Vendor Contracts & Relationships Dorothy C. Beach, MBA CIR Recruiting Researcher, Sourcer and Analyst FrontEndRecruiting.ning.com

What we’ll cover… Starting a new vendor relationship How to assess vendors How to maintain the relationship Negotiating the next contract What if the vendor falls short? So why do we need job boards?

Starting a new vendor relationship

How to assess vendors

How to maintain the relationship

Negotiating the next contract

What if the vendor falls short?

So why do we need job boards?

Sources Forrester Research paper “IT vendor Management” by John McCarthy August 2008 SHRM white paper: “Evaluating Vendors” October 2007 Crispin and Mehler’s SOH Study 2007 Recruiting Operations experience at ACS Inc.

Forrester Research paper “IT vendor Management” by John McCarthy August 2008

SHRM white paper: “Evaluating Vendors” October 2007

Crispin and Mehler’s SOH Study 2007

Recruiting Operations experience at ACS Inc.

Starting a new vendor relationship Outline the business needs first and rank importance of each Compare vendors against these needs Someone has to own this responsibility on both sides Business needs could be branding awareness, resumes of certain titles in certain locations, posting capability with cross-posting, easy interface, reporting capability, etc. Spreadsheet example

Outline the business needs first and rank importance of each

Compare vendors against these needs

Someone has to own this responsibility on both sides

Business needs could be branding awareness, resumes of certain titles in certain locations, posting capability with cross-posting, easy interface, reporting capability, etc.

Spreadsheet example

Ongoing scorecard for both vendor and client Regular reviews of the account use occur Regular reviews of branding results are given Payments are on time Communications are open and people are accessible Regular adjustments, such as additional training, are made if product is underutilized or branding isn’t working

Regular reviews of the account use occur

Regular reviews of branding results are given

Payments are on time

Communications are open and people are accessible

Regular adjustments, such as additional training, are made if product is underutilized or branding isn’t working

Quadrants of vendor and client relations

Negotiating the next contract Have joint meetings – preferably face-to-face Develop an exit strategy for any contract going into negotiation Understand the demand for the vendor’s product in the marketplace Have retrospective metrics ready to build your business case for a change in contract Go in with cutting cost of overall contract by 15% and make that known to the vendor up front

Have joint meetings – preferably face-to-face

Develop an exit strategy for any contract going into negotiation

Understand the demand for the vendor’s product in the marketplace

Have retrospective metrics ready to build your business case for a change in contract

Go in with cutting cost of overall contract by 15% and make that known to the vendor up front

Negotiating the next contract Find out what part of the product offering enjoys the highest margin and negotiate for discounts there first Ask for pricing comparisons for packages and get extremes of product packaging Use the scorecard to build a business case and develop future relationships Keep focused on the business needs – don’t pay for what you MIGHT need

Find out what part of the product offering enjoys the highest margin and negotiate for discounts there first

Ask for pricing comparisons for packages and get extremes of product packaging

Use the scorecard to build a business case and develop future relationships

Keep focused on the business needs – don’t pay for what you MIGHT need

If the vendor falls short… Hold joint meetings to go over issues and recap the minutes in writing Define and sign off on an action plan Review action plan on a timed schedule In the meantime develop an executive mandate to divorce the vendor Investigate alternatives for seamless hand over

Hold joint meetings to go over issues and recap the minutes in writing

Define and sign off on an action plan

Review action plan on a timed schedule

In the meantime develop an executive mandate to divorce the vendor

Investigate alternatives for seamless hand over

Challenges most cited by managers Lack of clear definition and delineation of roles (47%) Business unit resistance (44%) Global sourcing resistance (43%) Lack of executive mandate to follow a clear process (41%) Initial vendor contracts not effective enough (36%) Vendor responsiveness is poor (34%) No process to manage vendors (32%)

Lack of clear definition and delineation of roles (47%)

Business unit resistance (44%)

Global sourcing resistance (43%)

Lack of executive mandate to follow a clear process (41%)

Initial vendor contracts not effective enough (36%)

Vendor responsiveness is poor (34%)

No process to manage vendors (32%)

Why do we need job boards? Hires attributed to Job Boards (including the company site) represent 25.7% of all external hires Referrals make up 28.8% of all external hires (alumni sources are fast growing) Internal transfers and promotions make up 30% of all positions in the company Traffic is declining for Job Boards since 2005 – time to do better contract negotiation Trend of an increase in company direct hires through sourcing teams (in house or outsourced)

Hires attributed to Job Boards (including the company site) represent 25.7% of all external hires

Referrals make up 28.8% of all external hires (alumni sources are fast growing)

Internal transfers and promotions make up 30% of all positions in the company

Traffic is declining for Job Boards since 2005 – time to do better contract negotiation

Trend of an increase in company direct hires through sourcing teams (in house or outsourced)

The future of job boards Large vendors might be losing ground to niche sites like Craig’s List* Niche sites are being better utilized* Other points of contact with candidates are developing at a fast clip (LinkedIn, Facebook, YouTube, Twitter, IM, GPS etc.)* SEO is driving candidate traffic to YOU Recruiters are becoming the network hub (your network is your currency)

Large vendors might be losing ground to niche sites like Craig’s List*

Niche sites are being better utilized*

Other points of contact with candidates are developing at a fast clip (LinkedIn, Facebook, YouTube, Twitter, IM, GPS etc.)*

SEO is driving candidate traffic to YOU

Recruiters are becoming the network hub (your network is your currency)