Understanding the B2B

market

Purchasing decision

Christophe ARONOWICZ

Leo BOUKOU-POBA

Mathieu DEFARGE EMLV S7

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

SUMMARY

Introduction

Products and services purchased

Selection of a suppliers

Internal processes leading to purchase decisions

Consequences on the organization

Conclusion

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

INTRODUCTION

Focus on 2 different companies that operate on 2 different sectors :– Novacom Associés

– Imnet

Objective :– To determine how purchase decisions are made in

companies

– To determine who the decisive actors are in the purchasing decisions

– To underline key elements of the purchasing decisions in companies

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

PRESENTATION of NOVACOM

Created in 1986

Provides internet, intranet & extranet services to corporations and non profit organizations

Specialized in rich media services :– Rich media platforms

– Rich media web sites

– Immersive websites

– Interactive websites

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

PRESENTATION of IMNET

Created in 1995

A company specialized in :– Consulting and advising activities– System integration

Specialized in various sectors :– Health and social– Banks/insurance– Telecommunication– Automobile industry…

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

PRODUCTS AND SERVICES PURCHASED

Products purchased :– Hardware– Specific software– Furniture

Services purchased or leased:– Uses the services of Akamai to host and manage created

contents– Maintenance on specific software– Hire freelancers depending on the project– Hire actors

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

PRODUCTS AND SERVICES PURCHASED

Products purchased :– Hardware

– Software

– Furniture

Services purchased or leased:– Maintenance on specific hardware

– Additional services included with software

– Hire people related to the consulting activity

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

SELECTION OF SUPPLIERS

Concerning web services the company rely on various criteria :– Reliability of the product and supplier– Quality of additional services provided– Responsiveness– Reputation (determines the level of trustfulness)

Recruitment is done using the following criteria :– Skills, reliability, availability and price– Team work ability is also an important factor

Hardware and software providers are selected using the following criteria – Reliability, availability, delivery capability and price

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

INTERNAL PROCESSES LEADING TO PURCHASE DECISIONS

3 actors involved in the processes

– Technical & managerial team

• Select and evaluate potential candidates and existing offers

– Financial team

• Evaluate the potential candidates and offers

• Give its recommendation to the technical team and to the executive team

– Executive team

• Uses the recommendations from both technical and financial teams

• Has the final decision since companies are dealing with merchandise that cost thousands of Euros

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

CONSEQUENCES ON THE ORGANIZATION

3 tools to deal with supplier problems :

– The SLA (Service Level Agreement)

• part of a service contract where the level of service is formally defined

– The SLM (Service Level Management)

• To negotiate SLA with the customers and to design services in accordance with the agreed service level targets

• To monitor and report on service levels

– The SLOs (Service Level Objectives)

• Are agreed as a means of measuring the performance of the service provider

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

CONSEQUENCES ON THE ORGANIZATION

Delays on delivery– Have impact on the company reliability

– Can induce financial consequences/penalties

Company evaluation & penalties– Occurs when SLA is not fully respected

– Non payment for outsourcing work

Supplier evaluation & penalties– Breach of contracts with its suppliers (in case of SLA

non respected)

– Financial penalties to the suppliers

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

CONCLUSIONS & ANALYSIS

Depending on the company, purchasing decisions involve different actors

For service providers and outsourcers, supplier selection is decisive :

– To respect SLA

– To maintain a level of reliability and reputation

– To be competitive

Internal processes leading to purchase decision vary between companies

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

Websites :

http://www.novacom-groupe.net/

http://www.imnet.fr/

Additionnal sources :

http://www.journaldunet.com/encyclopedie/definition/180/49/20/service_level_agreem

ent.shtml

http://www.journaldunet.com/encyclopedie/definition/181/49/20/service_level_manage

ment.shtml

http://www.journaldunet.com/encyclopedie/definition/182/49/20/garantie_de_temps_d

e_retablissement.shtml

http://wiki.en.it-processmaps.com/index.php/Service_Level_Management

BIBLIOGRAPHY & SOURCES

EMLV S8 – UNDERSTANDING THE B2B MARKET 16/01/2009

THANKS

Special Thanks to :

Novacom Associés

Imnet