Category: Knowledge article

Last year I went to New York city for a family visit. On the night of arrival my family took us out to dinner. Still slightly shaking from the flight, I told my English-speaking aunt that I did not have a major appetite. “Don’t worry”, she said, “feel free to just take an entrée”. Assuming she meant a small, starter-dish, the word ‘entrée’ seemed to be derived from the word ‘entrance’, I happily accepted this plan. You can imagine my surprise when a little later my gigantic dish was served. Upon asking my aunt how large her dish, a main course, would be if this was only the entrée, a big smile appeared on her face explaining to me that in the USA the word ‘entrée’ is used to indicate the main course.

Common language

Although we were both speaking the English language, my aunt and I had misunderstood each other due to our own frames of reference. Such miscommunication occurs often within organisations as well. Despite speaking the same language, it appears to be a challenge for business units with a different focus, for example Business and IT, to correctly understand each other. A true common language can offer salvation. To achieve such a language, Anderson MacGyver uses the Operating Model Canvas (OMC).

Operating Model Canvas

The OMC (see the image below for an example) is a model for the analysis of business activities and connects the business model and the processes, data, and IT-systems of an organization. We invariably print the OMC on a A0-format poster, which shows the interplay among activities, customers and business partners and the relevant information and IT-aspects in a glance. Seeing all these elements on one poster is often new for our clients. The strength of the OMC lies in connecting business- and IT-aspects and the visualisation of their relationships. The OMC has an important side effect: it stimulates the usage of one language for all business units involved, a true common language for business and IT.

Unique

Each OMC is different. Organizations operating in identical fields can execute similar business activities, but each organization is unique due to its specific vision on services, its choices to realize ambitions, or its relationships with customers. Therefore, while developing an OMC, we actively involve our clients in three workshops during which we collectively map the organization and find out what it is that makes the organization special. In these moments, whilst standing in front of the OMC, interesting conversations regarding the core business of the organization and its purpose arise, during which workshop participants develop a true common language by aligning their frames of reference. All facilitated by a model that is understandable for and often supported by the entire organization

For those still wondering, I overcame my personal language shock. Once the astonishment had faded, I happily consumed my starter main course. Regardless, in the future I will check if we are truly speaking a common language.

Example OMC

These are unprecedented times. As the Dutch Prime Minister Mark Rutte mentioned during his weekly press conference: “Corona is the biggest crisis since WWII”. Poverty levels in developing countries could be set back by up to 30 years[1]. Large stock markets show drop rates of 20 percent[2]. The United States of America is facing high numbers of unemployment; in mid-April 6.6 million Americans alone filed for unemployment[3]. No wonder many people experience increased anxiety, stress, and depression.

There are numerous examples from organisations how to cope with these difficult times. Basically, organisations can experience any of these scenarios: they either (1) continue business as usual with relatively minimal adaptations, (2) profit from changes in consumer behaviour as a result of toilet paper-hoarders, panic-buyers, and increased online sales, or (3) prepare for full-blown survival mode. The latter shows diverse decisions in all markets: some organisations try to generate new revenue streams, some go into hibernation to limit their losses, and others accept their loss and aim to support society whilst living off their reserves.

Regardless of the scenario, especially in times of crisis organisations have the power to improve the overall societal state and feeling or drive it further down the drain. Various examples for both exist. Despite facing the hardest hits, many organisations in the hospitality and leisure sector find new ways to earn money. Many divert to delivery services whilst others take a more creative approach; recently the first Dutch ice cream drive-through was founded in Tilburg. Organisations such as LinkedIn, HBO, and Sony (through PlayStation) are offering free content to help people get through the stay-at-home-period. Heineken even announced a remitto two-months’ worth of rent for all its 700 bar and restaurant tenants. Closed gyms are offering their classes online and hotel chains are offering free rooms for medical workers responding to the coronavirus crisis.

