Most businesses will have some form of partnership arrangement for part of their tech. Whether it's a new relationship or one you've had in place for a while, ongoing management is key.
Regardless of the history in the relationship with your partner, your main focus has to be the ability of the vendor to meet your requirements
This Toolbox Element contains information on the value, and risks, of partnership. It also includes templates and tools that help you manage your existing partners better or chose new ones.
It's designed for leaders who are involved in 3rd party relationship management on behalf of their business
There are many benefits to have the right partner to support your technology
According to FlatWorld Solutions, one of the top benefits of having the right partner is the ability to complete the job for less cost at a higher quality.
In other words, it would cost a lot more if you tried to do it yourself.
Not only that, many partners bring a wealth of knowledge and experience to delivering complex work.
This leads to a higher rate of production over a shorter period of time. When you outsource some of your work, it gives you the opportunity to focus your energy in areas that can better serve your business, such as marketing or product development.
When you outsource you are able to invest your money in other places. You are also able to spend less energy and money on training needs since the outsourced resources already have the necessary knowledge and training and can deliver it at scale.
So it has its benefits.
But it also has its risks and you're still accountable for those.
Partnering doesn't mean set and forget. You still have skin in the game and that means you need to manage your partners and ensure they are working in your best interests.
You need to manage your partners as much as they manage you.
So what should you be doing to manage partners better?
And how to you go about finding new ones if need be?
Read on for more information
A periodic vendor management review should be an essential part of your vendor-management process. A thorough and holistic review is the only way to determine whether you can safely depend on your key vendors — whether they provide data backup, data center services, managed network security services or other key services that support your business.
Advantages of supplier performance reviews
Regular reviews of supplier performance will help you:
If you have an SLA, performance reviews may help you to assess the business/supplier relationship in the most objective way possible.
How to review supplier performance?
Common supplier review evaluation criteria will include categories for suppliers':
Sources of data to help you review different aspects of the supplier's performance include:
If, after the review process, you find that your suppliers are underperforming, service level agreement will usually provide for compensation, often in the form of rebates on monthly service charges.
Frequency of Reviews
We recommend performing an initial review shortly after a new vendor has been onboarded, and then establishing an appropriate schedule for ongoing reviews based on the vendor’s risk level.
As a general rule of thumb for new services, the initial performance review should be performed 90 days after the services are implemented. This will allow enough time to determine how the vendor is performing and tweak specific KPI’s, SLA’s and/or implement action plans.
If the vendor is not performing to desired expectations prior to the 90 days, each occurrence should be documented as an incident and used in the performance review. If the incident creates a risk, it should be addressed immediately with the vendor by creating an action plan with a SMART (specific, measurable, attainable, relevant, time-bound) goal that will be monitored by the Vendor Management Office (VMO).
If you've been working with the vendor for a while and never done a review then call them today and book one in!
A good review follows a structure.
Use our free, editable, template to help you manage the conversation
If you have any questions just give us a call!
So you've decided you need a partner who can better support your environment - either for the first time, or because the one you have is no longer able to meet your needs.
Sure, you could Google companies and build a short list that way. You could talk to your friends and see who they recommend.
Or you could follow a structured process where you specify your requirements and get the vendors to pitch to you. That way you stay in control the whole way through.
Which means you get the outcomes that suit your needs
Where to start
Some companies follow a established procurement process modelled off either an Request for Quote (RFQ) or an A Request for Proposal (RFP).
An RFQ is commonly used when you know what you want but need information on how vendors would meet your requirements and/or how much it will cost. An RFP is used when you know you have a problem but don't know how you want to solve it.
An RFQ is different from an RFP because it focuses almost exclusively on the cost of a specific item or items. By contrast, RFPs are slightly more flexible and allow the vendor to propose creative solutions. RFQ decisions are made primarily based on price while RFPs may be more subjective and consider a number of factors to select the right vendor.
Which one you use will depend on the situation - RFQs work best when you know what you want, while RFPs work where you are looking at options
But, like all processes, neither of them may be the right approach so do find what works for you.
What should you be looking at
Once you have identified possible vendors, you should evaluate each one using the following categories of risk:
Failing to evaluate these could cause big problems down the road if anything happens to your chosen vendor - remember, you cannot outsource accountability.
It is recommended to run reference checks on the vendor. Most companies will happily put you in touch with existing customers to talk about their experiences. If the vendor isn't prepared to do this then it is a big, red flag.
Here's a list of questions you might want to consider asking as part of this process:
Or just go with your own.
Signing up a new partner is a little like hiring a new staff member. Once you've completed all the back ground checks and confirmed they will be coming on board it's time to negotiate terms.
Set some time aside to work with them to set up a Service Level Agreement (SLA). An SLA defines the level of service expected by a customer from a supplier, laying out the metrics by which that service is measured, and the remedies or penalties should the agreed-on service levels not be achieved. This should include:
Remember, you won't be their only customer so there will be some areas you may need to compromise on too, but the purpose of this approach is to ensure that you get the best outcomes for you.
Breaking up can be hard!
If you're switching vendors then there will be certain commitments to the one you leave behind - a lot of which will be written into the contract or SLA. Make sure you honour these and give them plenty of warning that the relationship is ending.
Be honest. Be clear. Be fair. You'll have your reasons for leaving, but you can still be professional about it.
Things might turn sour, but you still need a strong working relationship with them while you transition to the new vendor, and you may still have obligations to them while working out a notice period.
Once they're onboarded, don't forget to setup a regular review with them.
For a structured approach to an RFQ download our free template.
If you have any questions just give us a call!
All this talk of partners is great, but what about in the cloud world?
For the avoidance of doubt we're using cloud to refer to any services delivered over the internet. Typically this is broken into 3 areas:
Cloud providers are still delivering a service - even if it's not the traditional model we'd associate partnership is good.
You're still the customer and, while it may not be possible to run reviews with a company based in New Jersey, you still need to make sure the solution is delivering on your requirements.
What to consider when investing in the cloud:
To help save you time and effort on your next IT integration, consider the following before you invest in a new cloud-based solution:
What about managing cloud providers
Managing cloud providers can be very tricky, especially when they operate in another country (or time zone!). If it's a critical tool to your business then consider using a local 3rd party who is a reseller of the product as your agent. The benefit here is they should be able to provide local support to you when things aren't working for a little bit extra on top of the licence.
If you aren't prepared to do this then perhaps it's time to make a member of your business the subject matter expert on the cloud tool so they can be responsible for it's configuration, use, and internal training.
The important rule here is that you need to manage the service in the way that works for you!
If you have any questions just give us a call!
Not sure where to start? Get in touch and one of our experts will be more than happy to assist.
Breaking technology management down into 12 focus areas, the Tech Tool box provides overview of how you can be managing technology to ensure it is more efficient and effective.
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