7 Useful Rules for Managing Suppliers

Finding people who share your work ethic and worldview can be quite difficult, as we discussed in this post. But, when you’ve finally found good suppliers, it’s equally important to have a good system for managing them, so everyone stays productive and happy.

We have independent contractors (developers, designers, writers, marketing experts etc.) from 8 different companies working with us at the moment. But we only have 7 rules we stick to for working with all of them.

1. Know what you want and make sure your suppliers do too

be specific
If you want a dog, don’t ask for a four legged friend: be specific

The worst kind of client is the one who doesn’t know what they want, but they’re sure it’s not what you’ve given them. We don’t want to be those people.

We give our suppliers very clear briefs that explain the problem we want to solve, and our understanding of what a successful solution should achieve. Beyond this, the supplier is encouraged to bring their expertise and creativity. We hire them because they’re experts, after all.

For example, we might say ‘we want to increase our exposure in Johannesburg, and increase our user base there’. How the supplier (let’s say a marketer) wants to achieve this can vary. They might propose an activation, a series of cold-call emails, a radio ad, a Youtube video, or a corporate sponsorship. We’re open to any and all suggestions. The important thing for us is the result. At the end of the day, we want you to solve the problem and bring us more active users. We’re not fussy about how you’ve done it (as long as it’s ethical and legal, because we care deeply about that).

2. Aim to pay for results, not for effort

We understand that anything worth doing takes time. And we also understand that despite the best laid plans, unexpected things crop up. This happens in our own work, so we understand when this happens to our suppliers too. However, when we agree to a deliverable, we hold our suppliers to it, and structure the payment schedule in the contract to reflect delivery. Although we appreciate effort, effort is not the same as results, and we’re very clear that we only pay for the latter. We’re also suspicious of anyone who seems to be overpromising. We’d rather have someone give us more modest, realistic, and achievable deliverables.

3. Have weekly or bi-weekly status reports

We have short daily check-ins with internal teams and the suppliers we work most closely with. For suppliers we don’t interact with every day, we check in weekly, or bi-weekly at the very least. This is so we can gauge their progress, and they can bring any issues to our attention. Having regular status reports is vital for ensuring work stays on track.

For example, our social media manager submits publication schedules a month in advance. However, we like to check in every week to help proactively shape each schedule. Regular contact also helps you get to know your suppliers a bit better, which makes it easier to handle conflicts informally, and to quickly understand when a relationship is unlikely to work out.

Checking in can be done in person, in writing, or via calls. The important thing is to get a complete and accurate view of progress. ‘FYI’ emails that tell us what suppliers are doing behind the scenes are also nice, but always remember rule 2.

4. Work with people who specialize

specialists
Specialist knowledge isn’t just book knowledge — being able to execute is vital

The phrase ‘Jack of all trades, master of none’ haunts us. We’re just not convinced that anyone can do everything, and be equally good at everything (when would these people sleep?). So, if a supplier wants us to hand over all our copy, all our design, all our development, all our marketing, and maybe even some of our legal at the outset — we’re immediately wary. Everyone can be good at something, and many people are good at a lot of things, but we’re not convinced everyone can be good at everything.

Although we are strong on working with specialists, we also recognise that many people want to expand their skill sets. For example, if someone tells us that they are a designer with some development skills, we’ll try to come to a mutually agreeable arrangement that will create growth opportunities while ensuring critical work and deadlines are not at risk.

5) Speak to the people actually doing the work

In most companies, there is a clear division between the people who look after clients, and those who actually deliver the service or produce the goods. For example, the supplier’s general manager might be the one who shows up at your meeting, but you can be fairly certain that’s not the person who’s doing the actual logo design.

We like to speak directly to the people doing the job. This minimises the potential for things getting lost in translation as they are passed from client service to creative and beyond. You also get to hear about potential issues upfront. And you get insight into how the other company runs their business and treats their people — it’s very important for us to work with nice people. We like to run a relaxed, friendly (but efficient) ship. And we value things like honesty, integrity, and transparency. So, we try to work with people who share the same values.

6) Have a clear delineation of tasks

To do their job properly, a supplier will need certain things from you. The most obvious is a brief. They will also need relevant company assets or information for their job. But understanding what they need, what you will provide and what needs to be done along the way is critical to managing expectations on both sides, as well as costs.

We try to do as much of this as we can at the beginning of a task, investing as much time as necessary to identify as many of the processes, decisions, and deliverables as we can. This helps us assign ownership of particular deliverables to particular people, and to design feedback loops that allow us to monitor progress. So, when (not if) something that we didn’t anticipate pops up, we are able to identify the issue quickly, discuss it with our supplier, and determine what impact this will have on our agreement, which requires asking a few important questions, like: Does it change the timeframes for the task? Will it impact the cost of the task? Is it fair for us to pay more because of this?

7) Once your supplier has built a track record with you, trust their expertise

trust
Trust is a big part of working relationships.

We hire experts so that we can trust them. If our email guru tells us pictures in emails are nice, but could result in significantly less downloads because pictures take up data — we listen. We’ll ask them for the parameters of the argument (could we get away with animation instead of photography, for example), and possible workarounds, but we are unlikely to pay for expert advice and then set out to do the complete opposite. Our suppliers have told us horror stories of clients changing copy and sending back grammatical nightmares for the writer to untangle, or ‘something I whipped up in Paint’ for designers to replicate. We try to respect our suppliers as much as possible. And where we have the expertise, and our suppliers are primarily implementers, we try to provide clear and specific instructions to make efficient use of their time.

Managing suppliers is vital to the success of an organisation, and these are some of the learnings we’ve picked up along the way. In this article, we share our learnings on how to contract with suppliers (and in life in general).