“Win / Win.”

We have heard the phrase a thousand times. Sometimes it seems the concept is so common that we see it stamped on boxes of kids’ breakfast cereal and on cartons of dental floss. Your English teacher would mark you down for typing the overused phrase, and your brother would roll his eyes if it came printed on his birthday card.

But here’s the thing: You see the phrase so much because it is a great, uplifting concept… and it is a great, uplifting concept that works.

Some parts of life really are zero-sum games. We can’t both win a game of Tennis. We can’t both be the first team to reach the North Pole.

But the vast majority of life is not spent in winner-take-all situations. Most of the time we are in situations where we all are better off when the people around us succeed. My life can improve even as your life improves. You do not have to lose for me to win. And a culture where people look for the mutual win is a culture where ultimately everyone wins.

If you are sourcing a function, try to enter the transaction process with a recognition that although each party has its individual goals, it is better for each party when all parties win. If the service provider can make a healthy margin, they can bring the resources that they need to deliver top quality services. If the clients are receiving high quality service, it opens doors to sell additional work. If one party or the other is getting the short end of the stick, all of this falls apart.

Concrete Win / Win Solutions

There are many ways to implement Win / Win concepts into your sourcing relationship. Here are a few ideas:

Correctly Assign Risk and Reward Ownership – Not all parties are equally adept at understanding and dealing with a specific risk. Aim to have the actor who can most economically bear the risk be the one that assumes it, rather than simply trying to move as much risk as possible to the other party.

Due Diligence – Don’t regard due diligence as a necessary evil to get the providers to remove assumptions from the contract. Consider due diligence an opportunity to allow the providers to understand your environment and tailor the solution to it. It will be a big problem for everyone involved if the supplier solution has bad assumptions or big scope misses.

Take Accurate Inventory – Rather than putting all of your faith in a strong true-up clause, spend the time to collect accurate volume baselines moving into the contracting period. Even if a true-up clause puts all of the risk on the provider, it will still be a disaster for everyone if a large volume of servers or voice ports is discovered later.

So when you hear “win / win”, don’t let the phrase bounce off your ears as a cliche. Instead, hear it as a reminder of how you want a deal to turn out.

And then make it happen.

– Chris Payne
5-Nov-2013 – [bio]