Vendor management is not always easy. We’ve all run into difficult vendors at some time in the past. Some use archaic methods and practices, which are mostly paper based, and require extensive work. Others have strange payment cycles, or complex project management systems. 

Whatever the problem is, the reality is that in most cases, vendors should be changing their approach to suit you. Not the other way around. 

The Sole Source Exception 

Before we look at some of the ways that you should be expecting vendors to integrate with you, it’s important to note that exceptions do exist. The most important being a sole source supplier. If the vendor is the only company supplying a particular product or service, and there’s no viable alternative, it may be worth working with them. If the alternative is retooling your operation, or not being able to deliver to your own customers, some flexibility is advisable. 

Identifying Problem Vendors 

Sometimes it’s not so easy to identify a problem vendor. Maybe you’ve been working with them for a long time and have become used to their processes, or maybe you’re a newer company who assumes you need to be more flexible. 

The truth is we should all be reviewing all our vendors on a regular basis. 

Most importantly review their pricing. Contact alternative companies and find out what they are charging. Prices don’t mean you have to leave a vendor that you prefer, but they are the start of a negotiation. 

Next consider any problems you have in dealing with the vendor. Are they hard to reach? Do they have difficult processes and procedures? Do they expect you to work with their timelines? 

Since you are the customer and paying their bills, you get to make the rules. You can always vote with your wallet by choosing a new vendor. 

Approaching Problem Vendors 

Once you’ve identified vendors that are posing a problem to your company and your own internal processes, the next step is to approach them. 

Many vendors will be willing to change the way they operate if a good customer asks them to. 

You should have detailed information ready about what they are doing or not doing and how it impacts your business. Ideally you should be able to suggest an alternative process or procedure. While they might not adopt your solution in its entirety, they may well be willing to meet you halfway. 

Be Open to Suggestions 

Sometimes it’s not that your vendors don’t want to integrate with your systems, it’s that they not set up to do so. If your vendors provide a reasonable explanation for not integrating with you, and a workable alternative suggestion, consider it on its merits. There may be valid reasons why they can’t comply with your request. 

Always Have Alternatives Ready 

The worst way to get trapped in an unbalanced relationship with a vendor, is to have no alternatives available. 

This is why it’s so important to identify and on-board alternative vendors for every product and service your company uses. Whether it’s office supplies or complex services, not being able to pivot when you need to be a problem. 

Even if you have a preferred vendor there may come a time when they were unable to deliver. This may be due to a capacity issue, a pricing problem or something else. Even if the relationship doesn’t end, you cannot allow your own business to grind to a halt because of this. Evaluate your current vendors and find one or two alternatives for each service and product you use. Think of it as an operational insurance policy. 

Sometimes, You Outgrow Your Vendors 

Sometimes problems with vendors or not due to unwillingness on their part. Occasionally you simply outgrow your vendors. If you are relying on small businesses and independent contractors, they may come a time when they simply cannot do what’s necessary to integrate with your business. 

While it is always unfortunate to end a good relationship if this is the case that may be necessary. 

Know Your Line in the Sand 

Sometimes the integrations we require from our vendors, are rather than needs. they are nice to have but they are not operationally required. While it’s always reasonable to expect your vendors to integrate with your needs, if you don’t need to make them jump through hoops, it may be worth stepping back on certain issues. 

They will always be issues of integration that are not negotiable. Know what they are before you start the conversation. 

Aim for Symbiosis 

In the natural world, when we have symbiosis, everyone wins. This should always be your goal in business. Instead of aiming for situations where there’s a winner and a loser, look for ways to collaborate so that everyone wins.  

Your vendors might not even be aware that there is a problem. So always start with a conversation, laying your problem, how it affects your business, and what you need them to do. It might be as simple as telling them that you need them to change, but even if it’s not, there may be opportunities to find middle ground.  

Contact us, so we can help you create a straightforward, results-oriented framework that connects governance, delivery, and culture to help you thrive and organise. 

If you’d like to engage Fatimah as a coach/advisor for your organisation to help you make sense of the chaos, then you can reach out to her by email at Fatimah.a@agilemanagementoffice.com