Table Of Content6
1^
AResearchProposal
for
HITACHIDATASYSTEMS
COMPETITIVEPROPOSALANALYSIS
Preparedby
INPUT
1280VillaStreet
MountainView,CA94041
415-961-3300
415-961-3966(Fax)
Revision1,August20,1992
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ResearchConsultingProposal-August20,1992
COMPETITIVEPROPOSALANALYSIS
For: HitachiDataSystems
BACKGROUNDANDOBJECTIVES
A. Background
TheU.S.marketforcomputerhardwareandrelatedservicesisincreasinglycompetitive. Hitachi
DataSystems(HDS),apremiersupplierinboththefoilsystemandDASDmarketsegments,
findsitselfinverycompetitivebiddingsituationsinbothofthesemarkets. Fieldfeedback
indicatesthatHitachi'spricingandcompetitors'discountingpracticesarethemajorfactor
contributingtolostbids. Hitachiwouldliketogainamoreobjectiveandquantifiedassessmentof
justwhatfactorsworkforandagainstthemincompetitivesituations,andhasaskedINPIJTto
developafieldresearchproposalthatwouldmeetthefollowingobjectives:
Objectives
Determinethediscriminatingfactorsthatareprimaryinmakingthedifferencebetweena
"win"and"lose"situationforHitachi.
QuantifythedifferencebetweenHitachi'sandthewinningorlosingproposer'sprice.
ProvideanalysisandrecommendationsastowhatHitachi'sstrategyshouldbetoincreaseits
biddingsuccessrate.
SCOPE ' • \.
• Giventhedifficultyofobtainingaccuratecompetitivepricinginformationthroughtraditional
researchtechniques,INPUTproposesthattheinitialengagementbelimitedtoapilotstudy
analyzing20competitivesituationstocertifytheproposedmethodology. Assuming
certificationoftheapproach,afollow-onproposalwillbedevelopedexpandingthesampleto
obtainstatisticallysignificantresults.
• ThesampleforthepilotwillberestrictedtobiddingsituationsthattookplaceintheUnited
StatesandCanada.
• Eventhoughpricingappearstobetheprimaryconsiderationaccordingtofieldsalesfeedback,
INPUTwillattempttodeterminetheinfluenceofotherfactorssuchasbundledservices,
softwareandsupportontheevaluationprocess.
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CompetitiveProposalAnalysis-HitachiDataSystems ^ ^jj
METHODOLOGY
INPUTwillutilizetelephoneinterviewstoobtainthefielddatarequiredtoperformtheproposed
analysis. AsindicatedunderSCOPE,asampleof20companieswillbeinterviewedforthepilot.
INPUTwillattempttobalancethesampleintermsof"won"and"lost"situations,andanticipates
thatitwillrequireaminimumof2interviewspercompanytoobtaintherequiredinformation. To
facilitatetheinterviewprocessHitachiwillprovideINPUTwiththenamesandinitialcontact
pointsofaminimumof50firms(biddingsituations)inwhichadecisionwasreachedbyHitachi's
prospectwithinthelastsixmonths. Totheextentpossiblethebiddingsituationsprovidedshould
bebalancedbetween"wins"and"loses". TheinformationprovidedbyHitachiwouldinclude:
^ • Thenameofthefirm
/ • Nameaddressandtelephonenumberoftheprimarycontactpoint
^ • Namesandtelephonenumbersofanyothercontactsrelevanttothebid(asavailable)
^ • Adescriptionofthepackageofproductsandservicesincludedinthebid
Theactualprojectwillproceedasfollows:
• INPUTwillprepareaninterviewguidedesignedtomeetthestudyobjectivesforreviewwith
Hitachi. Theinterviewguidewillcontainbothopen-endedandstructuredquestions. In
additiontocapturingtheappropriatedemographicinformation,theinterviewguidewillfocus
onthefollowingaspectsoftheprospect/client'sevaluationprocess.
Pre-proposalcommunications
- Proposalcontent(diditmeetclientexpectations)
- Softevaluationcriteria(technical,support,andservice)
Post-proposal/pre-decisionsupport
Pricing
Differentiatorsinthecompetitor'soffering
Theutilizationofoutsideconsultantsintheevaluationprocess
Anattemptwillbemadetoget"hard"dataonactualcompetitiveprices. However,itismore
likelythatintervieweeswillbeinclinedtorespondbycitingpercentagedifferencesbetween
Hitachi'sanditscompetitors'prices.
• HitachiwillreviewtheinterviewguideandINPUTwillmakeanyappropriateadjustmentsto
meetHitachi'srequirements.
Aminimumof10interviewswillbeconductedtodeterminetheviabilityoftheprocess.
