HR Technology Vendor Relationship Management
Benefits administration outsourcing has been on the rise for years, and those who outsource benefits administration are also outsourcing other complex HR functions at a similarly rapid pace. For example, among those organizations who outsource, the average number of vendors used ranged from a low of two (for companies with under one hundred employees), to a high of five (for those with more than 1000 employees). The increase in number of vendors used is a telltale sign that employers are looking for a “best-of-breed” technology strategy - one service from different vendors - versus the all-in-one model.
At benefitexpress, we strongly recommend human resources departments employ the best-of-breed strategy because many all-in-one systems are not able to support the complexity of modern benefits programs. However, keep in mind that moving to a best-of-breed strategy will require the ability to manage vendor relationships successfully.
To help you navigate this potential hurdle, we’ve put together five tips on how to improve and maintain your vendor relationships so that you can feel comfortable trying a best-of-breed strategy as you plan ahead for next year. Plus - these tips apply no matter the business area. Fine-tune all your vendor relationships by using these steps.
1. Think of vendors as your partners
It seems simple, but a quick terminology adjustment can pay dividends in the long run. When we asked members of our client-facing staff (many of which have 15+ years in the benefits administration outsourcing space) to articulate the main difference between being described as a “vendor” versus a “partner” they unanimously agreed: it’s transactional vs. relational.
Vendor-client relationships are often more transactional – checking items off a to-do list together. Partner-client relationship are more relational – mutually developing and executing strategy to reach shared goals and important milestones. Overall, HR pros that see vendors as partners have stronger relationships and can depend on their vendors to come through in times of urgency or increased employee demand.
2. Designate an internal single point of contact to manage each vendor relationship
If you use multiple vendors to help execute a variety of HR tasks, you will want to make sure that each vendor has a designated point of contact from your company to work with. This could be one employee who works with all vendors, or several employees who work with one or two vendors each. Whatever method you choose, having a point person cuts down on ambiguity and gives agency to that individual to effectively manage all aspects of the vendor relationship; contract review, daily workflow, review of KPIs, and more.
3. Involve your vendors in strategic planning sessions
Typically, organizations originally turn to a vendor because they are trying to accomplish something that they can’t complete in-house. But remember – beyond executing the day-to-day tasks – these vendors have specific industry knowledge and skills that can be of great benefit to your organization – so make sure you continuously tap into that resource!
Take the time to communicate your short and long-term goals and where you want to take your department in the future. Then, ask for their feedback and suggestions on the role they can play to help you achieve these goals. A solid vendor will typically have unique insight into ways you can improve that you won’t find anywhere else.
4. Communicate regularly
As with most things in life, communication is key. Go beyond the monthly call and schedule frequent check-ins via email or webinar to monitor weekly, or even daily progress. When conducting these calls or writing these emails, pay attention to the quality of your conversations. For example, instead of simply asking for a status report, consider asking for their feedback. What would they change or do differently? What do they see other clients doing that could be adapted to your workflow?
The more you communicate, the better your vendor will understand your business and help you achieve your goals more quickly. However, it’s important to remember that relationships are two-way street. Consider visiting your vendor’s place of business, or plan to meet in person at an industry event. The more reciprocal and personal your relationship, the stronger it will be.
5. Refer a trusted partner to others
If you are happy with the services that your vendor provides you – don’t keep that information to yourself! Instead, share the good news with other professionals in your network. When you refer someone to a vendor, you will increase their loyalty towards your organization. They may even start to see you as a trusted resource as well and could ask you to sit on a client advisory council to share your opinions about how to make their product and services better – benefiting you, and your organization far into the future.
Ready to select a benefits administration partner who truly engages as a member of your team? Explore the benefitexpress difference.