10 Ways To Navigate Vendor Meetings Before Presenting To Your Boss
A key responsibility for an IT professional is to manage vendor relationships. That means selecting new ones, ensuring that existing vendors are still meeting the organisation’s needs and keeping management informed when vendor relationships need adjusting. What is causing the recent surge in new vendor relationships?
The digital transformation has driven tremendous change, including smart office implementation and the use of “as-a-service” technology. In turn, companies recognise that vendor relationships make these technologies cheaper and more efficient. Some experts have called the flood of new technologies associated with the digital transformation in the Asia-Pacific region its “fourth industrial revolution.” The explosion of cloud-based capabilities in these emerging economies has created tremendous opportunities and demand.
The Tech business is having such a significant impact on Asia-Pacific growth that London’s Financial Times recently released its first ever “FT 1000 High-Growth Companies Asia-Pacific” list. The FT 1000 is best known for its 100 listed companies with the highest market capitalisation on the London Stock Exchange. The addition of the Asia-Pacific list is important because it “shows that technology businesses are leading the way in Asia-Pacific,” explained Business World. “High-growth companies are powering the economies of the world’s fastest-growing region during the so-called Asian Century,” according to the publication.
IT managers are relying more and more on tech vendors’ solutions to keep up. One survey of U.S. companies found that 88 per cent work with at least one vendor and 47 per cent said their company works with more than 10. However, selecting vendors and managing those relationships can be challenging, especially when presenting the justification for the budget to manage. How can you navigate vendor meetings successfully and effectively present the gathered information to management? Implement these ten tips to impress your boss and accomplish your objective.
1. Show Up with Your Needs in Writing
Vendors come prepared to make their case, typically with a pitch in the form of a presentation. They will give you a marketing piece about their services, perhaps including testimonials, levels of service available and estimated costs. Come to the meeting similarly prepared, with a brief description of your needs in writing. This accomplishes three things. First, it shows the vendor you are a serious customer. You are not wasting their time, and you most likely already have budget approval for your organised list. Second, having a written list shows the vendor that you know your needs and that it is futile to waste time trying to sell inapplicable services. Third, this list becomes your outline for presenting to your boss the benefits of selecting a particular vendor, answering the question “does this vendor meet our needs.”
What type of document should you create? Keep it brief. There is no need to draft a full-fledged RFP, as they are too formal, and it takes too long to get to the point. Keep in mind that your goal is to educate the potential vendor. Your business problem should be the key message. Refrain from offering possible solutions. Describe your business need in detail, and let the vendor pitch their most effective solution. For example, you might say, “We are looking for a platform that allows our mobile workforce to communicate and share information effectively.” Include a bulleted “wish list” of what you see that platform enabling employees to do. Ensure that you are gathering this information from colleagues that will be using the technology. What is the problem that you are helping to solve for them?
2. Use Data to Create Evaluation Criteria
The first step to navigating a vendor meeting starts well before the actual meeting. Create a spreadsheet that contains objective evaluation criteria. Data, the secret ingredient to making more measured, fact-based decisions, is plentiful these days. Executives know they make better decisions when data is available. Evaluating your vendor based on hard data is a critical step towards being well-prepared for the after-meeting with your boss.
Data is especially critical when evaluating IT performance. To effectively rate the performance of current systems, you must measure metrics that you can objectively compare to your current or prospective vendor. How much downtime did the organisation experience in the last six months? Did the current vendor perform a root cause analysis (RCA)? What was the cause? How quickly did they respond and get your network back online? Draft your evaluation criteria based on measurable trends that need improvement or that need to remain stable.
3. Remember a Relationship Goes Two-Ways
Just as with any relationship, it doesn’t work if it’s all about you. While you expect a level of commitment from the vendor to support your business, they also expect a level of commitment from you. Seek to understand how your vendor does business. Ask questions that help you understand their side of the business. If you perform duties that belong to the vendor or if you ask them to help with tasks that are not their responsibility, their workflow may experience inefficiencies, which will cause the quality of their services to suffer. This doesn’t mean that prices and services are non-negotiable. Always get competitive bids and talk candidly about what you are paying for.