Unfortunately, ample negativity remains: many organisations are focussing on their losses, their ‘cannot-do’s’, or the lack of sufficient governmental support and some even demonstrate borderline criminal behaviour. Hunkemöller and De Bijenkorf, for example, stretched their 90-day payment periods to their suppliers by another 30 days. Adidas postponed its rent payments for their German HQ. Other large companies like EasyJet or Booking.com have requested financial support from their governments while being sufficiently resourceful to survive this crisis for a longer period of time. And that is even disregarding the potential dividend payments (171 million pound in case of EasyJet) or the top executive bonuses that in both cases are well within the millions.

It is obvious the Corona crisis puts a lot of pressure on organisations, albeit some will have to face greater challenges than others. Regardless, organisations can somewhat take matters into their own hands by utilizing this crisis as an enabler for positive change. Take another example from the fitness industry, while all gyms are closed, many now offer their equipment for lease, some even make it available for free to contribute to society. Imagine what can be achieved when everyone is working together towards an improved society for the post-Corona era.

So, tell us, what is your silver lining during this crisis? What are you and your organisation doing to survive and give this COVID-19 crisis a positive spin? Share your COVID-specific actions and initiatives by responding to this article. We are eager to hear your story!

You might be wondering how your organisation can or should respond to a crisis such as this one. In the next blog, we will further elaborate upon types of disorder and corresponding reactions.

[1] Sumner, A., Hoy, C., and Ortiz-Juarez, E, Estimates of the impact of COVID-19 on global poverty, 2020

[2] Bloomberg, April 2020

[3] U.S. Department of Labor, April 6^th, 2020

A title that makes me tickle in advance. But simply put, it means that transformation must address two aspects: inclusive and digital.

Inclusive

Inclusive means encompassing everything concerned, which means including as many perspectives as relevant or as thinking from the outside in. Thinking from the perspective of your main stakeholders:

• your customers,
• your suppliers,
• your employees.

These are the parties that you work with every day, interact with, and communicate with. Everything you can do to make the use of your services simpler, easier, cheaper with a better experience for them. You can use technology for this, but that is not enough. The intended change will also need propagation by every one of your organization. By anyone who is in contact with the outside world such as customer service employees, technical service employees, sales people. Make the experience true, influence the perception, make people excited. So, it’s also about purpose: why do we do it, what do we want to achieve and how do we do it.

This transformation, therefore, requires you to delve into the other. So not only in customers with customer journeys and customer contact moments and their experiences but also from other stakeholders. Partnership with suppliers means optimal logistics chains, joint service or product development, sharing of information and knowledge development. Transformation also affects the employee experience. It is not only about interesting work, personal development and good benefits, but also about the experience they have in working with colleagues, customers and making sure they are truly involved in the transformation of the company.  All this requires a good vision of the developments at play concerning the parties that we deal with daily, but also of social developments such as demographic and ecological changes. That means inclusiveness: not so much looking at what we can do better in terms of efficiency, restructuring or improvement of existing services, but looking at how we can solve problems of our stakeholders in the best possible way by developing services in collaboration with others which  are a better response to the needs of our stakeholders.

It requires leadership focused on creating an innovative culture focused on how we can improve or innovate our services or do things differently, better. To achieve this, it is necessary to focus on the outside world by connecting with executives from other business sectors, science education, and opinion leaders. It is a continuous search for diversification with the question: can it be done differently, better? Interestingly enough it is the ‘people’ thing that is becoming more and more central to the digital transformation: how do we give our customers the right experience, how do we cooperate with business partners, how do we develop new services, and how do we give our employees the right experience in transforming the company.

Digital

This business transformation that we are now experiencing has been given the adjective digitally because digital developments make it possible to do many things differently:

• by exchanging data,
• linking processes,
• standardization of data,
• digital links to cooperate with business partners,
• social media,
• development of new products and services,
• deployment of artificial intelligence.

Many things are possible through digital technology. Because these changes are taking place at a rapid pace, it is very important to have a good insight into what happens in other parts of the business chain: both downstream and upstream. How are we going to position our organization in the right way? And what does that mean for our employees, the parties we work with, the way we work (design thinking) and for the users of our products and services?

