In my first week at the new company, I decided to meet with key stakeholders to gauge what vendors I should focus on first, and what projects to start with. There was one company EVERY single person kept mentioning. For privacy purposes in our story, let’s call this company, Company X. They were our biggest service provider, and also our worst vendor. Any and all performance was abysmal, they constantly violated contract obligations, and the relationship between our companies was non-existent at best, and borderline hostile at worst. 

“If they’re so terrible, and this has lasted for years, why don’t we start looking for a new vendor for these services?” I asked, completely perplexed why this has been ongoing for so long. The person I was talking to shook their head, “We can’t. They have a monopoly on this. There is no other vendor we can work with. The problem is, they refuse to work with us, and there’s nothing that can be done. No one has been able to change that.”

I knew that I had to try. 

I started to try to educate myself about what was going on. I sat in on any meetings that we had with Company X. I quickly realized that even though the vendor was rude and stubborn, the company I was working for, wasn’t being cooperative either. There was one particular conversation…or should I say shouting match (?) that stood out above the rest:

“We hired you to do this work, and you’re not delivering!” my co-worker shouted at Company X.

“We haven’t been receiving any responses from you. We need your team to be onsite” the company X employee responded turning red in the face.

“That’s not our problem. You just need to figure out how to do this on your own” my co-worker responded.

I realized something at that moment. The company that I was working for didn’t realize working with vendors is a two-way street. That it’s just as important for us to do our part to help our vendor. If we don’t help the vendor out (either by responding to calls or emails, sending in documents, or providing clarity and support) there is no way the vendor can do their job well – even if they wanted to (and quite honestly, after attending those meetings I wasn’t sure they did). But, can you blame them here? If someone is yelling at you and rolling their eyes, do you really want to do your best?

If we wanted to see good results from Company X, first we needed to create an environment for them where they wanted to work with us and do their best work. 

Even if Company X is a monopoly, at the end of the day, our team was working with people. People who had feelings, interests, dreams, and ambitions. Maybe they realized that our company wasn’t going to terminate our contract because of Company X’s power. But I can bet they didn’t enjoy working on an account where they weren’t respected and where they couldn’t show their company’s leadership that they were succeeding.

The first thing I decided to do was to re-train our team’s thinking. I took a 2 step approach to this.

1. During every meeting with our vendor, I started asking the question, “what do you need from us to succeed in this?” 
   • Almost every single time this question came up, someone from the vendor side had a request. Every time a request was made, I took a note and worked internally to make sure we deliver on our side. Our team started getting used to the fact that we were doing our part regularly.
2. During quarterly business reviews, I would send out a survey to our team, with one of the questions asking what we need to do internally to improve as a partner to that vendor. This question wasn’t optional, and it wasn’t a question asking IF there’s anything to improve. Every individual had to think and come up with at least one thing that they would improve in this self-assessment.
   • This approach made our internal team think about our communication style, our responsiveness, and what we deliver on our side. This reflectiveness caused many people to admit that we weren’t always open to communication, that we didn’t always share documents in a timely manner, etc… 

After these realizations occurred, people’s reactions started to change. Our team stopped screaming at Company X during meetings. They tried to be more cooperative and started to share information more openly. I could see things starting to improve.

But, I knew that was just the tip of the iceberg. Just like we started to do our part in working with the vendor, I knew the vendor had to meet us halfway, and do their part. We still needed to see their performance scores and delivery times improve. Communication was also still a bit spotty. 

Meetings were held with Company X only if there were any issues to discuss. That was something I realized needed to be changed. We needed to get ahead of an issue before it became a problem. I suggested every team have monthly meetings with their counterparts at Company X. In addition, I also started meeting with our Company X account manager one on one on a monthly basis. We would go over any open tasks, anything that’s come up, and anything either one of us needed to escalate. 

At the beginning of this process (in the first few months when I joined the company), meetings were tense from all sides. But as we started solving issues together, and getting to know one another – casually talking about life or family for the first 5 minutes, discussing a new movie that someone saw, or a new puppy, the tension slowly melted.

