Date 03052007.ppt

Vendor Management and Metrics AT Kearney’s IT/Telecom Vendor Facts IT/Telecom service, software and equipment vendors play a vital role in the our organization… Use approximately 200 vendors in 35 countries throughout the world These vendors generate 3,400 invoices annually Vendor purchases account for 67% of total IT/Telecom spending Internally Managed Vs. Vendor Provided Internally Operated Overall Service Management Technology Architecture and Design Network Systems Applications Security Infrastructure Administration Data center management Network administration Systems administration Voice PBX administration User security administration Event monitoring, escalation and tracking Problem management, Change management Client Services User desk side support Software configuration and distribution PC and software asset management Procurement and asset management Financial administration External / Vendor Purchased Data network provisions Telephony services Fixed line Mobile Remote access services Application development Consulting / temporary labor Data center facilities Help Desk Hardware and software purchases Vendor Size Distribution 80% of our vendor spend comes from 20% of our vendors globally Most management effort is concentrated around the largest vendor relationships The most critical vendors require a carefully managed relationship Seek to centrally manage vendor relationship and contract Unify spend commitments globally whenever possible Minimize risk by avoiding minimum spend requirements – clearly understand how much savings are gained by making the commitments Establish the SLA at contract signing -- do not wait until after the agreement is signed to establish the SLA) Ensure SLAs are achievable for supplier and relevant to the business Tie penalties and/or material breach to SLA performance; ensure contract leverage to cancel agreement based on non-performance Understand that metrics are easily manipulated -- Clearly define measurement calculati