Business System Consultation Center - Our Business System ColumnVol.131 2022.09.01 Takahashi Minoru

An overview of the invoice system and its implications

Thank you for your interest and continued support.
This is Takahashi from the Marketing Plan Research Laboratory.


Suppose a company is procuring a system.


When it comes to deciding who should be the person in charge on the client side,
depending on the company and the project,
they will typically adopt one of the following three scenarios:


① The president (or senior management) negotiates with the system vendor
② Employees (such as in-house IT staff) negotiate with the system vendor
③ External personnel (such as consultants) negotiate with the system vendor


Since scenario ③ above is typically chosen by relatively large clients, we will not discuss it here.


In this column,
we will examine the pros and cons of options ① (the president negotiates) and ② (an employee negotiates),
and the pros and cons of each,
based on my past experience and accounts from peers in the industry.


Advantages of Option ① (President Negotiates)
1. It is easier to build a system that suits the president’s preferences
　　A system is a framework—in other words, the company’s operational rules.
　　Implementing a system will, to a greater or lesser extent,
　　to changes in the rules under which each employee works.
　　The president must decide for himself what changes are acceptable and which are not,
　　　　the president must envision the future of their own company
　　can easily make requests—from the big picture down to the finer details (if they so choose)—
　　is one of the major benefits
　　can be considered one of the major benefits.


2. It is easy to gather information from other CEOs you know
　　It is much easier to engage in external networking
　　in your own mind,
　　or without having a clear understanding of both
　　there will inevitably be a difference
　　there will inevitably be a difference in the quality and quantity of information gathered.


Disadvantages of Option 1 (President Negotiates)
1. It’s simply a hassle
　　Selecting and negotiating a system takes a tremendous amount of time.
　　In some cases, you may need to meet with multiple system vendors
　　compare the pros and cons of each,
　　and sometimes you’ll even be forced to make a decision before everything is fully settled.


2. If you’re not tech-savvy, you’ll be taken advantage of and overcharged
　　Even if presented with a quote that is extremely high compared to market rates,
　　combined with the feeling that “it’s just too much of a hassle,”
　　you tend to give the go-ahead.


② Benefits of (employees handling negotiations)
1. You can build a system that’s easy to operate on a daily basis
　　Systems primarily consist of data input and output,
　　and in most cases, the majority of operating time is spent on daily data entry tasks.
　　Since data entry is typically handled by front-line employees rather than the president,
　　having employees negotiate directly with the system vendor
　　is quite advantageous when it comes to implementing a system that satisfies the front-line staff.


2. Price negotiations may go smoothly
　　In companies with a formal approval process or a culture of double-checking,
　　it is less likely that an unreasonably high quote will be approved.
　　By obtaining multiple quotes, pushing for discounts, and, toward the end of price negotiations,
　　“The　　president insists on a limit of 5 million yen—please lower the price a bit more,”
　　—there’s even such a bold tactic (lol)


② Disadvantages of (Employees Negotiating)
1. A misaligned system may result
　　There are often differences between the president’s and the on-site staff’s perspectives.
　　When the president sees the final reports and output,
　　it’s a gamble whether he’ll think,
　　is a gamble.
　　We sometimes hear stories—which are no laughing matter—
　　which is no laughing matter.


2. Employees tend to cover up their own misconduct
　　From the perspective of Employee A, who was tasked with setting up the system,
　　it creates unnecessary concerns, such as,
　　This creates unnecessary concerns.
　　While this concern is unnecessary from the president’s perspective, it is important to Employee A.
　　As a result, a modest system with little impact is created.


In addition to the above, the president himself anticipates
The pros and cons of negotiating personally
the pros and cons of delegating to employees
Since I believe there are many pros and cons to each of these,
please approach the procurement of the system with the aim of striking the right balance.


That's all, Thank you for reading.

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