Vendor management by the numbers

Whatever you do, don't choose a vendor based on price alone. That's just one piece of advice offered by three CIOs at a roundtable held by market research firm Forrester. Price is a reasonable factor for commodity products, but not for long-term vendor relationships. According to the roundtable, the three most common pitfalls are confusing vendor selection with vendor management, going for the lowest price, and failing to measure the business value of vendor relationships on business metrics. To successfully manage vendors and form strategic partnerships, first acknowledge that vendor management models vary in terms of resources and structure, and make sure to match the vendor management model to organizational needs. Second, categorize an organization's existing relationships according to the role their products and services play in the business. Third, decide on the parameters and decision points that matter most in choosing a vendor. Fourth, document the relationship even before the contract is signed. Fifth, institute regular measurement and data monitoring. Finally, define the partnership to ensure long-term success.

Learn more about effective vendor relationships:
- read the article at eWeek

ALSO:
- read this on managing vendor relationships
- this on when a vendor relationship goes bad
- and this for getting the most from a vendor pitch