Six Vendor Management Tips within a large scale IT Transformational Project

Are you a CEO, Program Director, Senior Project Manager or COO and struggling with delivery of a large scale IT transformational project? If yes, there could be several reasons for the issues you are facing, the two key ones being:

a)     Lack of a Change Management strategy and b) A poor Vendor Engagement Strategy

For this article, I would want to focus on the latter, which is often ignored and not given the weight and focus it deserves. I will share six tips that you might find helpful whilst engaging and managing IT vendors, especially within a large scale IT transformational project:

1.      Vendor Selection: Don’t take shortcuts when onboarding an IT vendor. Follow the full procurement process right from RFI up to RFP and reference site visits

2.      Statement of Work (SOW): Prepare a Statement of Work(SOW) well in advance and before bringing the vendor on site. Have the SOW agreed and signed off by both parties

3.      Contracting: Spend quality time and effort in the contracting stage and with heavy involvement by the legal team. Pay special attention to such items like: penalty clauses, exit clauses, warranties, approach for handling customizations and finally evidence of working solutions(before contract signing)

4.      Performance Management: Before the program kickoff, agree on a performance management plan with the vendor that will cover an array of activities including Quality Assurance, Reporting and Cost Management. Without this, the vendor will have a free hand to deliver what he wants and whenever he wants

5.      Relationship Management: Relationship management is a key factor in determining how successful a vendor will execute on his deliverables. To steer success, the project/program manager needs to foster a healthy relationship between both parties that focuses on a partner-partner relationship vis a vis vendor-partner relationship

6. Workstream Management: One of the biggest mistakes made in most projects is lack of a workstreams definition with an assumption that the vendor will just handle everything. From the onstart, there needs to be a clear definition and outline of the key program workstreams.At a minimum, you need to define the following workstreams:Change Management, Master Data management, Deployment & Rollout, Business Processes, Business Requirements, Cost Management and Resources Management. You then need to be crystal clear in your Project Management Plan, what the vendor's role is, in each of the workstreams (preferabbly use a RACI matrix to do this).

What's being your experience working with IT vendors in large scale transformational projects? Share your experiences please.