No matter how digital we make it: people are central to success. If mistakes are made in digital transformation, it is almost always where the human dimension is forgotten or has disappeared.

We are living in exciting times. New technologies and smart use of data offer a wide variety of opportunities. To gain the most out of them, companies require a constant flux of new ideas. A recent World Economic Forum study among senior HR officers at leading companies confirms the need for employees with creative skills. Creativity is becoming increasingly more important each day.

Are managers fully dependent on the creative individuals within their teams? Or can new ideas also stem from employees who are not that inventive by nature? Would it be possible to stimulate those employees in such a way that you effectively increase the creative potential of your team? These topics were the focus of my research.

Quite challenging

Creativity is the act of coming up with new and useful ideas to solve (often complex) problems for which no solution is yet known. Seeing new possibilities can however be quite challenging for most people since we usually are limited by our mental set. The psychological phenomenon of a mental set causes us to be inclined to always approach a problem in the same way, even if that approach does not work. We get stuck in a specific structure of thinking and have difficulty seeing the problem from a different perspective.

Personalities

Some people are better in defeating their mental set than others. In my research, I looked at two personality types that differ from each other in creativity. On the one hand, there is this group of people with an open personality type. This personality is characterized by continually welcoming new experiences and always wanting to meet new people. The open personality has a flexible mind, can quickly switch between different approaches, and has less difficulty finding solutions to complex problems. There is a good chance that employees with this personality will often be asked to come up with new ideas.

On the other hand, there is a group that is characterized by a need for structure to understand the world and to function in it. My research shows that these people are indeed capable of coming up with creative ideas, but that they approach problems very differently. Instead of a flexible way of thinking, they work systematically. They analyze and frame the problem. Within this frame, they are very persistent in finding solutions. The first ideas may not be entirely original, but in the end, they still come up with new creative solutions.

Leadership

During my research on the role of leadership in stimulating creativity in the workplace, I made an interesting discovery. The structured and persistent employee benefits from leaders who consciously use empowering behaviors. These behaviors include putting faith in the employees, removing obstacles in terms of time and resources, promoting autonomy in decision-making, and emphasizing the importance of their input. Remarkably enough, this form of leadership seems to turn out negatively for open people. Empowerment is therefore only productive when people actually need it!

Adjusting your leadership behavior is key! Give individuals with open characters complex problems and let them find the solutions on their own. The persistent and structured group needs to be empowered. Express trust and give them sufficient time to frame the problem to come up with new ideas.Creativity and new ideas are vital in these times of digital transformation. By ensuring your leadership behavior is aligned with the needs of your problem-solving-crew, companies increase their creative potential. By tapping into creativity in all layers of the organization, unexpected and innovative ideas will emerge that enable companies to seize the opportunities that digital opportunities have to offer!

I’m a 2* NOB/CMAS diving instructor (the so called ‘ long way’) and my son is a PADI Open water and Advanced diver (‘the short way’). Diving is in the family and we planned to go on a two-week diving vacation to Zakynthos, which is known for its sea turtles that are hard to find in the rest of Europe. Also, the weather in Greece is nice and it has an excellent business case when it comes to cooking (mainly going to restaurants and near to none self-cooking). Anyway, that aside. The following question then came forth: which diving school will we go to in those two weeks. This is a typical Fit for Purpose question and the Anderson MacGyver selection approach for IT market services could also be applicable to select a supplier of scuba diving services. Let me tell you about our findings.

Working from the Anderson MacGyver approach, the first two questions are: (1) Are we dealing with a ‘Specific’ or a ‘Generic’ activity and (2) do we steer towards cost efficiency or value add. Concerning the first question (specific versus generic), that question is easy to answer: in our case this is typically generic, the standard offer in the market suffices: arrange the diving gear, organize transport to the diving location and ensure competent guidance.

