Monitor And Direct
Vendor Work
The type of vendor and work will dictate the details of how
the vendor will be managed. However, here are some useful guidelines:
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Meet on a regular basis to review issues and status. Do this
at both headquarters and local levels. Meet more often if there are problems and
less often if there is not much going on.
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Make the vendor accountable for specific issues early in the
project. This starts to build a pattern for how they will resolve issues. Then
you will be better prepared when a major issue appears.
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Monitor the communications and miscommunications between
their local and headquarters employees. This is a major problem in some
international projects in that when there are communication gaps, people on the
receiving end begin to make assumptions. There may later prove to be incorrect.
Work has to be redone and undone. The consulting bill to you rises. You want as
few middle men as possible in communications.
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Establish a standard method of communications in terms of
reporting, use of voice and e-mail, etc.
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Define how tools and methods are to be employed in the
project. This should be reviewed early in the project and then reviewed on a
periodic basis to ensure that there has been no change.
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Try to have 20% or more of their tasks joint between vendor
staff and employees. This helps to ensure transfer of knowledge.
Implement a vendor score card. A general example is given in Fig. 8.4. Some comments on these
scoring elements are as follows:
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Ratio of local staff to total staff.
This is a good measure of whether they are taking advantage of the local talent
that they have or if they are sending in headquarters people at higher cost.
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Turnover of vendor staff. Some
turnover is acceptable. Too much means that you may be getting “churned.” That
is, the vendor may be moving people in and out of your project to gain
experience.
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Number of active issues over the total
number of issues. If this number is high, then they have many issues and
they are not getting closed fast enough.
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Age of the oldest outstanding major
issue. This is also an indicator of their decision-making abilities.
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Percentage of work complete versus
percentage of budget consumed. This one is obvious, but it is a good
indicator of what it may end up costing you at the end.
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Percentage of tasks that they have that
are joint with your employees. This is a good indicator of collaboration and
transfer of knowledge.
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Percentage of lessons learned meetings in
which they present. This should be high indicating that knowledge is being
transferred.
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Number of instances of detected
miscommunications between their local and head offices. This is subjective,
but is useful in starting to tell you if there is a problem.
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Percentage of future tasks that involve
the vendor and have issues and risk. The higher the percentage, the more in
trouble the project is likely to be.
Of course, you will want to build your own score card from
this. You will then want to adapt it to each vendor. Go over the score card with
the vendor so that they are clear on what is to be measured. Implement the
measurement approach every 2–3 months. If you do it more frequently, it will
take too much work. If you do it less often, then it has little effect.
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