Supplier selection: the price of failure
Working with partners and third parties can be essential to bring additional capabilities, expertise and capacity into your organisation. But the cost of selecting the wrong ones can be high.
Not only can you lose out in hard cash terms, but soured relationships, delays and lost management time can severely hamper you realising planned benefits.
Based upon our experience of helping many organisations select and then manage suppliers over time, The Berkeley Partnership can help you avoid some key pain points.
Supplier selection: be clear on your rationale for using partners
We can create a partner sourcing strategy to help you identify and confirm the broader business outcomes you want to achieve plus what a partner can bring to you in that context. Too often businesses rush into selection without working this through, and end up with the wrong partner or waste time in a long, protracted selection process. With digital and agile development, it’s all too easy to quickly end up with a complex partner ecosystem before you’ve really set the direction, and agreed how you’ll get there.
Supplier selection: a tailored selection process to test key outcomes
Many organisations don’t deviate from the standard approach of a paper-driven Request for Information (RFI) followed by a paper-heavy competitive Request for Quote (RFQ) or Proposal (RFP), often involving partners already known to them.
The Berkeley Partnership can help you develop and implement a more constructive and discerning selection process by defining and reviewing proposal tender documents including Statements of Work (SOW). This will allow would-be suppliers to demonstrate key skills of importance to you.
Success is often mistakenly defined in terms of what percentage a supplier was beaten down on their commercials. Whilst overpaying and commercial naivety should be avoided, there needs to be careful consideration of the cost-quality relationship.
Berkeley were professional, committed, and really gave this big programme the professional structure it needed. Their consultant was very well respected and appreciated by everyone he worked with in the markets. Also personally, he truly felt like my business partner. Well done.”
Global Sales Transformation Business Lead, a consumer goods company
Supplier selection: align commercials, relationships and delivery for results
Aggressive upfront negotiation can result in losing the partners’ ‘A-team’ people or driving them to recover margin elsewhere. We can help you contract through ‘story point’ or iteration for agile software development, rather than fixed price. This will enable proper scope, priority and sequence decisions to be made during the project without re-working commercials.
Supplier selection: working together
Where multiple partners need to work together, we help you invest time up-front to agree common objectives and ways of working by defining a partner management strategy and vendor management framework. This undoubtedly will reduce the risk of later ‘finger pointing’ and misunderstandings. The Berkeley Partnership has seen weeks and even months wasted as a result of not spending a couple of days early on doing this. We can also help structure commercial frameworks and support partner negotiations to incentivise partners to work and collaborate together to achieve overall objectives.
Supplier selection: partner relationships
The focus can frequently be on the initial partner selection with mechanical contract reviews thereafter. Our management consultants will develop a more strategic supplier management framework to partner management and review which can pay dividends. This will include clear partner governance and focus proportional to their importance and value, together with a rounded assessment of the overall partnering objectives, current relationship health and discussion of future opportunities to bring further value. We can also help you review difficult or poorly performing partner relationships to see how to best to move things forward.
Supplier selection: first-hand experience
As The Berkeley Partnership is completely independent, with no alignment to any other organisation, we can play a purely impartial expert role in helping you make the right supplier selection.
Our skills in partner selection and mobilisation are strengthened by our first-hand experience of actually delivering complex change. We know what it takes to ensure success and therefore what to look for in partners. We’ve also worked side by side with a number of key third party organisations, leading system integrators and software vendors, for example. This means our understanding of skills and capabilities in the marketplace often runs deeper than simply meeting them through the selection process.
The Berkeley Partnership provides specialist independent expertise to ensure that you establish the right relationships and enable strong collaboration across multiple partners to meet your business’ ambitions.”
Christian Ingram, Partner
Clients often ask us…
Question 1
How can I create a sourcing strategy that specifies the types of third parties I need, the particular skills and experience they must have, and how best to go about procuring them?
Question 2
What’s the best way to bring a complex group of stakeholders together to work effectively with a shared understanding and objectives?
Question 3
What supplier evaluation process can I use to cut my long list of candidate organisations through to final selection?
Question 4
How can I ensure my commercial frameworks, negotiating approaches and long-term management frameworks are competitive and incentivising?
Question 5
What are the methods to ensure my chosen partners get on board and start working as quickly and effectively as possible?
Question 6
How can I create good governance, optimal ways of working and reporting structures for my suppliers?
Question 7
How do I review supplier performance and vendor relationships to ensure that they are delivering to original objectives and more value could be derived? And what do I do if my objectives change?
Client stories
A consumer goods organisation
Our client engaged us to provide programme delivery expertise and to help them run a rigorous supplier selection and mobilisation process, appointing the organisations who would ultimately support them in creating a new fit for purpose infrastructure.
Xaar - Reviewing a critical investment
Xaar were growing fast and had made big commitments to ramping up that growth still further. They knew their current systems needed to be changed to support this growth and they were close to making a big ERP investment which could well have proved to be an expensive mistake. We were called in to review this decision and quickly set them on the right course to creating a firm foundation for continued growth.
Xaar knew they needed to invest in new systems to support their continued growth. They had embarked on selecting a solution and had got down to a shortlist of two major ERP suppliers. Before making such a big critical investment, they took the wise decision to double-check that they were doing the right thing, which was where we came in.
Unilever - financial reporting
Unilever wanted to redefine its approach to management reporting, extending existing SAP tools to deliver a simpler and faster European financial close and management reporting timetable. We helped them evaluate their options, define plans and create the business case to secure funding for the project and then took over mobilisation and management of the 50-strong global vendor/client team which would deliver it.
Client stories
Our client engaged us to provide programme delivery expertise and to help them run a rigorous supplier selection and mobilisation process, appointing the organisations who would ultimately support them in creating a new fit for purpose infrastructure.
Xaar were growing fast and had made big commitments to ramping up that growth still further. They knew their current systems needed to be changed to support this growth and they were close to making a big ERP investment which could well have proved to be an expensive mistake. We were called in to review this decision and quickly set them on the right course to creating a firm foundation for continued growth.
Xaar knew they needed to invest in new systems to support their continued growth. They had embarked on selecting a solution and had got down to a shortlist of two major ERP suppliers. Before making such a big critical investment, they took the wise decision to double-check that they were doing the right thing, which was where we came in.
Unilever wanted to redefine its approach to management reporting, extending existing SAP tools to deliver a simpler and faster European financial close and management reporting timetable. We helped them evaluate their options, define plans and create the business case to secure funding for the project and then took over mobilisation and management of the 50-strong global vendor/client team which would deliver it.
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