Vendor Relationships and Quality Control

At the 2016 ACE conference, a panel discussed how good vendor relationships can help you achieve your company’s mission. The panel was:

• Jennifer Cooper-Matlack from New Jersey Manufacturers
• Patricia Walsh from New Jersey Manufacturers
• George Rosch from CCC Information Services
• Laura Werner  from CCC Information Services

Employers, carriers and TPAs partner with vendors to provide services they cannot do in-house. This can often be a roller-coaster ride with peaks and valleys in the relationship. There are five important steps in the vendor management process:

Step One – Set expectations and outcome confirmation 

You want to clearly identify and define customer objectives and make sure the goals are attainable. The vendor needs to be realistic in terms of their capabilities or the customer will ultimately be unsatisfied with the outcomes. The customer also needs to be realistic in terms of their expectations both in terms of performance and pricing.

Step Two – Communication

Communicate clearly with the vendor throughout the relationship. If things are not going as expected this needs to be communicated so adjustments can be made. There should be regularly scheduled meetings to review key performance metrics and these meetings should be at least quarterly if not more frequently. One person at the company needs to own the relationship with the vendor and be the focal point of the communications. On the flip side, the vendor needs to provide a single point of contact who can work within their organization to resolve any issues. Your client should not have to chase down multiple people to work through an issue, which is your responsibility as a vendor.

Step Three – Performance Monitoring

There are two ways to look at this. First, are your employees using the vendor’s products as you intended them to? If they are not using the vendor properly, the desired results will not be achieved. Second, you need to be monitoring the performance of your vendor to ensure they are meeting your key performance metrics. Reaction time to problems is something that should be monitored closely. How quickly does the vendor respond and make changes when problems are identified.

Step Four – Quality Assurance

Audit both your employees and vendors on the quality of the work being performed. Are business processes being followed? Use satisfaction surveys with your customers to ensure the relationship is having the intended impact. Consider bringing in an outside consultant to review the performance and check for leakage or other issues that could impact the success of the partnership.

Step Five – Results

Achieving the intended results is the ultimate goal of the relationship.