The answer to the question ‘Does this add value to the customer or not’ is a bit more nuanced. Diving schools can be found all over the world, often ‘PADI-based’, with the same type of services. In the first instance, you would think of ‘commodity’. On the other hand, even though the ‘vendor’ is often the same organization (PADI), the manner in which a diving school (the implementation partner) incorporates this can make a rather large distinction. How well-educated is its personnel, how tight is it internally organized, how well-willing is it towards the demands of its customers? From that point of view and in the awareness that you as a customer are still seeking for added value, especially during a holiday, the qualification ‘Value Add’ is the most obvious qualification.

Phase 1: Scoping: Determine supplier criteria and service requirements

We established in advance the following demands in accordance to the MoSCoW principle:

• Must have: a double dive in the morning, so that there is time for other activities in the afternoon (exploring the island, hiring a boat, etc.)
• Should have: a sufficient number of dive sites, twelve days of diving and at least two dives a day would imply a minimum of 24 dives, so variation must be sufficient. In particular diving schools that offer wreck dives will score high
• Could have: Facilities, with the smaller diving schools it will be cramming to get on a zodiac or a small boat, while the larger – and normally better organized – diving schools often have bigger boats with more space and comfort.
• Could have: Material, bringing your own equipment is – in terms of extra payment for luggage with airline companies – often more expensive than hiring. The diving school must have good material, in any case from a safety perspective, but also from a diving comfort perspective.
• Would have: English, German or Dutch speaking supervisors, A briefing that is easy to follow contributes substantially to the pleasure of diving.

In addition, pricing is a factor. Considering that the various diving schools normally do not differ that much in terms of pricing, we will first make a selection based on quality. We will talk about pricing in a later stadium.

Phase 2 Vendor & Solution qualification: determine preferred supplier

Step 1: Qualify suppliers for the short list (market scan)

As said, a diving school on Zakynthos and more precisely: in or around Laganas (because we had an apartment near there and the Caretta turtles lay their eggs on the beaches around Laganas).

A first – Google Maps – search indicated that there were five diving schools in the proximity of our apartment, three in Laganas (five-minute drive) and two in Keri (fifteen-minute drive). There was a large difference in the extent of provided information on the websites. From extensive information about the various dive sites to a little brochure with little to none relevant information. Based on this information, we made a ranking for visiting the diving schools on our long list. Reading through all the acquired information about the diving schools we noticed that all diving schools dived on the Southern point of Zakynthos. The diving schools in Keri were situated closer to this location, which could reduce some of the sailing time.

Step 2: Down select suppliers (supplier qualification)

Overall, we decided to start in Laganas and then drive further to Keri for a suppliers visit on location. With our Request for Proposal – give us a keen price for 24 dives including diving equipment – ‘in the back pocket’. Diving school 1: left a decent impression, however, the receival was more focused on business and they had some problems with giving a price indication for 24 dives. Their big boat would probably be used in the upcoming days/week, while they were currently operating a small boat, and no double dives had been organized at that moment. They had only ten dive sites. Diving school 2: welcoming a young man that needed to contact his companion for every question and could not tell anything concrete himself, eight to ten dive sites, brand-new diving equipment for hire. We got a completely uninteresting offer in terms of pricing. Diving school 3: scored good, personal and nice  welcome, transparent prices with an obvious volume advantage. However, there was no guarantee for a double dive. In other words, with a dive in the morning and one in the afternoon your whole day is filled with driving back and forth to the diving school. We headed towards Keri for participants 4 and 5. Diving school 4: was run by a German family. Good and kind welcome, broad explanation, more than sixty dive sites including day trips to the far North, three boats, each day one or two double dives and – especially when compared to the diving schools in Laganas – interesting packages in terms of pricing. At last – always complete a selection process – we visited participant number 5: No one was present to provide us with information. We did see a pricing table, that showed us that the pricing could be keener (which is information that a purchaser loves), the – wat seemed to be- diving equipment for hire looked somewhat old and worn out.

