Many organizations don’t have the staff, resources, or time for vendor management. Don't panic – this brief guide to the vendor management universe provides easy-to-follow tips and tools that can be incorporated into your process and bring you the maximum results for minimum effort.
Do any of these sound familiar? “Vendor Management?! I don’t have the time or staff for that!” “We don’t have the budget for it.” “Someone else takes care of that…” Or “I’m spread too thin already…I don’t need another project, and I have too much to do.”
Or how about this? “I don’t know where all my IT spend is going, who’s buying what, and our vendors are running the place; I’m over budget and behind on multiple IT projects, and I have contract renewals due.”
You feel like you're rocketing through space, trying to grab all the shiny objects you can, and struggling to complete your mission…and you don’t even have a towel! OK, what’s with the towel, you ask? Catch up on your reading of The Hitchhiker’s Guide to the Galaxy by Douglas Adams, where he explains:
“A towel […] is about the most massively useful thing an interstellar hitchhiker can have. Partly it has great practical value. You can wrap it around you for warmth as you bound across the cold moons of Jaglan Beta; you can lie on it on the brilliant marble-sanded beaches of Santraginus V, inhaling the heady sea vapors; you can sleep under it beneath the stars which shine so redly on the desert world of Kakrafoon; use it to sail a mini raft down the slow heavy River Moth; wet it for use in hand-to-hand-combat; wrap it round your head to ward off noxious fumes or avoid the gaze of the Ravenous Bugblatter Beast of Traal (such a mind-bogglingly stupid animal, it assumes that if you can't see it, it can't see you); you can wave your towel in emergencies as a distress signal, and of course dry yourself off with it if it still seems to be clean enough.”
“Cut it out,” you say. “What does this have to do with vendor management?” Consider this note as your towel to protect you, support you, provide cover when you need it, and act as a hand-to-hand combat tool as you make your way through the vendor management galaxy. But not only do we have towels…we also have a map!
Smaller organizations with limited procurement resources and zero vendor governance spend their time dealing with the next “emergency,” chasing requisitions, purchase orders, contracts, renewals, and putting out fires. They generally do not have time to assemble a vendor management plan, let alone to create a good overview of their most critical vendors. Vendor management is great if you have the staff, reporting tools, and processes to manage it, right? But most IT and procurement organizations do not have that luxury and are left to do their best under the circumstances.
Oh well, I guess we’ll just have to deal with the vendors going around everyone’s back, buying the same products from multiple vendors, working off vendor paper, and paying more, right?
Wait a minute – really? Your internal systems may be a challenging, disparate, disconnected mess and not built for managing vendors, but not having adequate (or any) vendor management built into your IT strategy and procurement operations can have lasting, negative impacts on your business and technology infrastructure, while increasing your costs and risks.
Having different processes for tracking vendor contracts, spending, sourcing, category and project information, and security and risk profiles does you no favors. That said, implement these tools (your “towels”) to get started. Then, you can turn your limited attention to your most critical vendors (or the ones that are most troublesome) and get your organization on a less stressful flight path to a small vendor governance program and work your way to a more formal vendor management initiative.
“Start small, think big, and grow fast.”
You’re busy – we get it and appreciate that you’ve read this far. In this note, we’ll discuss the basics for building a scalable foundation for vendor management and provide the tools to get you started on your vendor management journey…no matter how big or small your organization/department is or how disparate your organization’s systems are.
First, let’s look at how we describe “vendor management.” While it is a broader system of “governance,” as described in Info-Tech Research Group’s “What Is Vendor Management?” note, and specific to each organization’s size and needs, vendor management is a “highly customizable and configurable” unifying foundation for the main “towers of excellence” comprised of the five areas below. These towers represent the foundation for management and will help you get to your destination in one piece with reportable value to show for it.
You are already dealing with the five towers daily, even if you don’t have a vendor management initiative. So, for now, it’s a matter of process and scale to get “vendor management” defined for your organization at lightning speed with minimum effort…and the right tools.
So, let’s take a hypersonic journey through each of the five towers of excellence and see what the “minimum effort for maximum gain” for your organization can be by building a foundation for vendor management, even in a resource-constrained environment. No need to be lost in space when dealing with vendor management…Download the full PDF for your pre-flight checklist.