Creating a truely level playing field for panels of suppliers

For supplier panels, I agree with the quote below … after all, it is the premise behind River Dynamics, a company I founded in 2000 and have since sold. However, the playing field needs to be a true two-dimensional field rather than a single-dimension price-point comparison. The purchaser needs to consider all of the elements of contract management and service delivery to determine which supplier is providing the greatest value (See the previous post for a graphical view of contract management and service delivery).

Line56.com: Service Spending Opportunity

Vendor Neutrality — The Key to Sustainable ProfitAchieving initial and ongoing cost reductions requires optimizing every requisition — specifying the services needed, distributing the requisition to the appropriate pre-qualified suppliers, and allowing them to bid competitively for the opportunity. Many enterprises today have semi-exclusive arrangements for some services that hamper their ability to attain the best services for the best price on every requisition.

In addition, the high-quality vendors welcome participating in a vendor-neutral marketplace since they gain substantial benefits when they compete on a level playing field — reduced sales expenses, lower bidding costs, faster payment with far fewer disputes, and increased revenue through receiving all requisitions.

Technorati Tags: vendor management, contract management, procurement, sourcing, panel