Having third-party vendors has lots of benefits, but it's not always easy to manage those relationships. In this post, we'll be talking about how to have the most successful relationships with outside vendors or partners. From negotiations to risk management, here are a few tips we've learned along the way.
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As part of our Strategies for Success series here on the blog (our first post in the series was about successful budgeting), we're focusing today on how to build and maintain healthy relationships with third-party vendors. As a financial industry professional, you probably have relationships with external service providers.
These relationships can be extremely valuable, but they can also be challenging. What if something doesn't go to plan? How can you negotiate cost? What are the risks of working with this company?
Here are five key best practices that will help ensure that your financial institution has successful relationships with third-party vendors.
As a current Customer Success Manager at TRUPOINT, my whole job is building healthy, productive relationships with our clients and making sure they're happy. In this role and prior ones, I've learned exactly how important these factors are. Let's get started...
1. Maximize Current Relationships by Leveraging Full Functionality
You go to a lot of effort to build a relationship with a third party. Are you making the most of that effort?
To help answer that question, consider if a company you like working with does other services that you're currently leaning on a different vendor for. If there's not a good reason for the duplication, it may be time to consider consolidating to just one partner.
By leveraging the full functionality of a single vendor, rather that multiple similar vendors, you're increasing efficiency, and may even be able to negotiate a better price for switching to them.
(If you're a current TRUPOINT customer, please know that we're doing a lot of exciting promotional campaigns to hit our 2018 goals. We really rarely offer pricing promotions, so it's a good time to talk to your Customer Success Manager to learn more about other ways we can help you.)
2. Keep Lines of Communication Open
Every relationship hits bumps in the road. By keeping lines of communication open between your financial institution and your vendors, you'll build trust and be able to navigate those challenges more openly.
For example, if you're looking for a functionality that doesn't exist, don't just assume it will never exist. Talk to your vendor to see whether that enhancement has a place in their future roadmap.
TRUPOINT customers can always submit ideas, or reach out to their Customer Success Manager to learn about future plans.
In addition, if issues arise, it's best to have good working relationships with your vendors. That way, you can work together on solving them efficiently and with ease.
3. Consider Risk Management
Third-party vendor risk management is a hot topic in compliance world. While we don't want to focus too much on the nitty-gritty of it, we do recognize that it's a big factor in any vendor decision.
While your risk management processes will depend on your institution, do make sure that your vendors understand the purpose and value of those risk management efforts.
Finally, streamlining your vendor relationships will also help simplify your risk management.
4. Seek a Partner That Will Grow With You
As your business grows, your vendor relationships should grow with you. Your company's needs will change over time. Can your current vendor suite help you achieve those goals?
In addition, your provider should grow beyond just solutions. They should have expertise in their field and provide you all the best insights they've uncovered, so that you can leverage those cross-industry learnings in your own business.
5. Focus on Value
Sometimes cost can be an overwhelming consideration, looming over everything else. While it's really important to make sure you're getting a good deal - more on that in the future - it's most important to focus on value.
Think about all the different things you're getting from the relationship - time savings, personnel costs, and more. Then, consider this in terms of the financial cost of the product itself.
If this is an important factor for you and your financial institution, here is an interactive infographic that illustrates the point.
TRUPOINT Viewpoint: As a company that provides compliance and growth strategy solutions to financial institutions, we know how difficult vendor management can be for you. For most finance professionals, it seems to fall somewhere between "necessary evil" and "mountain of paperwork." That's why we are so focused on delivering true value and making sure that any relationship you have with us is worth the effort.
I'm a Customer Success Manager, and I can attest to the fact that this company is dedicated to ensuring that you have a wonderful experience working with us, get data-driven insights out of every analysis, and are able to continue learning and growing every day.
If you've every wondered about what it would be like to work together, now is really the time to reach out. We're shooting for some ambitious 2018 goals, and rolling out all kinds of promotions to get there.
Whether you're new to us or interested in expanding your partnership, you're going to like what you find with TRUPOINT.