Clinching The Deal

"It was a mess. We had just made a $2.5 billion acquisition, and we had a number of disparate systems throughout the company, which made upgrades and migrations an absolute nightmare," Sattler says. "Finally, I threw down the gauntlet. I had to have a solution."

After sifting through overpriced offers and quick fixes, Sattler found his solution: Advanced Development Group (ADG), a small systems integrator based in Unionville, Pa., that specializes in Lotus technology. An e-mail-migration solution was deployed that moved more than 6,000 new users to Domino. The solution saved SPX nearly $600,000, and it earned Lotus' Beacon Award as well. "We needed a process to migrate the various e-mail systems in a short period of time to our Notes/Domino system, and they provided a repeatable process that allows us to migrate 100 users a day to our Notes/Domino system," Sattler says.

Despite being a six-person operation, ADG won the deal against larger and more expensive competitors by offering a simple, low-cost and flexible answer to SPX's enterprise problem. And ADG is proof that the reports of the demise of enterprise IT spending have been greatly exaggerated. As tough as the spending environment is at the corporate level, a select number of solution providers are winning deals with large corporate clients by combining competitive pricing, deft technology expertise and a high level of service. Here's how they do it.

Critical Missions
This is SPX's third consecutive year of flat IT budgets, according to Sattler. The company has allocated much of its funds for a large investment in an upgraded security infrastructure, but little else. While security is easy to justify, projects such as e-mail are sometimes taken for granted. Sattler, however, maintains that a better messaging system for his company was crucial.

"E-mail is absolutely a mission-critical application," he says. "When I first came on, we had nine different messaging systems. E-mail just wasn't reliable."

Sattler says his company is now able to manage its entire Notes/Domino system with just five administrators.

Ironically, ADG was recently acquired by Anexinet, a Philadelphia-based systems integrator that collaborated with ADG on the SPX deal. Jeff Fries, who formerly worked for ADG but now serves as vice president of workflow solutions at Anexinet, says the SPX project was a milestone: "Our goal was to be the best Lotus Notes and Domino integrator in the market, so that solution was key for us."

The SPX project proves that security and storage may be the emerging technologies that have the industry buzzing, but often there are other ways to win a corporate account. Many solution providers are finding that enterprise customers aren't always looking for more software or servers.

"Budgets are shifting toward data migration and infrastructure integration," says Jeff Davis, COO of Perficient, an Austin, Texas-based solution provider. "A lot of enterprises still have hodgepodge platforms and infrastructure from different vendors that have been pieced together and simply don't work well."

Take Answerthink, a national IT consultancy, which derives most of its business through enterprise applications from such vendors as Oracle, SAP and Siebel Systems. A large portion of Answerthink's jobs are now centered around consolidating software infrastructure and disparate applications. The solution provider is currently working with an enterprise client to consolidate and combine its SAP business software into one integrated system. "I'm not a best-of-breed applications fan. I don't like integrating applications, and I don't think the customers do, either," says Answerthink managing director Alan Rudolph. "The average Global 2000 company has three different ERP systems. We want to get that down to one."

Deep Expertise
In VARBusiness' 2003 State of Enterprise Spending study, nearly 40 percent of end-user customers surveyed highlighted a VAR's technical expertise as the most important criteria in selecting a solution. Answerthink proved its mettle in its deployment of a large SAP software system for AND 1, a basketball footwear and apparel company, which had replaced its legacy systems and outdated software.

The solution provider engaged the client in late 2001 and beat out the competition, which included larger VARs and smaller boutique shops. Rudolph, who runs the solution provider's business-applications practice, says his company's expertise with enterprise-business applications, and SAP in particular, was the primary reason Answerthink won the complex deal.

"This project was a huge investment for AND 1. The company was basically replacing their entire software infrastructure," Rudolph says. "It probably spent more money than they expected initially."

How did Answerthink seal the deal with AND 1? First, the solution provider was able to demonstrate definitive results and quick ROI through its Business Process Intelligence methodology, which blends technology integration with business-consulting services and best practices for its core competencies in financial, supply-chain and CRM applications. VARBusiness research found 37 percent of customers surveyed said a measurable ROI analysis is the most helpful factor in approving an IT expenditure.

In addition, Answerthink was also offering compelling technology, namely SAP Apparel and Footwear solution, designed specifically for shoe and athletic clothing companies like AND 1. It also deployed mySAP Financials, Human Resources and Product Lifecycle Management apps, among others, so that AND 1 had a true end-to-end software solution. "The great thing about SAP is that we're able to offer a complete solution that can continue to support customers as they grow," says Art Colombo, Answerthink's managing director in charge of the AND 1 project. "Plus, people know SAP is going to be around for a while, so they don't have to worry about their applications becoming obsolete."

Blueprint For Success
Despite the focus on cost-cutting these days, enterprise clients know that cheapest rarely means best. In fact, VARBusiness' survey of enterprise end-user customers showed that just 16 percent say cost is the most important factor in selecting a solution provider. Perficient's Davis says the best approach often is to out-prepare the competition for a specific customer project, and points to his company's experience with Paragon Life as an example.

Paragon Life, an insurance firm and subsidiary of MetLife, wanted a customer self-service Web portal, and Perficient was competing head-to-head against a Microsoft solution provider. Perficient researched Paragon's business model and studied its customers using Perficient's own methodology, dubbed "User-Centered Design," then created an elaborate solution blueprint based on the data.

"Paragon Life knew it wanted an enterprise-level customer portal, so we helped to define the technical requirements by going to the end users and finding out what they wanted," Davis says. "We knew what Paragon's customers wanted before we started the project."

Perficient followed through on the extensive blueprint and prototype solution, building a customer-service platform for the Web and adding such features as an "e-signature" tool that offers users a paperless enrollment application, eliminating the need for lengthy paperwork and actual hard-copy signatures. "It was a tight race, and pricing was a factor," Davis says, "but in the end, we had a better solution design that we could show to the customer."

Sales cycles have clearly elongated to almost torturous lengths and solution providers are often subjected to boot camp-like tests and evaluations. The keys to overcoming such obstacles, as well as fierce competition, Davis says, are diligent preparation and a well-researched solution blueprint. Indeed, VARBusiness research shows the majority of end users surveyed,more than 40 percent,state that prototype solutions are the best way to gain a customer's approval for an IT project.

'X Factors'
Certain intangibles or traits also help solution providers win over enterprise customers. Anexinet often refers to its "X Factor" that helps set the company apart, which includes a unique approach. For one, Anexinet likes to get close to its customers,within five minutes, in most cases. The solution provider sets up temporary branch offices, dubbed "Near-Site Development Centers," in close proximity to its clients to help minimize the drag on operations, improve response times and enhance relationships with customers.

"There's a lot of cheap office space out there, so we'll get a short-term lease for space close to the client," says Diego Calderin, president of Anexinet. "It's all about the customer relationships."

Anexinet also used its Near-Site Development approach with another client recently, setting up a temporary office five minutes away from SEI Investments.

The solution provider constructed an application called "NAV Production" to automate the collection and validation for a Mutual Fund Net Asset Value (NAV). The application, which allows SEI accountants to work in largely paperless virtual environments, was constructed primarily at the Near-Site Development Center. Calderin credits the approach to helping his company reach $10 million in annual sales and expand to more than 50 employees since Anexinet was founded in 2000.

Anexinet also formed a close working relationship with SPX while it was collaborating with ADG on the e-mail migration project, Sattler says. "We worked closely with the Anexinet and ADG guys. They were on site most of the time, and we'd go to happy hour with them," he says. "When the project was wrapped up, we were sorry to see them go."

That's the type of bond every VAR wants.