Vendor Relationship Management: 4 Tips for Rolling Out a New Contract

If you’ve recently negotiated a new contract with a vendor, you likely know how important it is to thoughtfully roll out that contract and set the stage for a successful vendor relationship. You probably also know that getting traction with the contract isn’t always as simple as sending out an email that says ‘start buying.’ (Though that would be nice.)

Depending on the breadth and complexity of the vendor’s contract, it may take a bit of work to do the roll out right. But when done the right way, the ROI on that new vendor relationship will be worth the effort.

Here are 4 things I’ve learned about rolling out new contracts and setting the stage for a successful vendor relationship.

1. Prepare Your Buyers for What’s Coming
Communication and expectation setting with internal stakeholders is the biggest weakness I find with most rollouts. You can’t simply change relationships, purchasing processes (and sometimes the underlying systems), and expect to succeed without great communication.

I recommend starting to set expectations 30-60 days in advance. A ‘coming soon’ email or memo, detailing the what, why and when, is an easy and effective way to do this.

Then, as the rollout approaches, get your staff comfortable with any changes to process they may experience. Provide opportunities to ask questions, understand new processes and attend training if required. And after the vendor program is rolled out, provide a process (managed by a point person) for people to get new questions answered and issues resolved.

2. Follow a New Vendor Implementation Plan
Your vendors should have a proven implementation plan they use for new customers. Work with them to refine it to make sure it fits your specific needs. And follow it to a tee.

A good implementation plan should cover pre and post rollout activities like:

• Identifying stakeholders
• Setting up the ordering system and process
• Loading and confirming contracted pricing
• Establishing workflow and business rules
• Agreeing on invoice structure and billing dates
• Developing and implementing training plans for stakeholders

Good vendors have this process down to a science, but know that you can’t plan for everything. Be flexible and prepared to make adjustments.

3. Build Adoption by Building Credibility
Once the program is rolled out, don’t forget to share your progress, successes and problems along the way. Being transparent in the process, especially discussing problems and how you’re resolving them, helps to build credibility and actually make the adoption go much faster and smoother.

4. Set Your First Business Review in Advance
As you begin working with your new vendor, you’ll identify ways to make the program even better. Don’t wait six months or a year to sit down and discuss these ideas. I recommend a 30 day check in, a 90 day refinement meeting and then a more formal, recurring 6 month form business review. These three check points, all within the first six months, will allow you to quickly make improvements and establish the foundation of a strong working relationship with your vendor.

Like anything that requires change, you get out what you put in. When you go to the effort of establishing a new vendor relationship, make sure to invest the time and energy to roll it out in the right way. The ROI will be so worth the effort.
Author:

Job Title: CEO
Organization: Vendor Centric

Tom is the founder and CEO of Vendor Centric, he has been a trusted advisor to nonprofit organizations for 30 years, with a focus on helping them align the right people, processes and systems to mitigate third-party risk and drive more value from third-party contracts and relationships.

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