Right sizing with your own usage data, the repricing threat, and the counter quote built from the admin centre rather than the vendor deck. Three knowledge checks along the way, and 1 clip from a senior cloud advisor.
The presenter in this session is an AI generated avatar. The curriculum and guidance are real, produced by Redress Compliance analysts from our consulting engagements and market network.
This is a taught session, not a talking head. The instructor works through analyst grade slides, and three times the video stops on a question with four options on screen. Pause, commit to an answer, and the next slide explains which option is right and why each of the others is wrong. Once in the session the frame splits and a senior cloud advisor gives the view from inside real Oracle negotiations, and the instructor picks the clip apart when the slides return.
The full narration of this session, section by section, for reading and reference. Guest analyst clips are marked.
Welcome back, session twenty eight of forty. Last session you read the proposal and separated the price decision from the vehicle decision. Today you answer it. And the organising idea of this session is a sequence rather than a technique, because in this part of a Microsoft renewal the order in which you do things decides how much of the value you keep. There is a specific failure I have watched many times: a buyer accepts a commitment based discount in month one, and then in month three completes the right sizing analysis that would have removed fifteen percent of the seats they have now committed to. Nothing about that is anybody acting badly. It happens because commitment is the easiest conversation to start and right sizing is the hardest one to finish. So this session is the order, the reasoning behind it, and the counter quote that comes out of the other end.
Five takeaways. One, why the uplift exists: programmatic volume tiers are gone, so the discount moved from a published tier to the negotiation table and the first quote now starts closer to list. Two, the order matters more than the list: right size, baseline against list, build the alternative, set timing, and trade commitment last. Three, right sizing comes first: cut unused seats so you negotiate the real estate, and E5 right sizing alone returned eight to fourteen percent of the Microsoft 365 envelope against measured consumption. Four, the counter comes from your admin centre rather than the vendor deck, because a counter built from usage evidence is arguable in a way that a counter built from a target percentage is not. Five, what each lever is worth, in directional ranges, so you can sequence by value rather than by whichever conversation is easiest to open.
Why the uplift arrives at all, three consequences of the twenty twenty five change, and the framing to hold is that the discount did not disappear, it moved from a published tier to the negotiation table. No automatic floor: scale alone no longer guarantees a discount, so the buyer who waits for a tier to apply itself now waits through the entire negotiation and signs near the opening number. The first quote moved toward list: the starting point is higher than it used to be, which makes the uplift look larger than the underlying change in your estate, so separate those two before you report anything upward or you will end up defending a number that is not really yours. And the gap widened: removing the programmatic tiers did not reduce discounts for prepared buyers, it widened the gap between prepared and unprepared ones. That sentence reframes the module, because preparation is now the mechanism that produces the rate rather than a way of doing slightly better than a tier.
The order the levers get pulled, evidence first and commercial second. One, right size: remove unused seats before negotiating anything, so that you are negotiating the real estate rather than the quoted one. Two, baseline list: price every SKU against public list, so you can measure the concession you are actually being offered rather than the one described to you. Three, build the alternative: a CSP or MCA quote in writing, and it is the top lever so it needs the weeks you must allow for it. Four, set timing: target a Microsoft quota deadline, which only works once the substance is ready. Five, trade commitment: defensible volume for the final points, and last, because committing early locks the seats you were about to cut. Order matters more than the list itself, and pulling commitment before right sizing is the single most common sequencing error in this entire process.
First check. The account team offers a deeper rate in exchange for a larger Azure and Copilot commitment, before you have right sized. What do you do? A, accept, the rate improvement is concrete and the commitment is manageable. B, right size first, because committing before you cut locks in seats you were about to remove, and over committed Azure and Copilot volume turned into fifteen to thirty percent unused capacity within a year. C, decline any commitment discussion at a renewal. D, accept a smaller commitment as a compromise. Pause it, and ask yourself what happens to the seats you were planning to cut, once those seats are sitting inside a commitment.
The answer is B. Commitment is the last lever precisely because it fixes the size of the estate, and the entire point of right sizing is to change that size first. Accept a commitment on today's numbers and the reduction you were about to make becomes a contractual floor instead of a saving. Over committed Azure and Copilot volume turned into fifteen to thirty percent unused capacity within a year across the renewals reviewed, which is the shortfall shape from session twenty one arriving through a different door. A takes a concrete improvement on a basket you had already decided was too big, which is the trade that feels good in the room and bad in year two. C throws away a lever worth two to six points and is not what the sequence says, because defensible commitment is genuinely valuable at the right moment. D reduces the size of the error without changing its nature. The whole answer here is timing rather than principle.
