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Wednesday, March 7, 2012

Introduction to Supplier Management


These days, some IT services are provided (As the Total Package) by the IT Service Provider. For example, services relying on networks for delivery are likely to depend on a telecommunications provider for links between geographically dispersed sites; hardware maintenance will usually be in the hands of a third-party supplier; commercial software packages will be supported and maintained by external suppliers, often, but not always, the software vendor.

As discussed under Service Level Management, the relationship between these external providers and the IT service provider is in part defined by Underpinning Contracts between the IT service provider and the third-party suppliers responsible for supporting services. However, Supplier Management, which seeks to ensure that suppliers and their services are managed in such a way that the continuing quality and good value for money of IT services is ensured, is about much more than the one-off negotiation of a support contract.

Before we discuss any further about Supplier Management, let’s take a look at the official definition of a Supplier
A Supplier is - A third party responsible for supplying goods or services that are required to deliver IT services.

Supplier Management is all about getting the best from suppliers in order to ensure the delivery of services meet agreed service level targets at optimal cost. It is about getting good value for money from suppliers. It recognizes that there is more to a supplier relationship than the contract, seeing the relationship as a continuing and dynamic asset that not only serves the needs of today, but also helps the IT service provider respond to new challenges and risks as the commercial, technological and social environment changes around it. It recognizes the need for Continual Service Improvement and the value of productive relationships as a platform for achieving higher service quality or better value for money or both of these things.

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