Understanding their role will help you make the case to your boss as well. After the vendor meeting, you must become the vendor’s advocate towards management. If you’ve gotten to know the company, their mission, their vision and their culture, you’ll be prepared to answer questions like, “why should we pay this fee?”,”what is the benefit of the upgraded service contract?” or “how reliable is their security strategy?” Help management to understand that vendor management prioritises long-term relationships over short-term, marginal cost savings. Regularly changing vendors to save a few dollars will impact performance in the long run and sacrifice quality.
4. Don’t Rely on Yourself Alone
You shouldn’t be the only set of ears representing your organisation in the vendor meeting. Carefully select a group of internal participants, and encourage them to take notes and score the vendor based on the evaluation criteria you drafted. Set up a “post-meeting” discussion to talk about how the vendor scored and the details of the pros and cons that apply in the areas of the software that each member is vested in. Share these combined scores with management. It’s critical that they view the objective opinions of a cross-section of participants.
5. Give the Vendor Feedback
Before meeting with management about your vendor recommendation, give the vendor feedback from your internal review group. This provides the vendor with the
opportunity to respond to any concerns or clear-up any miscommunication. Having this dialogue prior to your management meeting will give you a well-rounded impression of the vendor, their flexibility and their responsiveness, all factors that will help you pitch your recommendation to the boss.
6. Focus on Value, not Price
Management often looks at the bottom line. What will this service cost the company? It’s your job to help them focus on value, not price. The lowest price often yields inferior quality. Enter your vendor meeting with that mindset. Don’t just gather details about cost, but focus on the value received and ask the vendor for this value data. What’s the ROI for their service? How much have other clients saved? For example, if they are selling a CRM, how much does productivity increase? Alternatively, how much did consumer engagement increase, leading to how much revenue? Get numbers for the total cost of ownership, not just the initial cost. Most likely, your vendor will come equipped with this data based on industry trends or their customers. Take this data to your boss to show the value of what you are getting, so that price is not the focal point.
7. Learn More About The Vendor’s Reputation
Reputation speaks volumes, and so your boss will want to know about the reputation of the potential vendor in the industry. How happy are the vendor’s current customers? We live in a world where it’s easy to find reviews and recommendations. Ask your industry peers whom they are using and how it is going. Use your social network connections to ask about vendors in a particular field. Post on an expert forum. For example, if you are looking for marketing software, the CMO forum is a great resource. Check industry lists and publications. Researchers such as Forrester and Gartner often conduct studies and publish research that identifies market leaders.
8. Anticipate Future Growth
Even if the vendor meets your needs today, will they continue to meet them a year from now, or five years from now? What happens if mergers or acquisitions take place? Will the contract transfer? Management will most likely be interested in the big picture, not merely what the vendor will do for you for today. Anticipate where the company is going by gathering data beforehand. Present those possible scenarios to the vendor, and share the responses at your management meeting.
9. Ignore the “Wow Factor.”
IT professionals are often enamoured by the latest and greatest, however, management is more pragmatic. Focus on the metrics, data, measurable results and problems solved during your vendor meeting so you can relay solid reasons for selecting a particular vendor to management.
10. Know Your Audience
Prepare for your vendor meeting by reviewing the audience you’ll be presenting your conclusions to. Your focal points will be much different if you are presenting to your CIO as opposed to a non-technical CEO or CFO. Why are you presenting to management? Is it to add a new vendor or new service? Is it to replace a problem vendor? What relevant information does your audience need? Is it financially-focused? Depending on the pertinent information for your audience, adapt your presentation.
Now you’re ready to conduct a successful vendor meeting and management follow-up meeting. Read more about digital trends you can share with your boss in our ” Guide to Digital Transformation ” e-book. Contact us for more trends affecting your business.