Microsoft Pricing & Negotiation
The Truth About Microsoft Pricing
It is hard to imagine a more prevalent enterprise solution than Microsoft, or a more thoroughly prepared sales force. Planning your demand becomes increasingly important as you grow with a supplier like Microsoft, because once you buy from them, it becomes very difficult to stop. Microsoft products are entrenched in most organizations and customers are unlikely to switch to another solution.
The good news: Microsoft quotes are not set in stone. You can negotiate Microsoft pricing and contract terms to make them lean in your favor. There are nine key elements deal leaders need to gain proficiency in to drive deal success. These nine areas are emphasized in ClearEdge's negotiation framework, the Leverage Management Maturity Model (LM3):
Early Warning System
Risk Assessment & Inspection
Forecast & Modeling
Deal Timeline Development
Deal Option Development
Do we have an organized approach to starting deals on time?
Do we understand all Microsoft contract and business risks?
How much Microsoft product do we need, and when do we need it?
Have we documented a calendar of Microsoft deal-making activities?
How might Microsoft pricing strategy and motivations affect my deal?
What Microsoft deal alternatives or "Plan Bs" do we have?
What information will we protect, and what will we share?
Are executives informed, aligned and participating on the deal?
Are we controlling the story with credible and consistent messages?
Mitigate Risk & Reduce Microsoft Cost
Before the ink is dry on your current deal, Microsoft reps begin using an internal T-36 play book to begin building leverage and positioning products to increase revenue in your next deal. The long runway enables the company to gain insight into your organization and figure out exactly what to sell you and how much more they can charge at renewal time.
Only with diligent planning can Microsoft’s aggressive “T Minus 36” sales methodology be countered. The typical Microsoft renewal requires 9 to 15 months of preparation, and a good rule of thumb is to begin deal-making activities no later than the year 2 True Up. Organizations that give themselves time to properly prepare can proactively engage Microsoft in renewal discussions and can drive the conversations around their needs, instead of allowing Microsoft to run their sales process and the clock.
ClearEdge offers clients direct, hands-on leadership throughout their deal cycle to build leverage, achieve organization alignment, and control Microsoft cost in all major IT categories. Our Microsoft services augment client IT procurement organizations and help professionals create stronger, more productive Microsoft relationships. Transaction Microsoft services have the option to provide direction in deal set-up, team alignment, communication, and strategy, supported by real-time market intelligence and deal analysis.
Microsoft Cost Approach
ClearEdge’s Microsoft services are designed to be light touch and high impact. Instead of disrupting your team, we will augment it, providing the acumen, data, and advice needed to execute your most strategic IT engagements.
Consolidate Microsoft license usage data to assess deployments vs. entitlements
Aggregate key Microsoft contracts for review
Risk & Inspection
Identify key Microsoft pricing and contractual risks in agreements
Build financial demand models to optimize Microsoft costs
Review and optimize compliance gaps
Develop Microsoft deal alternatives
Analyze Microsoft deal options in multi-year financial models
Align stakeholders on Microsoft deal objectives
Outline Microsoft negotiation strengths and weaknesses
Create deal plan and strategic messaging
Execute Microsoft deal strategy
Iterate models through rounds of Microsoft negotiation
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