For an international oil company, Capstan drafted a “Master Services Agreement” under which transaction and project management service providers could be on-boarded quickly in Europe, Asia, Africa and Latin America. The MSA included terms and conditions, service level agreements, and statements of work as well as pricing templates to be implemented globally. The MSA was implemented first in Asia and later in the US and Europe as management rolled it out to the business units in each region.
Working with our alliance partner EquaTerra, we conducted an Opportunity Assessment and analyzed potential savings from outsourcing the facility management, project management and soft services for a pharmaceutical company with a total spend of over $500 million in the U.S. and Europe. We collected data on labor, materials, energy and other costs, and benchmarked those costs against market data by location. We summarized our findings in a business case which projected that savings of 12-15% could be achieved in the near term. We then designed an RFP process that the client’s Sourcing Group is now conducting. Initial provider responses have validated the savings estimates, and the internal facilities group has begun implementing some of the “low hanging fruit” recommendations in our report.
Industry: High Technology Focus: Sourcing Strategy and Contract Negotiations
For a leading high tech company, we reviewed existing preferred provider agreements, interviewed functional leaders and quantified the potential benefits of consolidating functions globally. The client evaluated our report and then asked us to negotiate a global transaction management agreement with one existing provider while a client team conducted a limited RFP process to select new regional providers for project management. The successful negotiation of the transactions contract improved the commission rebate schedule and ensured that the provider would continue to provide strategic consulting services at no charge and improve the lease administration process.
Industry: Aerospace Company Focus: Organization Design, Benchmarking and Sourcing Strategy
Capstan worked with the corporate real estate group of an aerospace giant to evaluate the pros and cons of centralizing global real estate and project management for six operating divisions and 70 million square feet of space. We provided an industry perspective on best practices by summarizing organization models from ten other Fortune 100 global companies including strengths and weaknesses of each model. We helped build consensus for change by quantifying the potential benefits of cross utilization of space and volume discounts on service provider contracts. Next, we studied the market for transaction rebates by benchmarking the proposed contract against eight similar contracts, including the value of consulting services often delivered at little or no cost to major clients. We then assisted in negotiating a transaction management outsourcing contract to support the implementation of the first phase of the reorganization.
Industry: Financial Services Focus: Benchmarking and Sourcing Strategy
For a leading publishing company, we benchmarked the existing global full service contract against other recently negotiated global agreements, and highlighted areas for improvement in contract terms, management fees, transactions rebates/discounts, project management and technology. Later, we conducted a sourcing strategy assessment to help the client decide whether or not to pursue a new outsourced management solution and contract structure. The strategy ultimately led to an RFP process, which we are currently managing for the client with five bidders.
