During the course of my LinkedIn Q&A series on various aspects of Vested, I discussed exactly what I mean when I talk about the Pony, which is a cornerstone of achieving a win-win business relationship that creates and shares value.

Briefly, the Pony is the quantified difference in value between today’s current process and the future, optimized process.

For many strategic relationships, the goal of working with a supplier should not be to simply outsource the work, but to find a partner that will help transform how the work is done in a way that optimizes for both cost and service improvement, that is to find the Pony. This happens when a company achieves its Desired Outcomes.

I want to send some kudos out for an interesting comment on the Pony from Rakesh Agrawal, who is Aricent’s AVP, strategic deals, Europe.

He wrote about the way a left-brain would define the Pony.

Here’s the equation he devised:

PONY = TOM (TBO2 – TCO2) – COM (TBO1 – TCO1)

Where:
PONY: Size of the smile/prize
TOM: Target Operating Model
COM: Current Operating Model
TBO: Total Benefits of Ownership
TCO: Total Costs of Ownership

[In this setup the Operating Model = (People + Process + Technology + Third Parties + Data + Capital + Governance) in scope.]

A person who is “left-brained” is often said to be more logical, analytical, and objective, while a person who is “right-brained” is said to be more intuitive, thoughtful, and subjective.

Personally, it’s great to see a left-brain at work, applying some scientific, logical and objective analysis to the Pony, which is sort of a right-brain concept! Thanks, Rakesh!

Image: left-brain-right-brain by vaXzine via Flickr CC