Phase 3: Selection: Determine preferred supplier based on in-depth understanding

In this phase, extensive demonstrations of the three best solutions will be executed in accordance with the selection approach. We could have easily added this step in this specific selection process by joining the two or three best scoring diving schools for a day, and then making a definitive choice. However, there was no establishment of a long commitment nor a so-called vendor lock-in. In other words, it would be possible to swap from diving school at any moment. That is the reason why we drove back five hundred meters to participant number 4, after a thorough yet short and unanimous evaluation (see table 1). Time to negotiate!

Diving school no.	Measurement	1	2	3	4	5
Double dive	M	–	+	-/+	++	–
Dive sites	S	–	–	+	++	?
Facilities	C	–	–	+	++	–
Material	C	?	++	?	++	–
Language	W	+	?	+	+	?
‘Cultural fit’		–	–	+	++	-/?
Price		—	—	+	+	++

Table 1: Scores of suppliers on selection criteria

Phase 4: Contracting: Reach agreement with the preferred supplier

The guiding principle was that the choice was made primarily on quality, so the choice for the preferred supplier was evident. However, seen that in our selection process we also used a benchmark on pricing, we knew that, even though participant 4 also scored high, a competing diving school had even keener prices. The approach of the negotiation became: the quality of diving school 4, Nero Sport Diving Center, against the prices of diving school 5. This second visit we were received by Dennis Mohr, who apparently was the owner of Nero Sport. Negotiating about a Best and Final offer with the decision-maker is always a good thing. However, as said, a German diving school. Dennis gave us a tour, showed us how everything was organized (personal equipment downstairs, hired material upstairs, sufficient rinsing tanks and new material, among other things, BCDs with integrated lead – a revelation in terms of comfort!). Everything looks fine, so ‘let’s talk about the price’, provided that we chose a package with a minimum of 24 dives. That what, on beforehand, seemed to be a reasonable plan, to reduce the price with around 10-15%, yielded a friendly though ‘nonnegotiable’ Nein.

Follow-up: Implementation

Overall, my son and I had twelve amazing diving days with Dennis and his team. They fulfilled all expectations in terms of organization and employees, and even superseded some. Partly due to their self-built Neraki, the ship that was used for the double dives. You could clearly tell that the design was made by people that know the demands that divers have for a boat that is used for diving trips.

Take-aways

Clearly, the selecting of a diving school is a process with far less risks than the selection of a complex IT solution. The costs are substantially lower, the vendor lock-in is in this case zero (it is practically possible to switch to another diving school every other day) and the greatest risk is a bad vacation day (unlike being unable to invoice for months or supplying problems by an incorrect storage administration). Having said that, this blog does give some ‘take-aways’ for the selection of solutions and implementation partners

• Determine beforehand what your demands are, including the importance, before you go on the market, so that you know what you are looking for
• Use the selection to get to know suppliers in terms of knowledge, quality of the solution and cultural fit
• Certainly, with these types of standard services, ask a broad group of suppliers, in an early stage, about price indication, so to get a more realistic image of the pricing of this type of service

Note that names of the other diving schools in the selection process have been omitted, due to the partly competition-sensitive (price)information. Whoever is interested in this information can contact me

“And those who were seen dancing were thought to be insane by those who could not hear the music.”

As Nietzsche once so excellently wrote, your own personal perspective is essential. One moment you are amazed by someone making crazy movements, the next moment you are the one hearing the music and you cannot understand why the person standing next to you does not feel the urge to move. To place yourself in someone else’s shoes provides a new perspective. This principle seamlessly fits the concept of service design: thinking from the point of view of your customer, your user, enables you to create more value for them.

User centered design: understanding your customer

Using my background in user centred design, I capture the experiences of users by applying methods such as personas and customer journeys. To do so, you sometimes literally take the position of the user. Consider for instance a day of shadowing an installer in the field to understand his daily routine. Another example is to organize a focus group consisting of shop owners in order to utilize their knowledge to visualize a customer journey. By making these results tangible, you create a shared vision. This allows the entire team to better understand the different types of customers.

