Partner Management

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:

• monitor compliance with agreed KPIs and SLAs
• identify performance gaps and areas where they fail to meet expectations
• pre-empt issues that lead to underperformance
• agree on actions needed to deal with performance failures
• benchmark the suppliers' performance against others in the industry
• motivate supplier to improve performance
• prevent complacency, especially in long-term arrangements
• hold suppliers accountable for any failures or breach of agreed terms

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':

• performance - eg efficiency (KPIs) and delivery (SLAs) of contractually agreed services
• incidents - eg events that have negatively impacted your business
• billing - eg accuracy and timeliness of billing, order processing, etc
• quality - eg supplier responsiveness, customer service, supplier knowledge, etc

Sources of data to help you review different aspects of the supplier's performance include:

• supplier scorecards
• staff feedback
• incident reports
• action plans

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!

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:

• Software as a service (SaaS):A software distribution model that allows users to access business applications over the internet without having to download the program onto their devices. SaaS products are typically hosted and updated by the cloud service provider.  Examples include Google Apps, Salesforce, Dropbox, MailChimp 
• Infrastructure as a service (IaaS):A subscription-based service that offers virtual data storage, provisioning and management over the internet, removing the need for organizations to use on-premises hardware or third-party data centers. IaaS cloud vendors are also responsible for maintaining the security, confidentiality and accessibility of all enterprise data under their purview. Examples include  Rackspace, Amazon Web Services (AWS) and Microsoft Azure
• Platform as a service (PaaS):An out-of-the box development platform that allows users to build, run, test and manage custom applications for desktop and mobile devices. Integrating PaaS into an app development workflow can help eliminate the need for dedicated infrastructure. Examples include Apache Stratos, OpenShift, and AWS Elastic Beanstalk.

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:

• Core features and functionality: Modern cloud products offer more than just a single feature or set of capabilities, which is why it’s important to carefully assess your needs before making a purchase. Buying into a large SaaS contract that provides functionality you won’t actually use will only lead to waste and overspending. For example, if you’re looking for a simple way to manage a large fleet of workstations with shared users, a cloud service outfitted with enterprise resource planning tools would only add another layer of complexity. 
• Scalability: One of the biggest advantages of cloud-based services is that they can be scaled up or down to meet your organization’s exact computing, storage and app development needs. For example, if your business secured a lucrative contract that required additional resourcing, you should be able to increase your virtual storage space or adjust your provisioning on demand. The ability to manage growing or diminishing resources is essential to meeting business demands and offering customers a consistent experience. As such, the scalability of your cloud management tools should be a top priority.
• Managed vs. unmanaged: Many cloud management tools offer complete control over core features, while others are primarily overseen by the cloud vendor. Depending on your particular needs, it may be beneficial to choose an unmanaged cloud solution that offers greater personalization or select a managed alternative that leaves back-end tasks to the third-party provider. Before investing in any cloud product, you should make sure it offers the customization you need to seamlessly integrate it into your existing business tools and workflows. 
• Payment models: While most cloud services operate on a subscription-based model, some vendors may require you to make an upfront investment that could stretch your IT budget thin. Business leaders should carefully assess the functionality and anticipated ROI of cloud-management tools before making a purchase decision, as this will help set your organization up for long-term success. Smaller businesses may prefer a pay-as-you-go subscription model, while larger enterprises might be in a better position to absorb upfront costs. 
• Licence models: Not all licence models are created equal. There's consumer level and then there's business level. The consumer levels tend to be a bit cheaper but don't come with as many features, may not have support, and can prevent you from adding new users. The business level ones will often include all of this and will have a degree of scalability depending on how big your business is. Like all solutions it's important to remember that cheaper is not always better.
• Security: Do not over look the fact that you are trusting a lot of company information to something that can be accessed any where in the world via an internet connection. Ease of use does come with it's risks, and you are accountable for any breaches that happen so chose wisely! Look at their password controls, whether MFA is enabled, and how easy it is to remove accounts once people have left. Also, do a Google search to see if they have reported any security incidents at all and how they response (https://haveibeenpwned.com/ is a good resource to use here)

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!