6 Rookie CIO Mistakes in Vendor Management

It is one of the CIO roles to effectively manage the vendors to get the most for his/her business. May 2009 edition of CIO Insight magazine has highlisted 6 mistakes common to rookie CIO in vendor management.

1. Failing to Speak With One Voice

CIOs make the biggest mistakes in vendor management when too many cooks get in the kitchen without putting an executive chef in charge, resulting in no one is held accountable, communication breaks down and suppliers don’t get good direction.

2. Skipping the Homework

The CIO must be clearly understand what is required from the vendor, before expecting the vendor to understand the requirements. Groundwork such as developing written requirements and going through formal RFP process is crucial.

3. Fixating on Price

Pricing is very important, but there are other equally important factors in vendor selection. The CIO must understand to get the right people doing the right thing at the right price.

4. Using Too Few Suppliers

Too much reliance on single vendor could be disastrous, as the negotiation power will be deteriorated.

5. Only Dealing With Large Vendors

Your deal could looks small for large vendors, but could be precious for small vendors. Therefore, the smaller vendors might provide better service, and at the same time you might have greater leverage in negotiation with them.

6. Signing and Forgetting

Successful CIOs review their partners regularly to ensure everything is going according to plan and to make adjustments to agreements when necessary. Signing is just the beginning rather than an end.