Insights by means of service design

We should consider applying these types of methods a natural course of action in IT organization transformation projects: yet, more often than not, we don’t. The impact can be huge, and I have noticed that clients crave the insights that can be obtained by service design. A little while ago, during a workshop for a client, we visualized all involved stakeholders in one image. The process of doing so alone led to interesting discussions: “Strange how group X has not yet been involved in this initiative! And what is the impact of this project for person Y?” Follow up will be to approach these groups, in order for us to truly understand their situation and to not solely build upon assumptions.

In other words, different interests often exist in a situation. The challenge is to apply the right (service design) methods to place yourself in other people’s shoes and simultaneously share your own knowledge and experience. By listening closely, you create a new choreography and together you achieve a better result.

Summer camp, 1954. A group of twelve-year-old boys enjoys an unforgettable holiday. Unsuspectingly, they participate in one of the best-known socio-psychological experiments revolving around group processes. Without having ever met each other, they are divided into two groups that are unaware of each other’s existence. In the first week they perform all sorts of activities that lead to strong group bonding. It isn’t until the second week that the group learns of the other group’s existence. Prejudices and stereotypes towards the others arise and are reinforced by competitions with great rewards. How can two groups with different views of one another work together effectively?

Perception of the partnership

When designing and establishing agile, digital organizations, we notice that organizations increasingly opt to work together with partners. However, more often than not I see that views among these partners towards collaboration differ, and that each party – either consciously or unconsciously – forces its own view on the other parties under the guise of ‘best practices’. The risk arises that one party may not feel heard. There is no real cooperation.

Common vision

In the experiment, the groups of boys are confronted with a broken water supply system. Only by working together as a group this puzzle can be solved. At Anderson MacGyver, we solve the complex puzzle of organizing collaboration among parties by visualizing this on a large poster with all concerned parties together at the same time. This reveals the entire governance, laid down in consultation structures at strategic, tactical, and operational level. In addition, the poster displays guiding principles towards collaboration and a shared vision. The poster itself is the tangible result. At least as important is the process of collaboration. A dialogue is created in which different perspectives and views are exchanged. Together, we come to new solutions.

Think in possibilities, together.

IT separated from business activities, merely supporting, captured in one cost-focused culture: an old-fashioned conception, especially when considering the digital organizations of today in which IT plays an important role in products and services for the end user. Whilst designing such a digital organization it is of utmost importance to pay close attention to the right design principles. Uniformly applying one set of organization principles for the entire organization will no longer suffice: multiple leadership styles and cultures are required for a properly functioning organization. Anderson MacGyver describes this concept using the term ‘multimodality’.

Fit with business activity

The key principle of multimodality is that a suitable digital organization design should be shaped by the characteristics of the business activities on which a digital organization part focuses, by means of applying the Competing Value Framework by Cameron and Quinn (2006).

Types of organization cultures and their characteristics

Anderson MacGyver’s multimodal model distinguishes four modalities of which the digital organization can consist:

• entrepreneurial, short-cycle innovation teams (adhocracy) focused on unique business activities that create external business value
• stability and cost managing teams (hierarchy) focused on commodity business activities, which are necessary, but not distinctive for the organization
• integration teams managing digital data exchange, cohesion, alignment, and reciprocal fit (clan), focused on business activities that are specific and connecting for the organization and her activities
• teams that intelligently adopt market solutions (market) and are capable of quickly utilizing these for generic, but competitive business activities that create business value for the customer

Every year my girlfriend and I go on a diving trip together. We have made ample dives together in various breath-taking destinations, amongst which Egypt, Thailand, and Mexico. Diving is something you always undertake with a buddy and it is of utter importance to completely trust each other. Especially in rather tense situations, such as when you are diving at 30 meters depth, diving in a cave, or are experiencing strong current.

Anderson MacGyver helps IT organizations that want to embark on an adventure with strategic partners to increase the value that is being created for the customer. In strategic partnership it is important that both parties are willing to make long-term investments in the overall collaboration. Additionally, the partnership should benefit both parties.