Conversations started shifting from pointing fingers to “how can we partner together on this?” We started looking for solutions TOGETHER. 

We all realized that we share similar goals. We want the projects done well and we want them done on time. The friendships that started to develop? Well, that was just a bonus!

After a year of the above methods, Company X went from being our worst vendor to being one of our best. Communication was flawless, requirements were being met well and on time. Soon enough, we started partnering with them more (even on products where they didn’t have a monopoly.) Everyone ended up a winner and everyone was happy.

The partnership between our companies was so successful, that the Company X account team was promoted, given more responsibility, and given the opportunity to work with even larger clients. 

A relationship between a company and a vendor is a partnership. You’re in it together, and it takes both sides to make this work. If something isn’t working, it’s a step by step process to see improvement. Start internally to see what can be improved, and continue onto processes and procedures with the vendor as time goes on. Before you know it, you will see the success you’re hoping for. Just don’t give up!

Data: you either love it or hate it. Very rarely is someone somewhere in between. But when it comes to managing service providers, do you even need to deal with this polarizing topic? If we’re focusing on contracts and relationships, where (and why on earth) does data come in?

Good question! 

Data gives you clarity on the relationship that your company has with your providers. Whether or not you’re meeting or communicating with vendors regularly, data will tell you a few big things: how much money you spend with them, and if they are meeting the performance metrics that have been agreed upon in the contract. If you do meet with vendors consistently, data is the foundation used to discuss performance and take steps to truly start to improve. 

Some companies have this data available for you to peruse at your own time. There are other companies where this isn’t so obvious and you have to get more creative.

I’ve worked at both types of companies:

The first type had data provided for me on a silver platter. We had an internal system built in-house for all our ticket information, contract details, and reporting. All I had to do was click a few buttons on the screen, pull a report, do an analysis – and all performance metrics for our 200+ vendors were there without missing a beat. Reports were sent and scorecards were created. You can bet that I used all this information during my very thorough discussions that were held quarterly. In retrospect, I definitely took this process for granted. I mean, I still had to do the work (analyzing, organizing, putting everything together with a pretty bow during PowerPoint presentations), but I didn’t have to search for it. It was always there for me when I needed it.

But, then I encountered a second type of company.

 “You need data? Why?”
“We don’t track this information. I can’t help you.”
“One of our co-workers may know, ask him.”

These were some of the very real responses I received when trying to figure out how vendor performance metrics were tracked, and if providers are meeting their Service Level Agreements (SLAs).  

I quickly discovered that this wasn’t tracked anywhere. Not properly anyway. There were dozens of spreadsheets spread out amongst at least 5 different teams that had everything except what I really needed to track. Forget about an internal site that housed this for me. This made no sense, how was I supposed to know how vendors were performing? How was I to know, if they met their SLA requirements? How will performance conversations be held, if I didn’t have performance metrics??? 

I had no choice but to get data wherever I could find it, and start the process of convincing everyone around me that housing this data was paramount when it came to growing and improving as a company. 

As we scale, we hire more vendors. But we have to know what our providers are doing, and if they’re doing it well – or else this will quickly affect the product we are releasing into the world.

A bit of a scary thought, isn’t it?

Even if you have a wonderful relationship with your vendor, you still need to own these metrics from your side. You can’t rely on guesses. You also can’t ask the vendor to send you their very own performance metrics (why am I adding this part? Because this was suggested at one point when I was searching for data!) If you ask the vendor to send you their performance data, it’s almost like having a student send their report card to the teacher. It just feels a little backward.

Through my persistence, more and more team leaders started realizing that we need to get more organized and own our data to understand what’s happening. Yes – it took a while, but over time a team was set up to build an internal system to house this information – the SLAs, the contracts, the day to day performance. The stuff you need so you can sit back in your chair, click a few buttons, pull a report, and analyze the results. 

