Managing Vendors – Articles by Jim Everett

Tips on managing vendors, skills and competencies required

Mindsets in Business – Part 3

Posted on | December 10, 2010 | CLICK HERE TO COMMENT OR ASK QUESTION

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Making a deal does not always mean making an agreement or a commitment. Many things can come between a deal and a delivery. In this brief article, I look at deals and mindsets on both sides client and vendor.

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Let’s start with how may refer to a deal or agreement, and the words we use when something is not going as expected. Think about the difference in meaning with the choice of the following wording.

I thought we had a deal!
I thought we had an agreement!
I thought we had an understanding!
I thought we had a relationship!
I thought we had this set out in the contract!
I thought we had agreed how this work would be done!
I thought we had worked out the rules!
I thought we had covered all the assumptions!
I thought we had a shared commitment to end results!

Each of these suggests a different mindset, and how the engagement has been set up.

In an earlier article, I wrote about deals, and the role the sales person can play in making a deal. I also wrote about, agreements, assumptions, ego, partnering, and other aspects.

A project leader or vendor manager is responsible for ensuring proper delivery by the vendor, but may not have been part of the making of the deal, or of creating the agreement, or even consulted on it. For this person, it is vital to understand how these different mindsets play into how the work with the vendor is structured and implemented.

And it is not just two different mindsets – one for the client and one for the vendor. Different groups and functions within the client or vendor organization can have their own mindset.

Within the client organization, there can be one mindset for the top level team of negotiators (often representatives from the Sourcing or Procurement group, and from Legal). Then the team of executives of the departments who are outsourcing work may have their own different mindset.

On the vendor side, the Business Development team who bring in the business may have revenue goals, and target clients they need to secure. That creates a deal-oriented mindset. The vendor Legal department has a mindset around creating a tight and comprehensive contract. The delivery teams are focused on getting the job done. In some cases, they may share more of a common mindset with the client’s vendor managers that they do with their own Business Development team.

A key question to ask (or at least bear in mind) is what does the project or engagement mean to each party? For example… Does the vendor see the engagement simply as adding another project where they deploy their methodology, the quality of work is within specified criteria, and the client is part of their revenue stream? And does the the client view the same engagement as a key partnership, where each is committed to doing what it takes to get a particular outcome or excellent quality of work.

This is the first step for a Vendor Manager looking to understand why things are not going as expected, and what may be some of the causes of differences in expectations between client and vendor.

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