Grid Infocom Uses Outcome-Based Pricing to Build Trust with TP-DDL

By Anup Varier Sep 30th 2013
Grid Infocom Uses Outcome-Based Pricing to Build Trust with TP-DDL
When Grid Infocom was on the verge of losing a deal for want of a client showcase, it dug deep and leveraged its outcome-based model to reverse its fortunes.

Case File

Key Parties:
Tatapower-ddl, Grid Infocom
Location:
New Delhi
Implementation Time:
8 months
Key Technologies:
SAP Business Communications Management
Post Roi:
Reduced operations and maintenance expenditure by about Rs 80 lakh per annum due to manpower optimization
People Involved:
Arunabha Basu, Chief (Technology& Systems), Tarun Batra, Group Head-GIS (from Tatapower-ddl); Manoj Gupta, Founder and CEO, Maneesh Airen, Project Manager (from Grid Infocom)
Key Vendor:
SAP
Implementation:
Grid Infocom

Introduction :

When Grid Infocom was on the verge of losing a deal for want of a client showcase, it dug deep and leveraged its outcome-based model to reverse its fortunes.

Summary:

When Grid Infocom was on the verge of losing a deal for want of a client showcase, it dug deep and leveraged its outcome-based model to reverse its fortunes.

Even after successfully completing close to 150 projects, if the next customer asks for an outcome-based pricing, we are ready to take it up

In 2010, Tata Power-Delhi Distribution Limited, a joint venture between Tata Power Company and the Government of NCT of Delhi, was looking to cater to the need for consumer-centricity with a world class call-center.

It decided to re-engineer its organizational processes by deploying SAP’s Business Communications Management solution. “We wanted an IVRS-enabled integrated call-center for all types of complaints, which would reduce call handling time, improve call quality, and enable skill-based call routing while also allowing supervisors to monitor and improve a call-center executive’s productivity,” says Arunabha Basu, Chief (Technology & Systems), Tatapower-ddl.

But when it came to deployment, the Rs 6,000 crore-giant hit a roadblock. Tatapower-ddl’s IT governance framework required it to engage a partner that had prior experience in a similar sort of project.

Grid Infocom—among the first few partners of SAP for the solution in India—was involved in the pre-sales activity for this deal and made sure that the necessary licenses were sold to the utility major that distributes electricity in north and north-western parts of Delhi and serves a population of nearly 50 lakh.

As SAP’s BCM was a relatively recent introduction back then, Grid Infocom was the only partner that approached Tatapower-ddl directly. But it was disqualified despite being a trained and certified SAP partner for BCM because it did not have implementation experience with the solution.

Experience is Everything?

It’s hard to blame Tatapower-ddl. That’s because there’s no alternative to experience. You may yearn otherwise, but the process of its accumulation is gradual, and possibly slow, but, the education received is sublime. That’s the lesson Manoj Gupta, founder and CEO, Grid Infocom, used in this deal which he almost lost. “Had we got the deal, it would have been our first implementation, but Tatapower-ddl was concerned about giving it to a partner who had no implementation experience,” recalls Gupta.

Having more pressing engagements at hand, in the form of improving its commercial efficiency, Tatapower-ddl implemented SAP ISU modules (CS, DM, FICA, Billing, UCES and CRM) in April 2011 and discontinued 13 home-grown commercial applications. The SAP BCM project was put on hold for almost two years till the completion of the ISU modules’ implementation as it was to be integrated with these modules. Post this, it became vital for it to upgrade its systems and have a multi-channel contact-center integrated with its CRM.

Tatapower-ddl interacted with SAP’s professional services and asked the company for a quote. “It did a due diligence and found that there was a lot of integration required with third-party applications, and this wasn’t something SAP professional services would take responsibility for,” says Gupta.

Tatapower-ddl realized that SAP’s proposal wasn’t fully aligned to its needs or the budget. “Not only were the various global practices of SAP quoting an astronomical figure for the implementation, but it was also going to use the standard rapid implementation methodology based on templates and replication, which would barely meet 15 percent of our requirements,” says Basu.

During that period, Gupta continued to trawl the market for BCM and conducted a number of demos to gain confidence and deeper understanding of the utility sector. He was in touch with the management at Tatapower-ddl and once again presented its case by showcasing Grid’s technical expertise and domain knowledge. “It would have been a big disaster if we had failed despite working with a big partner. There was less risk involved in taking a chance with a smaller partner,” says Basu.

Even then, there was the risk of going with a partner who had not executed a similar deployment. “That’s when we offered them an outcome-based engagement; where we get paid only if we deliver to their satisfaction,” says Gupta. While this took away most of the risk for Tatapower-ddl, it was a very bold move for Gupta. Grid had much to lose.

Keeping his word

In a domain like BCM, where the customer did not a have a lot of options to choose from, Tatapower-ddl needed some sort of assurance to engage a partner without prior implementation experience. “So, we took the calculated risk and coughed up the money for the implementation and reaffirmed that the company could pay us on successful completion of the project,” says Gupta.

Gupta wasn’t acting out of foolhardiness or sheer desperation. In his career, he has had enough experience on other technology implementations. His experience, combined with the experience of his team, which included experts in business applications, gave Grid an understanding of what not to do. “Most solutions don’t fail because of technology failures, but because the requirements aren’t fully understood, properly mapped out, or well adopted by users,” says Gupta.

With Tatapower-ddl being hesitant to make additional investments in infrastructure without a surety of the project seeing the light of day, it was agreed that the project and consequent payments would be broken up into two phases. “Finally, it was Manoj’s background and overall experience in the field that convinced us to take a chance,” says Basu. It was also decided that only on successful completion of phase-1 would the client be asked to make the investments needed for the full-fledged rollout.

Phase-1 was about forming the call management and basic integration of the sub-systems. A truncated functionality was created. So, when a customer called up Tatapower-ddl contact-center, the call would go through some self-service options, route itself to the relevant customer-care agent, and land up at the executive’s desk with the preliminary information about the customer.

It chose an environment with the least business impact and tested the system for effectiveness in a live environment. “We implemented the telephone links and calls were simulated and routed to the agents who answered live calls,” says Gupta.  A successful rollout of this functionality at the end of two months led to the first payment. Additionally, it encouraged necessary investments on the hardware front to get phase-2 off the block.

Phase-2 was about incorporating additional functionalities and features that Tatapower-ddl wanted, along with a disaster recovery environment. This was started immediately after the procurement of necessary hardware, which took about three months, and was concluded in another five months. Once a strong groundwork was laid during phase-1, the second phase was a breeze. The client was so impressed with the results that along with the remainder of the payment it handed Grid Infocom a contract for annual support and maintenance till the IT team at Tatapower-ddl gained more hand-on experience with the solutions. “It may be a small company but I must admit that it has better knowledge in this domain than most others,” says Basu.

It was almost as if the Tatapower-ddl deal was meant to be Grid Infocom’s lucky break in the BCM space. Soon after this implementation Grid got another deal, and by end of this year it is expected to have completed many more similar implementations. The company, these days, needs to pitch outcome-based pricing less often as most CIOs place confidence in Grid’s work and opt for regular pricing models. “But, even after successfully completing close to 150 projects, if the next customer asks for an outcome-based pricing, we are ready to take it up,” says Gupta. Confidence, it may seem, is a worthy competitor to experience.

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