Trust, service delivery and contract management

I have been thinking recently about the relationship between trust, service delivery and contract management. These three dimensions are loosely linked over the short term but tightly linked over the long term. For example, in the early stages of a relationship, a purchasers level of trust in their supplier is built largely on the supplier’s reputation and conduct during the contracting negotiations. The supplier’s contract management and service delivery may be abyssmal, but the levels of trust may initially be high. However, as time goes on, the supplier’s ability to deliver the services and their skill at managing the contract have a growing impact on the level of trust in the relationship.

The following diagram is my attempt to capture the dimensions graphically.

The vertical axis shows the strength of the contract management, the horizontal axis shows the strength of the service delivery and the size of the circle is determined by the trust in the relationship.

The interesting thing about the above diagram is that each quadrant has a particular circle size associated with it. The circle in the bottom left quadrant has a tendency to be small while the circle in the top right quadrant has a tendency to be large. Each quadrant is like an environmental niche that best supports circles of a particular size; although it is possible for outsized or undersized circles to live in that quadrant for a period of time.

At the start of the relationship, the circle is typically large but it can exist in any quadrant. As the relationship progresses, one of two things happen: either the large circle moves into the top right quadrant (its natural environment) or the circle becomes smaller.