4 Tips to Get the Most from Your Vendors Through Vendor Management Services

by Bryan Fuller IT Support Services for Austin, TX

Regardless of what industry you are in, vendors play a key role in the success of your business, and effectively managing those vendors allows you to build a strong, mutually beneficial relationship with your suppliers and service providers. Unfortunately, there is a common misconception that vendor management is about negotiating with vendors to get the lowest price point possible; in reality, vendor management involves constantly working with your vendors to come to agreements that will benefit both companies. This requires you to clearly lay out expectations, create easy-to-understand key performance indicators (KPIs), and perform regular check-ins with your vendors. Read on as we take a look at four tips that will help you get the most from your vendors and how third-party vendor management services can help you facilitate these best practices.

Vendor Management Best Practices

There are several key elements that you should consider and implement when managing your vendors. Outlined below are four of these vendor management best practices that will set you up for success.

1. Communication

Communication is always going to be at the forefront of vendor management best practices, as it gives you insight into a vendor’s business outlook, their employees’ view of the contract, and their compliance practices. One of the biggest blunders that you can make is assuming that your vendors automatically share the same business standards and philosophies as you, especially when it comes to data security and management. In fact, one firm’s version of cybersecurity might be entirely different from another’s. To avoid misaligned goals, make an effort to talk to your vendors about each element of your contract. That way, they’ll know that you’re committed to maintaining a valuable relationship that drives positive results for both your organization and theirs.

2. Risk Assessment

Within each vendor relationship segment, you should determine what level of risk there is (trust us, there is always some risk involved in using third-party vendors). This includes looking at one-way risk to your enterprise, one-way risk to the vendor’s business, and structural risk to your contract. While risk does always exist, it doesn’t mean that you will always find trouble with your contract; by forecasting the level of risk that your vendor partnership presents, you are simply preparing for the worst-case scenario.

3. Performance Monitoring

Throughout your partnership with your vendors, you should focus on performance standards that are consistently monitored by both parties. KPIs that are designed to keep both teams in check will give you an accurate picture of how well you and your vendor are measuring up. If one side (or both) falls short of the goals that were previously established, they should be held accountable for their performance. If your objectives and milestones are clearly defined, it should make it easy to see who is holding up their side of the agreement. Moreover, measuring quantitative KPIs now can give you a leg up if you are ever audited in the future.

4. Data Management

According to the Ponemon Institute, third-party vendors account for over half of all data breaches among enterprises in the United States. These days, with most business transactions, comes the exchange of credit card credentials, personal records, and other private information. With most of these items only becoming more and more digitally interwoven, vendors will likely have some level of access to this information – and this is where things get a bit risky. There is a lot at stake, including your organization’s valuable data and reputation, making it critical that you and your vendor are on the same page regarding the safeguards that are put into place to protect your private data. Vendors add a human element that is not governed by your protocols, so you need to outline your own business’ standards and ensure that your vendor is able to match them before working together.

Outsourced Vendor Management Services = A Higher ROI

When you’re trying to get the most out of your vendors, you need to be aware of the fact that your vendors want the exact same thing from you. Consider it a red flag if a vendor is not interested in long-term outcomes that benefit both parties. With that said, many modern-day businesses struggle to maintain a tight relationship with their vendors due to a lack of time and/or resources.

Fortunately, there is a way around this. Meet: third-party vendor management services. Vendor management solutions are aimed at maintaining a strong relationship between both sides by letting a trusted managed services provider (MSP) do the talking. By allowing an MSP to regularly engage with your vendors, you are maintaining an open line of communication, which can prove helpful in times where collaboration and/or performance evaluation is necessary. Enabling these activities makes for smoother, more efficient operations – and we all know what an uptick in efficiency does for your bottom line (hint: it’s a good thing). Therefore, upholding a healthy relationship between you and your vendor no matter the means – even if an MSP is the one facilitating it – can help you maximize your ROI.

Intrigued? Check out Contigo’s vendor management services. With these services, we work with your tech vendors to ensure timely upgrade installations and glitch-free applications for your business. Being able to directly engage with our clients’ vendors also allows us to remedy ISP outages as quickly as possible. In other words, our vendor management solutions contribute to quicker resolutions, better software management, and less downtime for you. Contact us today to learn more.