I never thought I’d be writing this post. I mean, when Covid-19 hit, many people (myself included) thought this was going to be over pretty quickly. Even after the company I work for told everyone to work from home back in March, and the city was put under shelter-in-place orders, I was making plans with co-workers and vendors to “see them in April!” Those weren’t just words either. I was actively planning meetings and events with the thought that in 3 weeks time everything will be back to normal. Well, as we all know now – days turned into weeks which turned into months. As I sit here writing this, it’s been 2 months of sheltering-in-place. 

These 2 months have changed my perspective on how I manage my vendors. It’s funny, but even though I’m a “millennial”, I was taught in my first 2 jobs, that all meetings HAVE to be in person. If you’re not meeting in person, you’re wasting your time. 

When all travel was canceled and everyone was instructed to stay home, I realized that I had to change my thinking and expectations. I had to figure out ways to manage my vendors and maintain these relationships from a distance. I learned what many people are starting to see – you can be just as productive when working remotely and you can still continue to connect with each other. You just have to get a little creative.

So, you may be wondering what are my takeaways? What have I started incorporating / doing differently to maintain, and even improve, these business relationships?

1. Use video conferencing for your meetings
   
   A lot of companies have already made the switch to using video conferencing for the ability to share files and presentations, but you might be surprised to know that there are still quite a few companies that conduct their meetings by phone. No screen sharing, no seeing each other’s faces. Many video conferencing services started offering free options for using their products during the pandemic. Take advantage of it! So until we’re all allowed to go to work and meet in person – video conferences make a big difference in how you can communicate with your vendors. But there is a caveat: you have to have your camera on during the meeting. Which brings us to point 2.

2. Turn on your camera during meetings
   
   When we first started doing shelter-in-place, there were many people who wouldn’t turn on their camera. And I get it – you’re home and you don’t want to get ready for the day, as if you’re about to leave the house, when, in reality, you’re not going to leave your couch (or office or dining room table – wherever your designated workspace may be). In fact, in the beginning, I was just as guilty. I didn’t really want people to see me in my sweatshirt and bun, no makeup and glasses. But then I realized, by not turning on our cameras, these meetings were no different than if we were to talk on the phone. You didn’t see the person, you didn’t see their expressions, you weren’t able to make that connection.
   
   By having the camera on, you’re invited into a bit of the person’s life. You can see how a room is decorated, you may hear your co-workers partner in the background, see their kids, or get a glimpse of their dog. You connect with them like never before. 
   
   An in-person meeting, no matter how friendly, never have allowed you to understand the person across the table this way before. We’re living in a whole new era, and we should make the most of it.
   
   I’ve been encouraging everyone to turn on their cameras for our meetings in the last month. I will admit, that I usually give people a heads up a couple of days in advance (so they can feel comfortable with this idea), but it’s been working out very well. This technique feels like you’re still meeting in person, like the bond you have with your coworkers and vendors can continue to grow. But at the same time, you’re social distancing and staying safe.

3. Meet more often
   
   I imagine this may not be the most popular opinion, but hear me out. With video conferencing readily available at our fingertips, we are no longer constrained by flying to see vendors (or vendors seeing us) once or twice a year (granted at this time it’s also not an option…with COVID..so you know – work with what you’ve got). You can set up video conferences more frequently to touch base, see if things are going well and discover what needs to improve. This can strengthen and build your relationship like never before! 

4.  Remote happy hours
   
   After an in-person meeting, many clients and vendors go out for either lunch, dinner, or drinks. This allows you to mingle with everyone in a more casual way, to get to know each other, or to talk business over a cold beer. Now, since that’s no longer an option, I invite you to host a remote happy hour with your vendors. Did you just have a big meeting or a quarterly business review that lasted 1-2 hours? Great! Schedule a remote happy hour afterwards to get a drink and just ask how everyone’s doing. You can still continue to build your relationship in a more casual, friendly way – just like before. You just have to get a bit more creative about it. 

In the past, one of the reasons I was so against remote meetings was because I thought you wouldn’t be able to connect to the person the same way and to build that relationship. But, as we’ve seen from this list, that’s not true – not anymore. 

With this turn of events with so many people working remotely, it’s become easier for people to be more familiar with each other. Lines have been blurred between work and home, as we’ve been invited into each other’s homes.

