Managing Multiple Vendors: Don’t Put All Your Eggs in One Basket

Managing Multiple Vendors: Don’t Put All Your Eggs in One Basket

An effective IT strategy embraces multiple vendor relationships. This is important, because it increases efficiency and reduces cost. The challenge is that multiple vendors requires greater effort to manage and maintain a relationship with each one.

 

Tap into multiple knowledge pools

Knowledge is highly valued in the IT industry.

Keeping in touch with your vendors provides an opportunity to stay current with new technologies, learn about innovative trends and use them to strengthen your business model.

A key advantage of working with multiple vendors is you expand your access to information and industry insights.

 

Avoid the complacency trap

Relationships can be compromised when a single IT vendor owns more than 65% of your account. They get complacent and accustomed to your business, and know the cost of leaving can be time consuming and costly.

No single IT vendor should feel entitled to your account. It’s important to achieve a balance between candid relationships and unbiased decision-making to foster competition and to ensure you’re receiving the best expertise available in the market.

 

How do you manage relationships with multiple vendors?

The challenge of engaging multiple IT vendors is building and maintaining tight relationships, which is essential for driving performance.

1) Engage in open dialogue. Transparent communication allows you to discuss expectations, explain business goals and prevent misunderstandings. Candour in relationships allows you to proactively address issues before they escalate into problems.

2) Monitor performance and manage expectations. Metrics are the foundation of accountability. The metrics gathered through a vendor management system help develop operational standards. In achieving consistency, you obtain greater quality, and therefore, extract more out of the relationship.

3) Explore different value-adds. It’s important not to choose vendors solely based on price. Instead, examine the total cost of operations and evaluate the impact that value-adds could have on your relationship.

 

Partnerships for the long-term

Successfully managing multiple IT vendors allows you to extract more value out of your relationships and obtain better control over your account.

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