INPUT'Sprojectmanagerwillanalyzetheresultsofthispreliminaryinterviewsetandmeet
(0 withHitachitodiscussanyrecommendedchangestoeithertheinterviewguideortheprocess.
Assumingago-ahead,theremaininginterviewswillbeconducted.
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CompetitiveProposalAnalysis-HitachiDataSystems
• INPUTwillpreparea5to10pageanalysisofthepilotresults,andmeetwithHitachito
reviewtheresultsofthepilotstudy.
DELIVERABLES
• Formalinterviewguideforobtainingthefielddatarequiredfortheanalysis
• Mid-projectreviewofresultstodate,includingrecommendationsforchangesintheapproach
orinterviewstructure. Themidpointreviewwillalsoincludeatabulationoftheresultsto
datecross-tabbedbyrespondent,industrygroup,companysize,competitorsinvolvedand
classofproductbid.
• WrittenreportanalyzingthedataobtainedandrecommendationsforchangesHitachican
makeincompetitivesituationstominimizethenumberoflostbids.
• On-sitepresentationofthereportandrecommendations
• Alistidentifyinginterviewees. (Thiswillbedoneonabest-effortsbasis. Intervieweeswillbe
askediftheirnamesmaybegiventoINPUT'Sclient.)
FEESANDSCHEDULES
A. Fees
INPUT'Stotalfeeforthepilotstudyis$J_2,000;$6,000payableuponauthorization. Assuming
thatago-aheadoccursafterthefirstteninterviewshavebeencompleted,theremainingfeeof
$6,000willbedueuponcompletionofthestudyreportandpresentationoftheresultstoHitachi
DataSystems. Intheeventtheprojectisabandonedatthemid-projectreview,thetotalfeeswill
be$6,000plusincidentalexpensesasdescribedbelow.
Otherincidentalcostsassociatedwithfieldresearchstudies(includingtelephone,reproduction,
etc.)willbebilledatcostandareestimatedtobelessthan5%ofthetotalprojectfeeof$12,000.
B. Schedules-INPUTproposesthefollowingscheduleforcompletionoftheproject.
• 9/3/92-PreliminaryReviewofQuestionnaire(Hitachi/INPUT)
• 9/10/92-Questionnairefinalized,interviewprospectsturnedovertoINPUTbyHitachi
• 9/17/92-Midpointprojectreview
• 9/31/92-Presentationofstudyresults
Note: TheabovescheduleassumesprojectauthorizationbyHitachibynolaterthanAugust24,
1992.
PHATAC1.DOC Page4of6 Propertyo/-INPUT
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CompetitiveProposalAnalysis-HitachiDataSystems
QUALIFICATIONS/STAFFING
A. Qualifications
INPUTiswellqualifiedtoassistHitachiDataSystemsinprovidingthedesiredinformation. Asa
leadingmarketresearchandconsultingfirmtotheinformationservicesindustry,EVfPUThas1
yearsofexperienceinanalyzingmarkets,vendorstrategies,userrequirementsandcustomer
satisfaction. Morespecifically,INPUThasconductedbothcustomandsyndicatedfieldresearch
onthepricingstrategiesofprofessionalservicesandotherinformationservicesvendors.
INPUT'Sinternalinterviewingstaffconductsover6,000userinterviewsayearwithinformation
systemsandoperatingexecutivesofbuyingfirms. Theyareknowledgeableabouttheindustry
andwell-trainedinobtainingissueandopinion-relatedinformationinadditiontostatisticaldata.
HitachihasutilizedINPUTinpreviouscustomengagementstoobtainmissioncriticalinformation
ofaproprietarynature.
B. Staffing
ThisengagementwillbeundertheoveralldirectionofR.Dennis(Denny)Wayson,VicePresident
andGeneralManagerofINPUT. SeniorINPUTinterviewerswithsignificantexperienceinthe
mainframecomputerindustrywillbeutilizedtoconducttheinterviewsforthisproject.
CONFIDENTIALITY
Asarequirementformeetingthestudyobjectives,HitachiagreestoprovideINPUTwithcontact
namesfromwhichtodeveloptheinterviewsample. INPUTagreesthatthecontactnamesand
relatedinformationaboutspecificcompetitivesituationsisthesolepropertyofHitachiData
SystemsandmaynotbeusedordisclosedbyINPUTtoanypersonoutsideHitachiDataSystems.
Furthermore,INPUTagreesthattheresultsofthestudyresearchalongwithconclusionsand
recommendationsarethepropertyofHitachiDataSystems,andmaynotbedisclosedor
publishedbyINPUTforanyotherclientthanHitachiDataSystems.
DURATIONOFTHISPROPOSAL'SVALIDITY
Thisproposalwillremainvalidforaperiodof15days.
(Thisspacedeliberatelyleftblank.)
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