Connections build relationships. This includes professional relationships with your vendors. These relationships allow you to solve problems, and partner for success. Don’t be afraid of this new familiarity.  Nothing has to change, you can keep doing what you’ve done before (albeit with a few tweaks) and watch your professional relationships blossom!

“Can’t vendors just do what they’re supposed to do? I mean I’m paying for this AND we have a contract!” I’ve heard this phrase or sentiment more times than I can count. When I was tasked to build a VMO (Vendor Management Office) at a company that never had this before, there was resistance from people who never had to work with a Vendor Manager. They never had to talk about their vendors, they never needed to partner with them. They felt that talking about their service provider performance was a waste of their time, and in fact, one person told me this directly to my face. “They just need to do their job”. I lifted my chin and thought to myself challenge accepted. “Alright,” I said, “you want them to do their job?”

Well…

Think of it this way – most people who are hired by a company have performance reviews once or twice a year. You are paid and you have a contract, but you and your manager still sit down to discuss what worked in the last year, what needs to improve, and hopefully, both of you can partner together to get to a win-win situation. Your manager gets the best work they can get out of you, and you, in turn, let your manager know what you need from them.

Well, it’s similar in this case. Just because you paid the vendor and they have a contract that you hope they are honoring, you still have to partner with them to make sure both sides are getting what they want/need out of this. You need to be involved to know if contract SLAs are being met. It’s for your benefit that they are met. If your contract calls for penalizing SLA violations, then it’s also for the vendor’s benefit to not violate any – as well as for their reputation. 

The vendor also needs to feel comfortable having an open discussion with your team and providing feedback. You know the line from Jerry Maguire, “Help me..help you!”? Well, this applies to this situation. Give the vendor what they need so they can do their best work for you. For example, the vendor may need to touch base more frequently, so the project can be completed on time. If they’re building something for you, they may need to double-check the sketches that were provided or suggest better material that will last longer in the future. If they feel they can have these conversations with you, things will go so much smoother, will be completed on time, and everyone will be happy.

Another important factor in managing vendors is strengthening your relationship. The client and the vendor are a partnership that at the end of the day wants to reach the same goal (you want a good product, and quite honestly, most vendors want to give you a good product). To have these conversations, to negotiate new contracts, to continue to improve together, you need to build that foundation and be open. You need to build this partnership between companies.

You may be wondering, well? Did she change that person’s mind??? Did the skeptical individual from the beginning of this story say, “You opened up my eyes to the truth!” How amazing would it be if they have? In reality, they just gruffly left the meeting after we were done. But, I did end up proving how important a vendor management office is after a few months. The individual did eventually say “Even though I have to do more work, I’m starting to see a positive outcome with this process”. The comment made me so happy. The biggest critic was coming around!

So you just found out you have to manage vendors, create a program perhaps, and make sure the relationship with the vendor improves asap? Congratulations!! It’s really a memorable time, full of hope, possibilities, and probably fear.

I remember the first time I ended up having to manage service providers and improve the program (I’ve had bits and pieces of introductions early in my career but not quite as drastic as this…) I was doing data analytics and operations and my manager at the time had some personal conflicts and had to leave the company. Lo and behold, one thing led to another and we had a complete reorg on our team. My role ended up falling under Procurement (you may ask how data analytics falls under Procurement, and to this day I still can’t quite say how this happened!) The team had a couple of hundred vendors that desperately needed to be managed. “Regina, how would you feel about managing our providers? We were thinking you can be involved in RFPs, performance scorecards, and business reviews.” And then it started.

I’ll be perfectly honest, that pivot that I made was the greatest thing. I started doing what I loved. The thing about managing service providers is it’s pretty easy to see results for your work,  the best is when you’re dealing with a troublesome vendor (where relationship is rocky, performance is low, etc…) and after working with them for a few months all aspects improve, and you become a true partnership!

Everyone starts somewhere. No matter what field you’re in, the concept for managing vendors can be expanded through most industries. You’ve got this! Now let’s dive into the details in the next few posts 🙂