Despite good intentions on both sides of the fence, a service provider partnership can falter and you may find yourself considering options for service recovery. There are many reasons as to why this can happen (such as contract clauses), but the key point at such a stage is to consider how to resolve the issue.
Whilst looking back on what has gone wrong can be a useful exercise, looking forwards to a positive resolution will give you the best chance of service recovery. With that in mind, the biggest step you can take towards getting your partnership back on track is to communicate clearly with your vendor regarding perceived failure, against the backdrop of your original intended outcomes and the contract terms.
In our experience, there are 9 key steps that you should take in preparing for the all-important meeting with your vendor. In this article, we will go through each step in turn, pointing out the key actions to take.
As is often the case, preparation is key. There is no point marching into a service recovery meeting with your vendor, all guns blazing. Put emotion to one side and focus instead on the factors that need addressing. After all, your vendor can only be expected to deal with the issues at hand if they have been adequately quantified.
Put background evidence together to back up your assertions that all is not well in terms of service delivery. Most importantly, revisit the operating benefits that your organisation was expecting from the partnership, and compare intended and actual outcomes.
2. The Contract
It is of vital importance that you go into the meeting armed with a good understanding of the contract terms that are relevant to the issues at hand. If you do not, you are likely to find yourself being obfuscated by technical arguments, or a simple claim that your expectations are not matched by requirements in the contract.
Take a good look at the schedules – i.e., your requirements, expectations, implementation plan, and so on. Are they specifically referenced in the contract, or have you always assumed that they are implied?
3. Quantify Costs/Losses
You must quantify any costs and/or losses associated with the difficulties in reaching your objectives. Doing so serves as a great motivator for your vendor, because if the costs and/or losses can be quantified and proven, they may become the vendor’s responsibility.
4. Obligations and Responsibilities
A lot of disputes in service provider partnerships are based upon obligations and responsibilities. This is where your understanding of the contract comes into play, as you will need to undertake a review to confirm who was supposed to do what. The key questions are as follows:
- Who was responsible for contract management?
- What participation did your vendor have in managing the project?
- What participation did your own people have in managing the project?
This process will help you draw a line of demarcation around who was responsible for managing which parts of the project. If you discover that your contract is not clear cut, the vendor will typically have implied responsibility.
5. Service Recovery Objectives
It is one thing knowing that you are unhappy with the way in which a service provider partnership is progressing (or not, as the case may be), but understanding the details of an ideal outcome for service recovery is another matter altogether.
Therefore, you must consider why you are meeting with your vendor, beyond the simple desire to communicate your lack of satisfaction. Are you looking for better performance? A better relationship? Do you want to get out of the contract early? Do you want a new provider, or are you looking to bring the service back in house? Have a clear (and ideally quantifiable) idea of your intended outcome.
Before taking your issues to your vendor, it may be worth seeking independent validation of your issues.
Have you had your expectations, contract terms, requirements and schedules externally validated by an independent organisation or individual? Furthermore, does that organisation or individual understand the practical ramifications of operating and implementing outsourcing agreements? Finally, can they competently assess your intended actions in attempting improvement in service levels and ensure that you do not undermine your contractual position in the process?
7. Writing to Your Vendor
In order to establish written evidence of your dissatisfaction and get the ball rolling on a formal process to recover the partnership, you should write to your vendor. However, and moving directly on from my previous point, you must be very careful as to how your letter is worded. The last thing you want to do is undermine your contractual position, or possibly give the wrong impression to your vendor as to what your intentions are.
With that in mind, try to be objective in your overview of the situation in your letter. Explain what has gone wrong, your objectives in achieving a resolution, time frames, success factors, and the dates and individuals required for the meeting.
8. Formal Meeting
The point at which you meet with your vendor to discuss the issues at hand is the most difficult situation to control. The key is to think and act constructively.
Your first step should be to consider what the vendor thinks is wrong. Then you should work through your issues and their consequences. Ask for resolutions, and agree timeframes and milestones. Review consequences for the vendor and yourselves in the event of achievement or non-achievement.
9. Manage the Improvement
As always, you must manage and measure the process in order to gain any real advantage from it. Negligence on this front will seriously undermine your attempts at trying to get the performance of the project back on track.
Therefore, you must ensure that an appropriate overlapping contract and project management framework is drawn up. Ensure that objectives and achievements are kept in check. Ensure that you don’t remove “expert” responsibility from the vendor. Continue to document everything that is happening, and formally benchmark the process.
Creative Commons image courtesy of lrargerich