Third-party relationships require TLC
By Staff -- Modern Materials Handling, 6/1/2006
Business relationships with third-party providers don't simply take care of themselves. After the contract is signed, both companies—the client and the provider—must dedicate time and effort to managing the relationship.
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Elijah Ray |
"With these multimillion dollar relationships, it's important to have a system to manage the relationships," says Ray, senior vice president at UTi Integrated Logistics, a third-party logistics provider. Most companies have systematic processes for selling their services, he says, and should also have systematic processes for managing their relationships.
Hehir, director of logistics for Georgia-Pacific, a manufacturer of building materials and paper products, says a relationship management system should include regular business reviews where partner companies discuss past performance and future expectations.
Before sitting down for a review, says Hehir, companies should agree on performance metrics. "Be sure you're clear on what you're measuring and how you're measuring it," he says.
Hehir also recommends that partner companies create as many human connections as possible, with multiple people from each company interacting on a regular basis.
Both presenters agree that partnerships are more successful when companies take the time to understand each other's business goals and business cultures. "If you understand my mission and my values," says Ray, "then we're going to be more effective together."
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