An example of such an IT organization is our customer Eneco, who has chosen to outsource her datacentre, telephones, and related IT-services to multiple strategic partners. Naturally, all sorts of affairs are captured in contractual agreements, agreed-upon processes, and governance and innovation. Anderson MacGyver has supported all parties during interactive sessions in developing and designing the governance. However, much as diving is not something you can learn from theory, a true partnership in which partners fully trust and rely on each other is not built in a day. It is something that grows over time, an ongoing process. Eneco and her partners realized this as well. But how to develop such a partnership?

Projects are often characterized by tangible results; partnership, however, is a more elusive concept. Means that enable discussion and management of partnership are often not available. Additionally, a partnership is something that often forms and grows at the work floor. Thus, it is essential that involved employees support the collaboration.

Recently we have started an initiative with Eneco and her partners to address partnership. We have determined which specific behaviour is required to enable partnership. Think of behaviours in terms of ownership, transparency, proactivity, and the provision of feedback. By identifying this behaviour, the partnership was made more tangible. The following step is to give meaning to these behaviours. We have chosen a bottom-up approach to do so, in which we ask the employees of both Eneco and the partners for help. For each specific behaviour, we invite them to provide examples from the field on a platform that is accessible for every participant. This way, the employees’ attention is drawn to the specific behaviours and people are able to discuss them and inspire each other. At the same time, the platform is a means for the organization to manage desired behaviour and subsequently let the partnership succeed.

By jointly enabling the partnership to grow, Eneco and partners can and will rely on each other to find a safe way to the water surface even in tense situations.

The closing of a contract between a customer and a supplier is the perfect moment to encapsulate the mutual intentions and goals of both parties. Whether it’s about commodity services or the replacement of a core system, the reciprocal expectations of the supplied services and their benefits should be both explicit and measurable.

However, when it comes to signing the contract, it’s not unusual for people to claim that the specific content of the contract isn’t of significant importance. Everyone wholeheartedly supports what’s been put on paper, yet at the same time people will be aware that at the end of the day it all comes down to the ‘comfortable’ characteristics of the agreement: trust, collaboration, relationship, partnership, compatibility. As for making the partnership succeed, these are generally believed to be the make-or-break aspects. As an effect, the contract’s next destination is the proverbial drawer – only to be picked up again in case of a dispute.

In practice it proves to be difficult to openly discuss affairs that create dissatisfaction. Did we forget to address them? Are we afraid to do so? Are we afraid that that type of attitude is too straight forward? Being open about what can be improved is very important, especially when the intentions are well intended. After all, awareness of the bottlenecks is a necessity if we want to manage them. Both parties benefit from improving the issues!

Indicators

Depending on context, various types and forms of contracts exist. Equally as many metrics provide insight into what is being delivered. Traditional commodity contracts seldom lead to disagreements, since they often consist of simple Service Level types of agreements. Custom-made services are more challenging, for the essence of these contracts is to create business value through the partnership. Ideally, such contracts focus on high-level objectives and specific performance-indicators.

Hence, navigating towards a Service Level Agreement is often the easy way out. This form of reporting and managing often transforms from a method into a goal in itself. This is only logical – it is a comfort zone for both the customer and supplier because of its pleasant, tangible nature. However, performing according to the SLA says little about whether or not the joint business goal was achieved, for which both the customer and the custom service supplier bear responsibility. In particular, legacy suppliers find it difficult to commit to business objectives and intentions.

Prior to the collaboration, its objectives and intentions must be crystal clear. The partnership, the contract, and the indicators upon which the interaction is evaluated should be aligned with these objectives and intentions.

Relax

My opinion is that a contract shouldn’t be left in a drawer, it must be managed. Although this might sound somewhat old-fashioned and bureaucratic, it simply needs to be done. It can, however, be done in a playful, airy way. You can opt for relaxing, inspiring forms of management and reporting, with a clear common goal. By making it fun and useful, contract management finds its way onto the agenda.

No matter the relationship status between customer and supplier, a contract must be consulted from time to time. Even if it’s just to check whether everyone is still in agreement as to its content, whether it still contains the right metrics, and whether delivered services meet what was agreed upon.