimize cost and create value. Our
consultants have years of experience, both as industry executives and
trusted advisors, to help clients think through complicated and pressing
challenges to drive their business forward.
For more information on WGroup, visit http://thinkwgroup.com