Productive relationships

Contract standards could mean a better deal for users, says Ben Booth

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Contract standards could mean a better deal for users, says Ben Booth

 

 

 

Even if there is a preference for in-house provision, the effective management of suppliers is critical to the success of any IT facility. In any company there will inevitably be a network of external providers which will need to be controlled in terms of cost, quality and timeliness.

The ideal is a good supplier working in partnership with the in-house IT team, but this does not always work as it should. Some of the pitfalls are described below, and it is encouraging that the Strategic Supplier Relationship Group (SSRG) has been set up to look at this area.

The SSRG, a consortium of 10 leading user groups, will be launched on 20 April. It is intended that this group will aid communication and add value to the services and purchases made, and will be a sounding board for suppliers to canvas the opinions of their clients.

Although in the longer term we can look forward to the improved relationships to emerge from the SSRG, IT staff on the ground are faced daily with the need to ensure optimal performance from suppliers. The aim must be for a partnership, perhaps even a symbiotic relationship, where suppliers and clients are working together towards a common end. We can do a lot to help this along.

Avoiding uncertainties

The first stage is to agree a common set of goals which can be expressed contractually. Although such co-operation is the ideal, supplier relationships have often got off to a bad start through contractual uncertainties. Smaller organisations will often begin the process of negotiation by using the suppliers' own contract, and many of the more forward-looking suppliers would propose contracts based on a model from suppliers organisation Intellect or the Institute of Purchasing and Supply, or an agreement based on the UK government standard contracts.

All these safeguard suppliers' and purchasers' rights. However, there are still some suppliers that start negotiations with a contract that does not detail what is to be provided, does not provide any remedies for the purchaser in the event things go wrong, and prevents the purchaser from exiting the contract in the event of complete breakdown.

Necessary safeguards will need to be negotiated into the contract, and expert advice may be required to do this - perhaps the SSRG could look at some form of accreditation for contracts which are fairly worded. Purchasers of packaged software may also be faced with a "shrink-wrapped" product that offers no prospect of negotiated changes.

Purchasers must also be wary of contractual clauses that prevent the software or service being transferred to another technical platform, or prevent continued use in the event that the business originally making the purchase is acquired by another. These are the infamous "stiffing" clauses, which Computer Weekly has successfully campaigned against in the past.

Maintaining management

Once a supplier has been engaged, ongoing management is the key to a successful working arrangement. This may take the form of regular meetings, or in some cases, staff from supplier and employing organisations will need to work together on a permanent basis. The value of investing in this process of supplier management cannot be over-stressed.

There are some aspects of the supplier relationship where supplier and purchaser will inevitably be in conflict, where, for instance, the purchaser wants to choose best-of-breed products from a variety of sources, and suppliers want to lock users into their particular products and hinder interoperability. In such circumstances, the record of the supplier in working with other products, or of providing a full set of solutions, will be important. But if we are realistic, we should realise that most suppliers will not willingly allow another onto their turf.

Overall, therefore, there is much we can do to smooth the supplier relationship. Responsible suppliers will not wish to be associated with the more dubious practices. Governments and enterprises will be able to negotiate individually with the larger suppliers, but the majority of users can look to user groups to steer suppliers in the right direction, and the SSRG to improve communication overall. 

Ben Booth is chairman of the BCS Elite group and chief information officer at Mori

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