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A critical element of a mature program on vendor management is the integrated accountability clause in the process of business decision making. When making a decision concerning contract management it must be taken into account either on a centralized setup of a specific corporate task or decentralized in specific business units. Management will have to require business units to come up with their respective justification documents that are thoroughly comprehensive that will be complete enough that those in the top departments will have to think on the requirements.
The decision and process of selection must have a fair degree of flexibility based on critical variables that include project complexity, project risks and overall project cost. When making a final decision, the list below are issues you will want to consider. This process will be effective only when the department heads are involved and given authority in the request and selection of new providers.
1. A thorough description including the reasoning behind the request for a new external provider. This will include the challenges and issues that justify the hiring of an independent service provider.
2. Clear identification of the product or service that is required by the business unit and description on how the product or service will solve the issues and challenges|of how this product will be the solution to the challenges].
3. Description of the importance of the demand to the overall objectives and goals of the business organization.
4. Description and establishment of indicators for the improvement that the service will provide to the current business environment.
5. Justification why the function needs to be done by an outside party.
6. Indication whether an RFP will be required to meet bank standards.
When reviewing and evaluating an application to provide the requested service by a third party provider, you must consider these concerns listed below before a final recommendation and decision is made by the concerned department head:
1. Comprehensive description of the entire range of products or services provided by the external provider.
2. Report and evaluation of past service arrangements by the concerned provider with the company.
3. Summary report on all clients, present or past, who have requested the product from the provider.
4. List of provider references and their complete contact details.
5. Result of technical capability assessment by the companies technical staff if there is one.
6. If there are any lawsuits that are open and pending at this time, a complete description of those.
7. Description of the methodology used in the evaluating the viability of the proposal of the provider.
8. Information on current and pending outsource arrangement by the provider with the company.
9. Approval and explanation of dedication by the provider for knowledge transfer.
10. Confirmation of unilateral revocation of business agreement for non-performance by the provider.
11. Review and affirmation of the proposed agreement by the companys legal department.
As soon as the process of evaluation is completed, the relevant recommendation should be turned into the supervising department so they can deliberate the decision.
The decision and process of selection must have a fair degree of flexibility based on critical variables that include project complexity, project risks and overall project cost. When making a final decision, the list below are issues you will want to consider. This process will be effective only when the department heads are involved and given authority in the request and selection of new providers.
1. A thorough description including the reasoning behind the request for a new external provider. This will include the challenges and issues that justify the hiring of an independent service provider.
2. Clear identification of the product or service that is required by the business unit and description on how the product or service will solve the issues and challenges|of how this product will be the solution to the challenges].
3. Description of the importance of the demand to the overall objectives and goals of the business organization.
4. Description and establishment of indicators for the improvement that the service will provide to the current business environment.
5. Justification why the function needs to be done by an outside party.
6. Indication whether an RFP will be required to meet bank standards.
When reviewing and evaluating an application to provide the requested service by a third party provider, you must consider these concerns listed below before a final recommendation and decision is made by the concerned department head:
1. Comprehensive description of the entire range of products or services provided by the external provider.
2. Report and evaluation of past service arrangements by the concerned provider with the company.
3. Summary report on all clients, present or past, who have requested the product from the provider.
4. List of provider references and their complete contact details.
5. Result of technical capability assessment by the companies technical staff if there is one.
6. If there are any lawsuits that are open and pending at this time, a complete description of those.
7. Description of the methodology used in the evaluating the viability of the proposal of the provider.
8. Information on current and pending outsource arrangement by the provider with the company.
9. Approval and explanation of dedication by the provider for knowledge transfer.
10. Confirmation of unilateral revocation of business agreement for non-performance by the provider.
11. Review and affirmation of the proposed agreement by the companys legal department.
As soon as the process of evaluation is completed, the relevant recommendation should be turned into the supervising department so they can deliberate the decision.
About the Author:
Chuck R Stewart recently signed his staff up to take a vendor management class in order to perfect their skills. He believes that a contract management class will be helpful for the entire staff.
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