As digital and business leaders in a rapidly-changing technology and skills landscape, we are all too familiar with the challenge of balancing cost and budget constraints with pressures to further transformation efforts and improve service delivery, speed, and user experience. A key aspect of managing this challenge lies in identifying the opportunities to reduce run costs and fund growth and transformation efforts. 

Wavestone’s cost assessment and benchmarking advisory capability houses deep financial modeling and analysis expertise to help clients get and understand their true cost of service delivery—whether retained or outsourced—and how this cost compares to the current market.

We benchmark costs across internal service delivery and vendor contract pricing based on a proprietary database of retained cost assessments and sourcing advisory engagements. We have the distinction of being the only benchmarker to staff highly-tenured industry advisors on every engagement, as opposed to inexperienced spreadsheet analysts housed in research back offices.

Cost Benefit Assessment

 
Comprehensive Data Analysis
 
 

Metric Database

Our robust database of accurate and actionable data comes from hundreds of client engagements. The data is organized in processable components and consists of protocols, key metrics, service descriptions, and SLAs.

Contract Database

Our contract database consists of software, hardware, and services vendors in the market. It also includes market pricing and discount levels, request for information (RFI) and request for proposal (RFP) responses, and differentiation, capabilities, and references.

Optimization Strategies

Our optimization strategies consist of automation best practices, application portfolio rationalization methodologies, organization, operating model frameworks, cloud migration approaches, and global sourcing strategies.

External Research

In addition to our discovery process and proprietary database, our findings are augmented with statistical intelligence from established sources.

Client Data

We have a client database that includes performance, processes, budgets, actuals, invoices, service contracts, and transformation plans from our previous engagements.


Wavestone’s Expanded Cost Benchmarking Methodology

Our benchmarking models are flexible to account for the uniqueness and practicalities inherent in every business. Each one is crafted from the ground up to give you a full cost assessment of services, not just a budget fly-over, and address “what if” scenarios around changes in service profiles and the corresponding impact on cost structures.

Our cost benchmarking methodology is rooted in six key considerations:

    1. Volume and quality adjustments: We provide normalized comparisons that factor in differences in service quality, responsiveness, and consumption levels.
    2. Service inclusions and exclusions: We provide normalized comparisons that take the exact work elements that are in scope into account. 
    3. Financial and technology parameters: We provide an evaluation of the cost of capital, depreciation, lease vs. buy, volume purchase agreements, the timing of the acquisition, the lifecycle of equipment, and the currency of technology.
    4. Total service costs with management: We provide a total cost-for-service analysis that includes management, governance, and uniqueness in individuals and teams.
    5. Data validated by experience: We provide data validation supplemented with interviews, unlike other firms, which delegate benchmarking to the least experienced consultants who may not have the background to challenge the validity or completeness of data received by a client.
    6. Action-oriented findings: We provide actionable results with each assessment—not just a high/low cost assessment.

Strategy Brief

The IT Cost Optimization Playbook

Optimize IT costs now to weather economic uncertainty.

Featured Expert


  • Featured Expert - Sarthak Brahma

    Sarthak Brahma

    Vice President, Growth

    • Sarthak is a seasoned executive with deep expertise in IT and business process transformation mandates, end-to-end sourcing programs, and outsourced contract optimization.
      Read More

 

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