Five Keys to Better Vendor Relationships

0

Robb Kerry, Executive Vice President, Chief Credit Officer & Enterprise Risk Officer

Most executives and managers work with vendors—whether you’re a corporate executive managing vendors or the manager of a construction company hiring contractors. You are working with vendors because they bring expertise or experience that you don’t have at your company. And, it’s important to keep good relationships with your vendors, because, like an employee, once you get them trained, the cost of switching is huge. Here are five keys I’ve learned for creating more successful relationships with vendors working for you:

Direct communication. Some companies tip toe around what their goals are with their vendor relationships. They keep things vague, thinking that gives them more power. This is a mistake—clarity and details are your allies in any vendor relationship. The best strategy to communication is to be very clear with your objectives and what you want from working with them. A contract is not always necessary, but setting forth expectations with contractual language will make it easier to address problems or shortcomings in vendor performance.

Vendor performance issues. So how do you handle a vendor that comes up short of your expectations? My suggestion is to speak with them in person or make a phone call if an in-person meeting isn’t feasible. Don’t use email for the initial contact; it’s too easy to misinterpret the meaning of digital communication. Email is a good way to follow up on a phone conversation, however, as it allows you to write down the things that were discussed to keep them fresh in both your minds. Clear, direct communication will benefit you. Be up front about what a resolution looks like from your perspective. Be sure to be fair, though. It won’t help things if you’re unreasonable about your solution and refuse to consider your vendor’s perspective and circumstances.

They’re more than just a vendor; they’re a partner. Thinking of these relationships as partnerships will help you to develop and maintain a mutually beneficial relationship. Rather than merely paying someone to do something you can’t or don’t want to do yourself, you may develop a partnership with someone who can help you to better accomplish your own goals while you help them to accomplish theirs. The culture is to treat our vendors like we do our customers and employees; each of them is critical to our continued success. This approach creates long-term partnerships focused on objectives rather than tasks.

Maintain the relationship. Relationships take work, and good relationships are worth it. Go into the relationship with an understanding of how and how often you will communicate with your partners. Some partnerships merit routine in-person visits. Others can be maintained with less frequent visits or periodic phone calls. These interactions do more than allow you to discuss current performance; they give you a chance to discuss future opportunities. Regular interaction will help to ensure that your vendor relationships will satisfy expectations and accomplish your objectives, not only today but tomorrow.

Long-term relationships work the best. Creating a strong, effective relationship takes a lot of upfront work. Leverage that works by creating long-term relationships that bears fruit for many years. Potential partners normally respond very well when you express interest in a lasting partnership. Occasionally, we’ll find a potential partner who isn’t interested in that type of relationship. They would rather provide services as-is without consideration of a long-term relationship. These situations cause us to pause and reevaluate whether the relationship is truly beneficial. Most times, we continue our search for a partner with a long-haul perspective.

In summary, good vendor partnerships can be much more than a way to get something done that you cannot or do not want to do—they can help both parties to accomplish their respective objectives more efficiently and effectively than they would have otherwise. Clear communication will help to manage expectations and address performance issues along the way. By viewing vendors as partners and aiming for long-term relationships that are worth maintaining, you can maximize your relationships and increase the odds of achieving your objectives year after year.

Share.

About Author

Robb Kerry
Executive Vice President, Chief Credit Officer & Enterprise Risk Officer
EnerBank USA
[email protected]
http://www.enerbank.com

Leave A Reply

five × 4 =