- Signing the contract is the start of your relationship with the supplier, not the end.
- Managing the arrangement helps deliver value for money and drive the best from the supplier relationship.
- You should lay the foundations of your relationship with the supplier before the project or contract begins.
- You should then constantly asses and refine your processes to make sure the relationship works well.
- You should use your relationship with the supplier to plan for your next procurement.
The goal of managing suppliers
Signing an agreement with a supplier isn’t the end of the procurement process but the beginning of your ongoing relationship with them. While you need to manage the contract to make sure the supplier delivers what they have committed to, strong supplier relationships can deliver additional value and benefits beyond the contract.
M1 Implement arrangement
Between signing the agreement and starting the project, aim to lay the foundations of a successful relationship with the supplier.
To do this, you should:
- define the right level of internal resources and management depending on the importance and complexity of the arrangement
- ensure the smooth transition of services, especially where there is a new supplier
- work with the supplier to establish systems and processes and determine who’s responsible for key tasks and activities
- engage key stakeholders and communicate the details of the new arrangement to them.
NSW Procurement resources
- Contract management plan template DOCX, 919.82 KB
- Contract management plan (supplier) template DOCX, 896.77 KB
- Exit plan XLSX, 177.46 KB
- Transition plan XLSX, 181.64 KB
- Communication plan template DOCX, 933.47 KB
M2 Manage arrangement
Your goal should always be to deliver value for money and drive the best out of the supplier relationship. To do this, you should:
- maintain the right level of governance and resources depending on the importance and complexity of the arrangement
- coordinate with the supplier and key stakeholders to manage performance, drive continuous improvement and encourage innovation
- track and report on the benefits to demonstrate that the supplier is delivering value for money.
NSW Procurement resources
- Benefits realisation plan(link is external) DOCX, 128.24 KB
- Benefits realisation register XLSX, 168.53 KB
- Supplier performance report DOCX, 914.56 KB
- Supplier performance report XLSX, 178.81 KB
- Contract extension letter DOCX, 163.43 KB
- Deed of variation DOCX, 52.98 KB
- Supplier relationship management guidelines PDF, 553.86 KB
- SRM strategic meeting template DOCX, 78.17 KB
- SRM business review meeting template DOCX, 78.66 KB
- SRM tactical meeting template DOCX, 77.69 KB
- SRM operational meeting template DOCX, 78.96 KB
You should be considering your strategy for the next arrangement throughout the manage stage. This means constantly planning for renewal.
By continually assessing and improving your procurement strategy and processes, you’ll help provide the best possible outcome for the next arrangement.
Before the contract expires you should:
- open a dialogue with the supplier and internal stakeholders on the strengths and weaknesses of the existing contract
- begin a demand and market analysis that will inform your next procurement strategy.