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The Value Of Supplier Relationships

If you are an IT director/manager involved in delivering IT services using external vendors then you will fully understand the value of a good outsourcing partner. Over the course of my 10 year career in information technology, I have worked with all sorts of vendors and industry players, and I cannot over emphasize the importance of the customer-vendor relationship. Indeed, the difference between success and failure can come down to the personal bond between the outsourcer's teams and your own.

Here are some valuable tips for getting a good start to a working relationship:

Values: ensure both the vendor organisation and yours operate in line with the same value system. What are the key drivers from a cultural perspective i.e. integrity, innovation, customer centricity. It can be difficult to measure this, but speak to client references and interview key account managers to find out more.

People: At the end of the day, success in delivering IT Projects comes down to the quality of the people from the outsourcer that will be assigned to your project. Interview them with rigour, and if you are going offshore, ensure you are bringing on people who relish the opportunity to give their opinion.

Contracts: The statement of work should be thoroughly checked and signed off by internal stakeholders to set their expectations properly. Furthermore, it is important that the vendor and your internal customers in the organisation have the same expectation of the final outcome. You cannot spend enough time getting the contract right, clarifying deliverables & timelines, and ensuring that communication is clear for all parties.

Advisory: If you are feeling unsure about finding the right partner, don't be afraid to get outside help. There are plenty of people who have been down this path before, and will undoubtedly add value in your organisation.

Processes: If possible, visit their facility and see how dynamic they are. Do they have a cohesive set of processes to follow or are things done more adhoc? How much flexibility do you need when working with a vendor? Sometimes too many processes can hinder productivity and speed. Whether or not you do so in person, you should understand how your supplier manages: disaster recovery, resource onboarding, visa request times if offshoring, change requests, escalations, and governance.

Technical Capability: Get your IT Architects to scrutinize each vendor's technical competencies, and have your programme managers voir dire key personnel to see if they understand overall IT strategy as well as technical detail.

As commented by Mike Dano on Sourcingmag, "All the documents, contracts and business meetings can sometimes get in the way of the most basic part of an IT outsourcing deal - the relationship between you and your vendor. Sometimes that relationship isn't terribly important, but if something comes up to stump your normal day-to-day outsourcing activities, a good working rapport goes a long way toward getting things back on track".

So next time you are signing the dotted line with a new outsourcing partner, find the time to sit down for a dinner or drinks, so that you can call on them to help resolve challenges before contractual clauses are invoked. Having a personal relationship with an account manager, as well as key project resources, can often mean the difference between success and failure when delivering IT services.  

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