Policy, Program and Procedures

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  • 1.  Business Review Efficiencies and Frameworks

    Posted 02-05-2024 12:59 PM

    Hello everyone, my first post so on top of this if you have feedback to get better results from this that would be great.

    • Area desiring insight on:
      • How to perform a more efficient business review process with suppliers?  There are weekly cadences with stakeholders but we are looking to perform them annually, unless requested more frequent 
      • Any framework for an SOP that you have used that has helped you or a team you know

    Thank you for all in advance for your time and support,

    Bruno



  • 2.  RE: Business Review Efficiencies and Frameworks

    Posted 02-09-2024 01:52 PM

    Hi Bruno,

    Business reviews are an essential part of managing your vendors, and how often to review them should depend on the risk and criticality of the vendors and how your organization also manages vendor performance. For optimal results, a combined review that addresses risk, performance, issues management, and continuous improvement is recommended. As a best practice, critical and high-risk vendors should have a review each quarter. The frequency of these reviews ensures that any issues or areas of concern are addressed quickly. For vendors with lower risks or that are not critical, you may determine the intervals for vendor reviews based on product or service type or other criteria.

    I have found it extremely helpful to establish a review cadence and standard list of agenda items for these reviews. Taking this approach will help the vendor as well as your internal stakeholders know what to expect and prepare for these reviews more effectively. While it may seem like a lot in the beginning, I have found that standardizing the process really helps everyone get on board quickly. I recommend including the following as a standard list of agenda items. (You will find that you may not to review or discuss each item in every review, but by using the list you won't neglect any important points during the review.)

    Here is what I recommend is what I recommend.

    • Quantitative Metrics: Assess performance using quantitative data, such as on-time delivery, quality, cost savings, and compliance with service-level agreements.
    • Qualitative Factors: Consider communication, responsiveness, flexibility, and collaboration.
    • Contractual Compliance: Verify that the vendor adheres to contractual terms.
    • Identified Issues: Address any identified issues, root causes and remediation plans
    • Innovation and Continuous Improvement: Evaluate the vendor's contribution to process improvements and innovation.
    • Discuss any upcoming vendor deliverables (due diligence questionnaire or documents, expiring documentation, insurance certificates, etc.
    • Ask about the vendor's internal environment. Have there been any changes to key personnel, material processes, or business continuity plans?
    • Ask the vendor for feedback: What can we do to be a better customer, save money, or improve processes?
    • Contract Reviews - when appropriate. (It is a best practice to have a formal contract review at the midpoint of the contract term to identify any potential changes that may need to be negotiated and to ensure there is ample time for the negotiation process)

    Tips for successful reviews

    1. Establish review cadence and expectations – share with vendor and stakeholders
    2. Schedule all review meetings for the year (yes, the dates may change but putting them on the calendar helps keep them top of mind)
    3. Standardize a review scorecard or dashboard. Keeping a consistent format allows you to better track risk and performance review over time. Complete the dashboard a few weeks before the review and share with the vendor – they will need time to review and formalize a response to any issues.
    4. Dedicate time on the agenda for your vendor to provide feedback, suggest improvements, ask questions, tell you about new products or services.
    5. When the review is completed send a summary of any issues or action items to stakeholders, archive meeting materials with the vendor record, and let stakeholders know where to find final materials (vendor decks, scorecards, etc.) should they require them.

     

    As for the format for SOP (Standard Operating Procedure) or a Program document. I would recommend the following

    1. A link to your policy
    2. Define vendor risk management
    3. Define what vendor is (third-party, vendor, supplier, service provider)
    4. Describe your organization's approach to vendor risk management.
    5. Detail oversight and governance roles
    6. Detail stakeholder roles (vendor owner, vendor risk management, subject matter experts, vendor, etc.)
    7. Follow the vendor risk management lifecycle to describe each process, outline the objectives and requirements for each process. It is a best practice Provide a R.A.C.I (Responsible, Accountable, Consulted, and Informed) chart for each process to help stakeholders clearly identify their roles and responsibilities in each process. Include any timebound requirements for each process, for example Critical and High-Risk vendors must be risk-reassessed on an annual basis and must have a formal risk and performance review each quarter.
    8. Identify the evidence to be retained (completed risk assessment, vendor risk review, performance scorecards.) and let stakeholders know how to access specific procedures to complete each process.

    Onboarding

    ·         Planning

    ·         Risk Assessment

    ·         Due diligence

    ·         Contracting

    Ongoing

    • ·         Risk re-assessment and due diligence
    • ·         Risk monitoring
    • ·         Performance Monitoring

    Offboarding

    • Termination
    • Exit plan execution
    • Administrative details (archiving records, updating vendor status in various systems, etc.)

    Other information to include

    • Systems information (official systems of records, how to access them, etc.)
    • Issue management and escalation
    • Exceptions process

    That should be enough to get you started!

    I hope this information is helpful, but I would love to hear ideas and practices from other members.




  • 3.  RE: Business Review Efficiencies and Frameworks

    Posted 02-13-2024 11:13 AM

    Hi Hilary,

    Thank you for this insight and I appreciate it!  Seeing the portion about inquiring about changes internally with the supplier is a process I have not seen before but may help further.