Right sizing first, five cuts available before you negotiate anything. Seats above the defensible count: quoted counts ran twelve to twenty two percent above what a clean entitlement review could defend, and this is the largest and the easiest, needing only your session twenty six baseline. Tier misallocation: E5 right sizing against measured feature consumption in the previous ninety days returned eight to fourteen percent of the Microsoft 365 envelope. Duplicate add ons: the session thirteen and session twenty five reconciliations, which found duplication on ten to twenty five percent of seats in the security stack alone. Copilot seats without adoption: the module four threshold work, where seats below thirty percent active adoption are negative for most roles. And leavers and orphans, which is the least contentious cut in the entire estate. One caution beside all five: right sizing carries under licensing risk if you cut blindly, so every reduction needs its evidence attached.
Guest analyst The best counter quote I have been involved with did not contain a percentage anywhere in it, and I think that is precisely why it worked. A UK engineering firm, renewal, and the opening proposal was about eleven percent above what they were paying. The procurement director's instinct was to come back with a target, something like we need this flat or better, and I asked him to try something else instead. What we sent was a quote. Not a response to their quote, our own quote, listing exactly what the company intended to buy, line by line, with a quantity beside each one and a short note underneath saying where that quantity came from. Four hundred and twelve seats removed because they had no sign in activity in ninety days, and here is the report. Nine hundred security add ons removed because those users hold E5 which already includes them, and here is the join. Copilot reduced from eighteen hundred to six hundred because these are the roles above the adoption threshold and these are the ones below it, and here is the telemetry. Now what I found genuinely interesting was the response. They did not argue with any of the individual lines, because there was nothing to argue with. It was the customer's own data about the customer's own tenant. The conversation moved almost immediately to rate on the corrected basket, which is exactly where you want it, and it got there in one round instead of four. He told me afterwards it was the first renewal where he had felt like the one being answered.
No percentage anywhere in it, and nothing in it to argue with. Send a quote, not a target. Second check.
Check two. Your counter is a target percentage below the quote. What is wrong with it? A, nothing, a clear target is a strong negotiating position. B, it is unarguable in both directions: nothing supports it, so it can only be met or refused, while a counter built line by line from usage evidence has to be answered on its merits. C, the target should simply be more aggressive. D, targets are fine provided they are benchmarked. Pause it, and as you think, ask yourself what the other side can actually say in response to each of those two kinds of counter.
The answer is B. A percentage target invites exactly one kind of response, which is yes, no, or meet in the middle, and meeting in the middle systematically rewards whoever picked the more extreme opening. A counter built from the admin centre works completely differently: these four hundred seats show no activity in ninety days, these nine hundred hold a component their base plan already includes, these Copilot seats sit below the adoption threshold. Each of those has to be answered individually, and most of them cannot be answered at all, because they are your data about your estate. A treats clarity as strength when the clarity has nothing underneath it. C escalates a position with no foundation, which is how a negotiation turns into a stand off that somebody eventually has to climb down from. D is closest to right and still incomplete: benchmarks tell you what others achieved, your own usage tells you what you should be buying, and only the second survives the question of why.
Building the counter quote, three properties of one that works, and the goal throughout is a document the other side has to answer rather than a number they can decline. It is a basket rather than a percentage: a line by line quote of what you intend to buy, at quantities you can defend, priced at your own rates, which moves the conversation from how much off to what exactly. Every line has a source: admin centre usage, the entitlement baseline, the persona model, the adoption telemetry, so that when a line is questioned you answer with a report rather than an opinion, and that difference is the whole method. And it prices the alternative alongside: the same basket under the other vehicle from session twenty seven, which is the top lever in this module, worth five to twelve points, and costing nothing if the quote is real. The failure mode to avoid is bluffing, because an alternative only works if it is genuine.
