By Richard Hogg
Following on from part one of the Movember themed post, where we asked whether supplier A should take a haircut despite mutual recognition of over-performance, and no price increase for several years, this week we consider a different scenario, that of a buyer.
The buyer has a contract with Supplier B to deliver a complex set of products and services. During the initial contract term the performance of the supplier has been below expectations with numerous service failures, and little commitment to resolve.
The end of the initial term is looming, and the buyer has some options to consider:
a) take the easy route and simply let the contract roll into the extension period.
b) grow some whiskers, take on the short-term workload pain and kick out the under-performing incumbent replacing them with a thoroughly market-tested supplier.
Seems like a straightforward, logical choice to refresh and improve the service, however all too often the illogical path is followed due to short-term pressures and insufficient planning and consideration.
Far better to grow a mo!