Case Study #1: The Case of the Inflexible
Vendor
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| PROBLEM: |
| When faced with a significant
reduction in force and the need to provide outplacement
support to employees, the Company’s long-term
outplacement provider priced certain activities
that did not fit the budget. |
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| SOLUTION: |
| A survey of
the outplacement field showed that there were a number
of very capable alternatives, thus a bid was prepared.
As part of the bid preparation, the program objectives
and standards were clearly outlined and a group of
pre-qualified vendors were requested to submit responses. |
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| RESULTS: |
| A 40% reduction in fees, representing approximately $2 million, with comparable service. The original vendor, when faced with a competitive bid, sharpened their pencils and reduced their pricing significantly. The business was shared with a second outplacement provider. This allowed the employer to gain the advantage of competition, have a back-up and compare services between the vendors. |
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©2002 M. B. Taylor Associates, LLC |
