Is your supplier giving you value for money?

This charity came to me with three related problems:

• their website had been built by the same agency they had worked with for more than ten years, but the cost of the support contract was about to increase substantially.
• they also had to pay the developer whenever they wanted to make certain changes to the site, and they wanted more control so that their own staff could manage the website themselves.
• at the same time, the organisation was planning a rebrand, which meant that decisions about the future of the website could no longer be put off.

My contact was the charity's relatively new Marketing and Communications Manager. She had an IT background and already had a good idea of what she thought the organisation should do, but the charity had worked with the existing developer for more than a decade and the Board was understandably cautious about the risk of moving away from a supplier they knew.

She didn't need somebody simply to agree with her. She needed an independent review of the situation, both to establish whether her concerns and proposed approach were justified, and to give her evidence-based recommendations that she could take to the Board.

Understanding what the organisation actually needed

Before looking at alternative suppliers or deciding whether the existing support contract represented value for money, I needed to understand the organisation itself: what it did, what its priorities were for the coming year, what was preventing it from achieving them and what it needed from its website.

I also looked at the existing supplier relationship, including what services were being provided, what the support agreement covered and what service levels were in place.

But the relationship wasn't just about contracts and service levels. They had worked together for more than ten years, so there was a degree of trust and familiarity that also needed to be taken into account.

Changing supplier therefore wasn't simply a technical or financial decision. There were potential benefits to staying with a supplier that knew the organisation and its website well, just as there were potential benefits to moving elsewhere.

The issue wasn't whether the new support price was excessive. The issue was whether what the supplier was offering was what the organisation actually needed.

Giving the Board something it could make a decision from

My job wasn't to rubber stamp the Marketing and Communications Manager's preferred approach. I needed to investigate the situation independently and be satisfied that any recommendations I made were supported by what I'd found.

The first output was a review and recommendations document that she could take to the Board. It set out the current position, the problems I'd identified, the organisation's requirements and the available options, together with my recommendations.

This meant that instead of simply going to the Board with her own opinion about what should happen next, she had an independent assessment of the situation and a documented case for the recommendations she was making.

Planning what happened next

There were two strands to the next stage of the work.

The first concerned the existing supplier. There was still value in seeing whether the current arrangement could be made to work, so I helped draft an email setting out the organisation's position with a view to negotiating the proposed support cost.

At the same time, we needed to prepare for the possibility that moving to a different supplier and rebuilding the website might be the better option. With the rebrand approaching, this was also an opportunity to think properly about what the organisation needed from its website rather than simply reproducing what it already had.

I therefore produced a website specification that could be sent to potential suppliers for pricing. This meant that rather than asking several agencies what they thought the organisation should buy, each supplier was being asked to respond to the same underlying requirements, giving the organisation a much better basis for comparing the resulting proposals.

The result

The existing developers weren't prepared to reduce the proposed support price, so the Board still has a decision to make about whether it is willing to pay that amount.

Meanwhile, the website specification has been used to approach alternative suppliers and the organisation now has proposals from four good suppliers which it is assessing.

The final decision therefore hasn't yet been made, but the organisation is making that decision with a much clearer understanding of what it needs, what its existing supplier is offering, what the alternatives are and what it needs to consider before committing to either route.

The lesson

Long-standing supplier relationships can be valuable. A supplier that knows your organisation, your systems and your history can offer continuity and reduce risk, but longevity alone doesn't mean that the service being offered today is still the right one for your organisation.

Equally, a large increase in price doesn't automatically mean that a supplier is offering poor value. Price only makes sense in the context of what you're buying and what you actually need.

The important question isn't simply how much something costs. It's whether what you're being offered is what your organisation actually needs.