Procurement – Time To Practice What It Preaches

16/12/09

By Christopher Dawson, Manager, 4C Associates

How to ensure a smooth-running relationship with outsourced suppliers

Performance under most ‘outsource’ supplier relationships is crucially dependent on building and maintaining an effective partnership between buyer and supplier.

It is essential that procurement understands how to achieve such a partnership, and to be able to recognise and identify potential problems before they start to damage contract and relationship performance.

What do I need?
Initial problems can occur at the outset of a relationship — you’ve decided that you need to outsource, but exactly what is it you’re looking for? It sounds obvious, but it is essential...

...to think this through carefully. Establish at the very first point of contact with a supplier exactly what it is you are looking for, both in terms of the relationship between you and the service itself. If you need support to define the full specification, make this one of the first items on the agenda for discussion.

It is also essential at the beginning of any supplier relationship to define the role the supplier will have. This may seem unnecessarily time-consuming when there are so many other facets of contracts and supplier relationships to finalise, but it is important to come to an agreement as to how the supplier will be viewed within an organisation. If a supplier will be providing a service on-site, how will it be presented to the wider company? Will it be bringing a particular kind of expertise and gravitas to the organisation, or will it serve more of a back-office function? Defining the supplier’s relationship in this way will make it easier to present deliverables and outcomes, when required at a later date.

Clearly defined objectives
By the same token, buyers also need to ensure that their suppliers know what they want from the relationship. Whilst... continued on page two >

 

 

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