This is one of a series of blogs from Paul Weston, the architect of The Customer Framework’s SCHEMA toolset. In each blog he reveals the thinking behind the individual capabilities & practices that make up one part of the SCHEMA Capability Assessment, which is becoming the World’s leading customer management benchmarking tool. There are 110 capabilities in the assessment, containing almost 400 individual practices that together provide a comprehensive definition of what ‘Good’ looks like in today’s “Customer World”.
In the “PEOPLE & ORGANISATION” area of the assessment, SCHEMA® has a specific capability called “Managing Suppliers & Partners” and this is what it looks for:
Comprehensive customer-impacting supplier strategy
A specific strategy is in place (or at least a specific part of the overall supplier strategy) that directs the organisation’s approach to the selection and management of suppliers in areas that impact Customer Management. This includes areas that are directly customer-facing, such as call-centres and outsourced services (delivery, repair etc.) but also those which have an impact on the customer but may not represent and actual interface (Outsourced analytics, Marketing Agencies etc.). The strategy defines the functions that cannot be delivered by external suppliers in any shape or form (e.g. Regulatory Complaints) and for all other areas it steers the approaches that are acceptable (Outsource, Partnership, Insource, Overflow etc.). It also lays down critical elements that need to be included in negotiation and contracting such as ownership of customer data and whether the supplier is positioned to customers as being part of the organisation or independent but acting on its behalf.
Consideration of cultural match in supplier selection process
The selection process for any major customer-impacting supplier includes an investigation of their culture, business ethos and management style. This investigation goes beyond claims and assurances given in sales pitches and brochureware. It typically includes interviews with the supplier’s staff, publication and social-media scanning to understand a wide context, mystery shopping and examination of the supplier’s customer experience / satisfaction research. It also includes ‘exploration’ meetings / workshops between various levels of peers (management, supervisory, operational) in the two organisations to compare attitudes and ways of working.
Customer-focused service level agreements in place
Service Level Agreements are in place with all Customer-Impacting suppliers which include explicit standards to represent the end-customer’s view of the effectiveness of the relationship and the supplier as well as the commercial / internal standards needed to operate the relationship. These include explicit ‘ask-the-customer’ standards like Customer Satisfaction Research but also indirect measures that are defined as being likely to have an impact on the quality of service provided. Examples with various suppliers include staff sickness absence rates, stock levels, consistency measures, system outages etc.
Integration of partner staff to feel like colleagues
A number of schemes are in place to enable or even require staff in suppliers to come in closer to the organisation to absorb some of its ‘persona’. The techniques vary depending on the nature scale and location of the supplier and the presence of appropriate internal staff with whom they can interact. At the least the supplier’s staff are included in much of the communication that would go to internal equivalent staff and wherever possible they are able to take advantage of staff purchase and discount schemes. Wide use is also made of digital resources such as cross-organisation intranets, social networks and blogs / forums. For the most important suppliers, and where it is valuable / feasible to do so, exchange schemes are in place that range from peer-to-peer show-arounds to co-location or internal and supplier staff and even as far as senior management job-swaps.
Treatment of suppliers matched to customer perception
The organisation has a number of mechanisms to ensure that it manages suppliers in a way that matches the values and ethos it has in terms of the way it wants to be viewed by customers. These include regular briefing to purchasing / procurement teams about the brand values and service ethics that the organisation is trying build in the minds of its customers so that they can demonstrate values such as trust, respect, openness to suppliers that they manage. It also includes formal and meaningful opportunities for suppliers to review (by research and/or wide-ranging review meetings) the way that they perceive they are being managed and how the relationship is working for them.