What each lever is worth, directional ranges with the risk attached to each. Alternative route: five to twelve points, and the risk is none if the quote is real and everything if it is not. Timing to fiscal year end: three to eight points, and the risk is signing without a walk away option. Defensible commitment: two to six points, risking shelfware from over committing. Unbundling: two to five points, risking the loss of a genuine suite saving where one exists. And right sizing: varies by estate, often the largest of all of them, risking under licensing if you cut blindly. These come from an engagement file rather than a rate card so treat them as directional, and note that they compound when sequenced well. And notice that the largest lever has no fixed number attached, because right sizing is not a concession you win, it is a decision about what you buy, which is exactly why it survives the negotiation.
Last check. You are told that consolidating more spend onto the EA will earn a bigger discount. Is that right? A, yes, bigger spend has always earned deeper discounts. B, not reliably, because discount depth tracked the credibility of the buyer's alternative rather than the size of the spend, and consolidating removes the alternative. C, yes, and it also simplifies administration. D, no, spend level is irrelevant to pricing. Pause it, and ask yourself what consolidating everything onto one agreement does to your ability to credibly leave any part of it.
The answer is B, and this is the piece of common advice that this course most directly disagrees with. Across the renewals advised on, discount depth tracked the credibility of the buyer's alternative rather than the size of the spend, and consolidating everything onto one agreement is precisely the move that removes an alternative. It was far more defensible when programmatic volume tiers existed and scale mechanically produced a rate, and those tiers went in twenty twenty five. So A is reasoning from a world that changed underneath it. C adds a real administrative benefit to a claim that no longer holds, and administrative simplicity has now appeared four times in this course as the justification for a decision nobody priced. D overcorrects, because spend level does affect the range you can reach, it simply no longer produces a discount on its own. Keep a credible route out of at least part of the estate, and keep it priced.
The uplift method, three documents produced in this order, and each one is an input to the next, which is why the order is not negotiable. One, the defensible estate: what you should be buying, line by line, after right sizing, with unused seats removed, tiers corrected, duplicates cleared, and Copilot cut to the adoption evidence. That is the basket, and everything after it is priced against it. Two, the list baseline: every SKU in that basket priced against public list, so you can measure the concession you are being offered rather than the one you are being told about. Three, the counter quote: the basket at your target rates, with the alternative route priced beside it and a source cited on every line. One organisational point decides whether any of this works: procurement owns the commercial thread and IT owns the usage data, not the signature. When those blur, the counter loses either its evidence or its authority.
Session twenty eight, three sentences. One: programmatic volume tiers went in twenty twenty five, so the discount moved to the negotiation table, and the removal widened the gap between prepared and unprepared buyers rather than reducing anybody's rate. Two: the order is right size, baseline against list, build the alternative, set timing, and trade commitment last, because committing before you cut turns the seats you were removing into a contractual floor. Three: counter with a basket rather than a percentage, every line sourced from your own admin centre and the alternative priced beside it, because a counter with evidence has to be answered while a target can simply be declined. Next session is the leverage that makes that counter land, and most of it is about a calendar rather than about an argument.
Homework, about an hour, and this week you build the defensible estate. One, start from the quote: your current quoted or renewing quantities, line by line, in your own spreadsheet rather than theirs. Two, apply the five cuts: undefendable seats, tier misallocation, duplicate add ons, Copilot below threshold, leavers and orphans, one column each so you can see which cut is doing the work. Three, cite every cut: beside each reduction, the report it came from, because a cut without a source will not survive its first challenge and you will be asked. Four, price against list: public list for every remaining line, so you can state your current concession as a number rather than as a feeling. Five, count the gap: quoted basket against defensible basket, as a percentage, and compare it against the twelve to twenty two percent benchmark to see where you sit.
Five reads before next session, all free on redress compliance dot com. First, the EA discount negotiation levers, which carries the seven levers, the order to pull them in, and what each one is worth. Second, auditing your Microsoft licence usage, on how to produce the evidence that every line of your counter cites. Third, benchmarking Microsoft EA discounts, for where your concession sits against comparable deals, which is useful context even though it is not the basis of the counter. Fourth, the EA renewal twelve month playbook, for where in the timeline each of these three documents belongs. And fifth, common Microsoft licensing mistakes, because most of the right sizing cuts in this session start life as one of those. Next session is leverage: competitive tension that is credible, Microsoft's thirtieth of June fiscal year end, and sequencing the renewal against everything else you buy from them. See you there.