MANAGING VENDORS

MGT OF ISD (IMS452)

DEALING WITH VENDORS

• Establish a relationship

• Past experience– Past organization experience– Past personal experience

• Negotiate

• Help the vendors

• Think long term

• Get multiple bids

Cont..DEALING WITH VENDORS

• Set up a trial experience– Buy something small -> to make the needs clear and

realistic -> note how well the vendor perform

• How well does each vendor meet each criterion?– For important purchase decisions -> set up a simple

matrix to compare the options

• Spending limits– Formal standards to determine level of personnel to

sign for how much

Cont..DEALING WITH VENDORS

• Reviewing contracts with vendors– Getting formal legal or legal consultant to assist on

reviewing the contracts • Issues on confidentiality, warranty, liability, applicable laws • Sections Terms and Condition (Ts and Cs)

– Service level guarantee– Specification of hardware and software– Support, maintenance, upgrade terms– Automatic renewals– Ability to return/cancel if not satisfied– Specific deliverables– Associated costs, time frames etc

– Everything is negotiable and can ask for changes

Cont..DEALING WITH VENDORS

• Direct company reps– Effective means of getting the equipment you need– Better informed about the product than VAR of how

the products works, how many items they have, or have idea where to get if don’t have

• Value Added Reseller’s (VARs)– Salespeople with multiple product line– Resell other manufacturers’ product– Can provide excellent price – Can provide additional services

• Eg preload software, keep track on licenses, get detailed information on the product and get support

KEY EVALUATION METRICS

• Set up a matrix– To evaluate most technology products– Typical evaluation matrices include

• Functionality• Price• Performance• Vendor viability: is this a vendor that will be around

for a while• Training required • Vendor services

KEY EVALUATION METRICS• Set up a matrix

– To evaluate most technology products– Typical evaluation matrices include

• Functionality– Does the product do exactly what you need it to do?

• Price– capital investment – up-front cost of an item, including

the hardware and software and other components to make it do what you need it to do

– Total Cost of ownership (TCO) – up-front capital investment, including the costs for ongoing support and maintenance, implementation, training, prerequisite hardware/software, conversion/migration etc

• Performance• Vendor viability • Training required

Cont… KEY EVALUATION METRICS• Cont …Set up a matrix

– Vendor services – do you need the profesionals services from the vendor to customize the product, or help to install or integrate into your environment

– Scalability– support and and service– Interoperability– speed of delivery and availability

SAMPLE EVALUATION MATRIX

Vendor evaluation matrixProduct

AProduct

BProduct

C Best

Option

Functionality        

Price        

Performance        

Vendor viability        

Training required        

Vendor services        

scalability        

support and service        

interoperability        

speed of delivery and availability        

GETTING CURRENT INFORMATION• The Web

– Trade journals, newsletter and news outlet eg. www.cnet.com, www.itmanagersjournal.com, www.slashdot.org

– Technology standard eg. ANSI – www.ansi.org, IEEE – www.ieee.org– Reference information eg. Ww.whatis.com, about.com, wikipedia.com,

www.webopedia.com• Vendor representatives

– Invite key vendors to come in and meet with you once or twice a year for specific product vendors, system integrators or resellers (executive briefing center)

• To tell the new product announcements,• Changes in product lines• What their other customers are doing with the technology

• Trade journals (electronic and print)– Start with free publisher group first eg. Ziff-Davis (www.ziffdavis.com), CMP (

www.cmp.com), IDG (www.idg.com)– Glace the headlines – to keep you aware of what is going on – Look into journal which match your responsible level and topic that relevant to your

department– Circulate the relevant information to your staff– Sign for emal and latest newsletter

Cont … GETTING CURRENT INFORMATION

• Trade shows– The seminars, conferences and panel discussions can

be very valuable– The topics may about a recently completed project,

management strategies or the pros and cons of different technologies

– Make use of QA and testing and evaluating products

• Brown bag lunches– Is an informal get together where attendees bring their

own food– Eg sharing knowledge after attending a course or

volunteered present briefy on a technical topic of their choice (KSA)

PURCHASING SOURCES

• Web (catalogue)– can quickly scan to get informed about

product categories and the price information– Can access them even if not connected or

near the machine that you need• Retail stores

– If they have what you want -> may be the quickest place to get something in an emergency

– Most corporate IT not purchase in retail stores because retail stores do not have sophisticated hardware that IT need

Pros and cons of buying on the Web

PRO• Easy to get more detail about

the product• Can get information about the

product without buying it• Easy to get comment from

other users/purchases of the product

• Item sold online sometimes cheaper

• Can buy direct from the manufacturer or various resellers

CON• Don’t have opportunity to

establish a relationship• May insist credit card

payment- opposed to the corporate purchase order

• It may difficult to assess the delivery, warranty and service options and the rights

Pros and cons of buying from a retail store

PRO• Fast• Tactile – can touch

CON• Limited inventory • It is retail operation

(traditional)– Eg open certain hours– Eg counter queue– Difficult to find things– Promoter

• It’s primarily targeted for the consumer market– Not the brand or item you

are looking for

Cont .. PURCHASING SOURCES

• Gray markets– Are brand name items sold outside of the producer’s

official distribution channels – Don’t include the company’s warranty, service and

support– Dollar costs and legal costs

• VARs– Can be the best avenue for purchasing hardware and

software provided you know exactly what you want– Combines various components – hardware, software,

services or a combination of all three to provide a custom solution

– It may make the environment complex and the needs will be well define, that can value added and increase the cost and not necessarily additional item