Why profit is built on trust

Many IT directors feel that suppliers only want to sell products to meet sales targets, without thought to whether what they have sold is a good fit for the business.

Many IT directors feel that suppliers only want to sell products to meet sales targets, without thought to whether what they have sold is a good fit for the business.

So it is interesting that some firms are seeking to develop closer links with their key suppliers along the lines of the partnerships described in the article How to build a strategic relationship. These strategic partnerships aim to move beyond a purely transactional relationship to one where both supplier and user have something to gain - and something to lose if it fails.

A strategic partnership can free the IT chief from having to deal with hundreds of different suppliers. For example, Halfords' Brian Scott has seen the benefits of his decision to deal with only a handful of key companies on whom he can focus his management time. This has given the suppliers a better understanding of Halfords' IT requirements, enabling them to improve the service and products they provide.

For this approach to work, the supplier must benefit too. BT Global Services' international footprint was boosted in 2002 when it signed up Unilever in a strategic partnership. The international consumer goods firm gave BT people and business in areas of the world where it did not have a strong presence.

A strategic partnership should always be a win-win situation, but it can only succeed if the relationship is built on trust. Unfortunately, the intangible nature of trust makes it something that more measurement-oriented IT chiefs do not feel immediately drawn to.

They should make the effort. Service level agreements are all very well, but they will never be more than a contractual baseline. Only mutual interest and respect can generate real profits for both partners.


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