Data-Driven Vendor Performance Management
Challenge
With over 2,000 vendors supporting the facilities and real estate department of a global technology company, the client needed an effective way to monitor vendor performance. Previously, communicating vendor performance expectations, understanding a vendor's current performance, and creating a performance improvement plan was completed on an individual basis, which was susceptible to inconsistency, misalignment, and was not trackable.
Solution
Creating trackable Service Level Agreements (SLAs) created a consistent foundation between vendors and the company. SLAs were developed for the top 20 facilities vendors by spend, which represented approximately 80% of the department's overall spend. The creation and agreement of a vendor's SLAs allowed both parties to agree on the performance expectations and consistently measure quality of the services provided. Those metrics were reported on and shared across both parties, supporting quantitative and qualitative dialogue about performance and improvement.
Results
The creation and alignment process of vendor SLAs enabled a mutual understanding for performance requirements and expectations. This mutual understanding and quantitative reporting data enabled this company to have productive and actionable conversations related to performance. This systematic approach to tracking performance also provides the ability to benchmark vendors and support future requests for proposals. Viewing corresponding data trends over time has also allowed the client to identify performance gaps and create process improvement plans, ensuring their vendors are completing the work they agreed to with the quality that is desired.
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