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- Five organizations contributed information to assist with the development of this solution set. Due to the sensitivity of the information, all contributors requested confidentiality.
- Organizations are dependent on vendors yet spend little effort managing their performance, resulting in less than optimal results.
- The use of some standard processes can ensure that vendors at least meet expectations.
- The application of additional techniques can move vendors beyond good-enough performance to better or even first-rate.
- Without effective management, vendor performance will remain at standard or deteriorate below standard service. Actively manage vendor performance to motivate them to provide exceptional service.
- Treat the collection of IT vendors as a portfolio requiring regular performance review. Actively manage them all, but pay the most attention to underperformers and develop plans to bring them up to a higher level of service.
- To become a favored client to the vendor, establish internal responsibility for ensuring you have shared targets, build a relationship with liaison staff and their managers, implement an effective performance tracking process, and resolve small issues early to correct potentially chronic problems.
Impact and Result
- Vendor performance metrics provide the common understanding between the organization and the vendor delivering the products and/or services. Measure progress against metrics and set targets for higher performance, or address a vendor's substandard performance before it becomes a larger problem.
- The size of your organization relative to your vendor's and the role of your assigned client-facing representative dictate how you manage the relationship. Cultivate vendor management relationships to leverage negotiations and nurture the client-facing worker who will go above and beyond for you.
- Without sufficient motivation, vendors will generally only meet the agreed expectations. Leverage the drivers of vendor profitability, reputation, and partnership to motivate them to higher performance.
- Manage vendor relationships as a portfolio to achieve a consolidated view of performance highlights and issues, higher customer satisfaction, lower costs, higher quality, and better vendor service.
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