Dear Erb,
I’m having a lot of issues with vendor performance, and user departments are coming to me for help. Where do I even start on creating a new program or policy for my organization?
Signed,
Poor Performance Pains
Dear Poor Performance Pains,
Vendor performance issues can be tough, especially when there is no formal process in place to hold suppliers accountable. Creating a vendor performance program is a great step toward improving product and service delivery, reducing risk, and setting clear expectations for all.
To get started, consider the following key areas:
- Define your objectives and clarify what you’re trying to achieve. Are you aiming to reduce contract risk, improve service delivery, or enhance communication? Your goals will shape your program’s design and structure.
- Establish meaningful performance metrics and choose criteria relevant to your contract types. For example, delivery time and product quality may be important for goods, while responsiveness and adherence to service levels may matter more for professional services.
- Set an evaluation schedule and decide how often you’ll review vendor performance, for example, annually, or at the end of a project. High-risk or long-term contracts may require more frequent assessments.
- Identify roles and responsibilities and involve the right stakeholders, typically involving procurement, project leads and contract administrators. Be clear about who collects documentation, who scores performance, and who communicates results.
- Plan and outline a process for dealing with vendor issues. This might include informal feedback, written warnings, performance improvement plans, or suspension. Review your process with your legal counsel and ensure it aligns with trade agreements.
- Communicate clearly with all stakeholders involved. Internally, train staff on how the process works and how it will benefit them. Externally, notify vendors about expectations and how they’ll be evaluated.
Also, don’t forget to check out OPBA’s MemberConnect, a great resource to see how other agencies have built successful programs.
Getting started doesn’t need to be complicated. Focus on setting clear expectations and build from there!
Sincerely,
Erb