Monday, March 17, 2008

Building a Partnership with the ITES Provider

posted by ShyK at 21:32

Building a partnership with a service provider requires extensive investments of time and management / planning effort on the customers part.

It is no doubt possible for a buyer to continue demonstrating success in a model where the buyer is responsible for strategic & tactical management while provider is responsible for operations. While not the most healthy relationship - it is sustainable, or at least sustainable until external forces do not cause either the buyer or provider to change their business model.

A more healthy relationship is a partnership approach, but this requires nurturing. It might however, be possible to couple the goals of the service provider with that of the buyer with somewhat lesser investment.

Most mature buyers today hold annual IT planning summits where all their service providers are invited. The unit CIOs present their IT roadmap (and budgets) and the providers showcase capabilities and share best-practices. Among other things, this allows the buyers to benefit from the providers learning best practices from each other. Additionally, the providers make suggestions to improve the IT roadmap as they bid for components there-of.

Unfortunately, given the longer term engagements in ITES / BPO - these annual summits by buyers may not apply. This actually moves the responsibly of conducting such summits to the service providers. No doubt the service providers have their own mechanisms to internalize and cross-share with other customers, the best practices that they discover with one customer. However, its possible to gain additional buy in to implement such best practices if the provider conducts a summit for all customers and perhaps for prospects.

While the service provider contributes in terms of bringing in best practices - its for the buyer to share his plans & problem statements with the provider.

It is the responsibility of the Contract Manager or the Sourcing Manager to mandate half-yearly / annual business review meetings requiring participation from the buyer CxO and the provider leadership & consulting team. It should be possible in such meetings to share strategic issues & imperatives - with the provider sharing their experience of resolving such issues.

A few such business review meetings later -- there is automatically sufficient trust established at the management level to work in a win-win partnership mode rather than a provider-vendor mode.

This post inspired by Phil Fersht's write-up on Is your outsourcing vendor really your partner?

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