What PMs need to know about vendor relationships

Project managers (PMs) have to balance a range of responsibilities when guiding initiatives both internal and external. Externally, one of the most pressing and important duties PMs have is managing vendor relationships. It’s one thing to manage direct reports and employees, but looking after a vendor arrangement, ensuring terms are met and collaborating with partners can be an added challenge.

Vendors often factor into project success, so it’s incumbent on PMs to dedicate attention, effort and resources to ensuring the relationship is as strong as possible. Yet trying to manage outside parties tends to present unique difficulties that project managers must navigate, whether this relates to a software partner whose technology support isn’t up to par or an event partner whose performance has a negative effect on the project.

The key for PMs is in strategizing how to get the most out of their vendor relationships without taking away time from their internal duties. Here are more tips on vendor decision-making and management that project managers can use in their own situations.

Let vendors in on the big picture

Though the level of a vendor’s involvement in a project will range greatly, there’s no role too small to consider in a project’s scope. When working with vendors, PMs need to set the right expectations and have honest conversations with vendors about delivery, quality and other project specifics that relate to their participation. It’s even more beneficial if project managers help vendors realize their part in the grand scheme of the project. Framing a vendor’s involvement in the context of ultimate project success can help an outside party grasp their significance to the project. Without this kind of knowledge or outreach, a vendor may underestimate how much they factor into the project overall. Having a clear picture of all the goals and objectives at play can ensure everyone is on the same page and that vendors are aware of their importance.

Look for, and practice, accountability

One of the main considerations in any vendor decision-making is accountability. Accountability in a partner is a highly desirable quality, but it’s not a one-way street: PMs also have to demonstrate sufficient commitment to accountability on their end.

When judging the accountability of a potential vendor, PMs should do their due diligence and reach out to others in their network or community about any previous experiences with a vendor. They should also ask questions of the vendor themselves on protocols and processes they have in place that ensure quality and timely delivery of assets, services or materials. Likewise, as a sign of good faith, PMs should bring to the table their own evidence of dedication to accountability.

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Get to know the people behind the vendor

While vendor relationships are business agreements, getting to know the actual people that represent the vendor is a crucial step PMs must take. Fostering a relationship with the day-to-day contact at the vendor helps promote the type of communication and engagement that make vendor relationships successful. This need for interaction starts at the first contact and needs to be carried through over the lifetime of a relationship.

One action PMs should consider taking is arranging a regular call or meeting with a vendor. The schedule will take the shape of whatever the project entails (like having weekly calls for a short-term project versus monthly or quarterly calls with a long-term vendor), but the overwhelming value in normalized communication is too great to ignore when managing vendors.

Take time to select vendors

One thing project managers must be cautious about is rushing into a vendor relationship; PMs don’t want to lock a project in with a vendor they haven’t researched or vetted. This process can be a complicated one given the wealth of options PMs often have to choose from when deciding on a vendor, but must be undertaken stringently in order to protect the project and everyone working on it.

Some of the measures PMs should take to ensure careful consideration of vendors include:

● Opening up bidding to vendors, which fosters competition that nets PMs more value from the relationship.
● Researching vendor histories and interviewing representatives on what a prospective relationship might look like and what benefits PMs can gain.
● Negotiating contracts so that expectations are clearly set and the project has something to fall back on.
● Establishing an evaluation system by which vendors can be judged and grant insight to PMs regarding relationships.

Retain some flexibility with vendors

Though it’s important that project scope and vendor contributions be clearly laid out, it’s always a good idea to leave some room for maneuverability, on both the PM and vendor sides. For example, if a project is delayed or a quick fix is needed, PMs might look to their vendor for a patch or solution that wasn’t specified before in a contract. In such cases it helps to not be so rigid as to put off vendors.

Get more education from Brandeis University

Maintaining vendor relationships is an ongoing task nearly every project manager has to handle. Given the important role many such partners play in project success, it’s all too great a responsibility for PMs to not take seriously. When looking to bolster their communication or management skills to improve vendor relationships, interested readers may want to consider earning a Master of Science in Project and Program Management from Brandeis University. The more education and skills a PM can build, the more equipped they will be to competently manage vendors.




Recommended reading:

Tips for Stakeholder Management

Fundamental Elements of a Contract

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