Managing Vendors – Who Owns Your Business?
Who owns your business?
Well, you do!
OK, I know, unless you are a one-person business like I am, you probably work for a corporation that has an executive team, a board of directors, and stockholders. But I am not getting into a philosophical discussion of ownership models. . .
You own your business!
Whether you are a business owner, executive, mid-level manager, an experienced team member, or a new hire – you are the one responsible for the fulfillment of your role as it feeds into the corporate goals and accomplishments.
Who owns their business?
I am speaking of your vendors and service providers. Every employee of their business holds an ownership responsibility in their business.
The representatives from your vendors who support your company work for their employers. You are not their employer. They are responsible to fulfill the goals, metrics, and ambitions of their employer – just like you are responsible to your employer.
Delegate Roles and Tasks - Never Delegate Responsibility
Responsibility – that is the key word.
Whether or not you actually do all the tasks that cause your responsibility to be accomplished - you are the one who makes sure the responsibility is fulfilled.
A few blog posts ago, I discussed the differences between an employee, a contractor, and a vendor. Of these three, only the employee is responsible to just one employer.
Contractors and vendors have divided loyalties – to you and to their employer – they are distracted. Ultimately, they are responsible to their employer to fulfill their employer’s goals and ambitions.
The tasks and roles they fulfill for you and your company will be done through the filter of their responsibility to their employer.
And that is exactly what they should be doing.
Therefore, you should only ever delegate tasks and roles to vendors and contractors – never delegate responsibility.
Responsibility needs to stay in-house.
That was one of the things that made the American Airline Sabre System so effective at vendor management. Sabre had a team of employees who were responsible to see that all vendors performed to their contracted roles and tasks. That team would meet with our company’s senior management each month to review:
Service call response times,
Mean Time to Repair,
Parts management, and
Everything other performance item that was part of our contract with them.
That Sabre System team was responsible to make sure we completed everything well.
I remember once – just once - I accidentally took a Sabre part for another customer’s service call. Oh, boy, did I get in trouble!! There was no place to hide the error. It had to be reported to the Sabre System team in the next monthly meeting.
This brings up a very pertinent point – what is the line between vendor accountability and micromanaging a vendor? The opposite question is equally valid: what does “non-managing” a vendor look like?