Organizations can best manage vendor performance by measuring actual performance against a set of metrics agreed upon in advanced with the vendor.
- Establish the key deliverables expected from the vendor, making it clear what responsibility the vendor has and what responsibilities the enterprise has.
- For each deliverable, identify how the enterprise will determine whether the deliverable was completed.
- Identify timing for each deliverable, either with a specific date, a duration relative to a date to be set in the future, or a regular schedule.
- Identify the quality expected of the product and service and how that will be measured or assessed.
This guide helps identify metrics for four general types of products or services, hardware, technical services, software applications and labor services (consulting and software development).