Vendor Management and Software Asset Management Maintaining Multi-Faceted Relationships with Vendors 1

Vendor Management Vendor Management: Processes that build and maintain a multi-faceted business relationship with the vendors whose software is part of the organization’s portfolio of software Vendor Manager: Role is primary contact with the vendor Software Asset Manager: Often has the role of Vendor Manager

Vendor Management Advantages to Support Quicker resolution of support issues through the use of a single point of contact Vendor Manager works directly with the vendors to reduce or eliminate sources of dissatisfaction, including escalation, negotiation of protection or compensation during renewal, or influences product selection away from this vendor Vendor Manager builds trust relationship with vendor, sharing preparatory information when advantageous to the organization saving time and money 3

Vendor Management Advantages to Risk Management Risk sharing is a win-win in the contract, monitored via the vendor management processes Risk avoidance is a result of regular sharing and receiving information both directions Compliance issues discussed before they escalate 4

Vendor Management Advantages to Conflict Management Open communication reduces the risk of conflict from miscommunications saving time and money Sets vendor policies, with scheduled reviews of performance to eliminate conflicts and surprise dissatisfaction 5

Vendor Management Advantages to Quality Control Review of invoice reconciliation reports and feedback increases the accuracy of the invoice process Delivery accuracy evaluated by the Vendor Manager Quality control requires adherence to internal processes and the Vendor Manager both complies and assures vendor compliance to the internal process and policies 6

Vendor Management Advantages to Information Accuracy Accuracy is increased by standardized vendor information History and feedback collected by the Vendor Manager provides leverage in negotiations Maintains information on a vendor and the products and services saving time on research 7

Vendor Management Advantages to Disaster Recovery Plan Vendor Manager shares information about the distribution channel and contacts The Vendor Manager has contracts and other critical proof of ownership documentation that is important when rebuilding after a disaster 8

Vendor Management Advantages to Data Security Information is gathered from and provided to vendors in a controlled and planned manner as part of Vendor Management. The single point of contact is a powerful addition to security Vendor Managers ensure that non-disclosure agreements (NDAs) are in place and appropriately signed 9

Vendor Manager Role: Define Processes Crisis management Rules of engagement Vendor consolidation Required vendor data Information update Vendor Guideline maintenance Educating vendors Evaluation methodology including scale Collecting feedback Criteria for vendor ranking Contract review and non-compliance reporting Reporting

Vendor Manager Role: Manage Vendor Information Centralize, collecting data about vendors Registration Questionnaire Update process Prioritize, based on: Expense Vendor classification Strategic, organization-wide initiatives, top 5% Preferred, value add post-sale, next 20% Basic, normal vendor relationship, 75%

Vendor Manager Role: Define Vendor Policies Vendor Communication Policy Vendor Transition Policy Vendor Risk Management Policy Vendor Negotiation Policy New Vendor Policy Strategic Vendor Performance Policy Vendor RFP Policy Vendor Non-Disclosure Policy Vendor Performance Rating Policy 12

Survey Internal Customers about Vendor Performance Accuracy of invoicing Order fulfillment timeframes Vendor compliance process Vendor return policy Negotiation policy Technical support policy Business communication & responsiveness Product reliability Technical support responsiveness Product selection availability Negotiation flexibility Payment terms Sales support Understanding of organizational structure Product knowledge of the sales/support staff Accuracy of order delivery Price compared to similar products 13

Vendor Scorecards Objective Ratings Based on results: Interviews Surveys Comparison of contract to actual Delivered on a schedule

Complexity to Product/Vendor Removal Assign a Project Manager Form a transfer team Develop termination strategy Gain executive sponsor approval Select replacement vendor Develop transition plan Begin assimilation of newly chosen vendor Begin termination of current vendor Deplete inventories Clear invoices Inform users of the change Communicate with all strategic vendors Communicate with stakeholders and business units Terminate vendor transactions 15