Companies
increasingly rely on vendors to deliver IT products and services. This makes it
crucial that third-party vendors become strong business partners, feel your
pain, and work with you to deliver the best IT possible for your company.
Doing this isn’t
always easy.
Vendors tend to
put their best people on your account when they’re trying to gain your business
and are onboarding you. Then after you are safely in the fold and locked into a
contract, you get shifted to another vendor representative and service begins
to fall off. In other cases, your primary vendor gets acquired by another
vendor. Vendor mergers and acquisitions also mean that service levels from the
vendor usually fall off.
Both events seem
unpredictable and uncontrollable — or are they?
Here are eight
keys to building strong vendor relationships:
1. Always seek
outstanding front-line support
Before you sign a
contract with your vendor, reserve the right to interview and participate in
the selection of vendor account representatives and service support. Ideally,
you should have an opportunity to meet the individuals who will help you with
your install and then be your regular account and service “point people” after
you are implemented. In an addendum to your contract, the right to accept and
reject account and service representatives should be in writing.
2. Communicate
regularly with the vendor
Vendor
communications should be occurring at least weekly so your organization can
review daily performance, projects, etc., that you are undertaking with the
vendor. This keeps your organization on the vendor’s radar, and you are more
likely to receive prompt vendor attention when issues arise. As part of vendor
communications, you should also have an understanding with the vendor of how
issues should be escalated in the vendor organization if they can’t be resolved
quickly.
3. Actively
participate in vendor client organizations
Third party
vendors make decisions about service and product enhancements based upon what
their clients tell them that they want. If you want to ensure that future
vendor investments into products and services remain aligned with your own organization’s
goals, you should make it a point to participate regularly in vendor panels,
user groups, conferences, and forums. This gives you a voice and an opportunity
to propose enhancements to vendor products and services that will benefit your
organization.
4. Define and revisit
SLAs
Service level
agreements (SLAs) for performance, security, support, etc., should be clearly
agreed upon and documented with vendors. More than likely, this will require an
addendum to the standard vendor contract. It should also be agreed to and in
writing that SLAs will be reviewed for performance and if necessary, adjusted
between you and your vendor on an annual basis.
5. Address
deconversion at the time that you negotiate your contract
No one likes the
idea of having to leave a vendor, but if it becomes necessary and you want to
move on to someone else, having something in writing matters. Why? Because
vendors don’t like to lose business to competitors. The “losing” vendor can
often drag its feet when a deconversion (and cooperation with the new vendor)
are needed for you to make your move. To avoid situations like this, you should
address the possibility of deconversion and develop a written SLA in your
initial contract with the vendor.
6. Request
visibility of vendor IT audits on an annual basis
If you are
outsourcing critical IT to a vendor, you want to ensure that the vendor’s
security and governance practices are in alignment with your own. A good way to
do this is to include regular reviews of vendor IT audits as a part of your
contractual SLAs. If you encounter a vendor that hasn’t had an IT audit in the
last 18 months, it might be time to consider another vendor.
7. Agree with
your vendor on hiring practices
It’s not uncommon
for vendors to poach key people form their client organizations, especially
when those people possess unique knowledge about a certain industry vertical
that the vendor wants. Conversely, clients like to poach vendor support and
applications personnel who can edify their organizational knowledge bases.
Employees have the
right to seek employment where they wish, but it’s still a good idea to have an
understanding with your vendor if personnel move between your organizations.
Often, this takes the shape of the hiring company paying a finder’s fee to the
company losing the employee.
8. Protect
yourself from vendor mergers and acquisitions
There have been
several instances during my IT career when excellent vendors were acquired by
larger vendors and service levels immediately dropped. We had protection,
because we always had a clause in our contract that if there were a change of
management control with the vendor, we would have the right to void the
contract.
What to Read
Next
What to Do When a Vendor Goes Out
of Business
How to Negotiate with Software Providers for the Best
2021 Deals
How
to Get a Stronger Grip on Contract and Vendor Management
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