A big part of information technology is IT vendor management.
As companies grow, the number of vendors grows as well and unless effectively managed, relying on a number of vendors can increase complexity and business risks, while letting operating costs spiral out of control.
In these situations, companies run the risk of “shelfware” or software solutions that are purchased but left unused or underutilized. SaaS solutions, if not responsibly managed, can introduce data security or privacy risks.
When it comes to ISP and telecom solutions, chaos sometimes reigns. It is not uncommon for organizations to end up with numerous different telecom and network suppliers between various company locations and departments.
When things break, companies can really lose time and productivity. Vendor risks come in many shapes and sizes, but a huge one is the time drain that occurs when internal staff unsuccessfully try to troubleshoot or resolve network outages, software conflicts, or service disruptions.
Unfortunately, high-quality customer service is a rarity in today’s business world. Smaller customers often get the short end of the stick when it comes to telephone hold times or access to qualified customer support.
In this article, we’ll take a closer look at vendor management in IT, its benefits, and how relying on it can significantly increase your bottom line.
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What is IT Vendor Management?
The solution to many of these challenges is outsourced vendor management. When companies partner with a managed service provider (MSP), IT vendor management and vendor management strategy development is traditionally included in the core service offering.
MSPs become the frontline of interaction and support for most third party vendors, including ISPs, telecom operators, cloud service providers, software vendors, utilities, and the like. Furthermore, MSPs relieve a tremendous time burden for vendor selection, while helping their clients mitigate risks with outside IT vendors and service providers.
MSPs are uniquely positioned to help their clients consolidate and rationalize vendor relationships. They are experts in the technology ecosystem, have access to the latest vendor information, and have done their due diligence on which third-party vendors and service providers deliver outstanding products and services, with the highest levels of support and equitable vendor contracts.
MSPs also understand how to integrate multiple vendors into comprehensive technology solutions. Finally, MSPs can help organizations with their overall vendor management strategy, helping rationalize costs, reduce complexity, and improve overall efficiency and productivity while following IT vendor management best practices.
5 Benefits of Vendor Management in IT
Here is a closer look at five benefits that the IT vendor management process provides for businesses of all sizes.
1. Save Time
The most obvious benefit of outsourced IT vendor management services is the overall time savings to the client. MSPs benefit from the fact that they usually manage dozens or even hundreds of similarly situated clients and all of their vendors.
MSPs also have years of accumulated expertise with vendor management systems and a deep technology bench. Their staff is well versed in managing all manner of outside technology service providers, such as ISPs, telecom operators, cloud service providers and software vendors. MSPs know the best vendors.
Moreover, MSPs are often given privileged access to premium support resources from the vendors to mitigate risks. Many vendors appreciate working directly with MSPs on troubleshooting or service issues. This is because an MSP’s staff is knowledgeable and technically advanced and together they can resolve issues more quickly.
For organizations doing vendor management themselves, this is simply not the case. Especially for smaller companies, service issues can turn into days or weeks of delays, downtime, back and forth with the vendor, long hold times, or unresolved technology issues. Internal staff can get completely bogged down in the day-to-day tasks of managing outside vendors.
2. Save Money
MSPs use the IT vendor management framework to help their clients save money on technology products and services.
Just like with troubleshooting and problem resolution, MSPs bring a ton of experience to the table on deploying the right products and services.
Specifically, MSPs know:
- What to buy and deploy
- Which technologies and services work best togetherT
- The economics of various product categories, enabling them to get the best deals for their clients
In practice, MSPs also negotiate and procure technology products and services on behalf of the client and lock in the best value for the money.
Companies going the “do-it-yourself” approach usually get none of the above. Inexperienced or unsophisticated companies will often order the wrong products and services, resulting in higher upfront costs and lots of rework.
Without the help of an MSP, smaller customers usually have no purchasing power and will often pay far more for various technology products and services, leading to IT vendor risk management issues.
3. Proactive Maintenance and Lifecycle Management
Today, we live in a service-based economy. Nearly everything is sold “as-a-service.” Even for tangible hardware products, businesses require ongoing service contract negotiations for additional functionality and support, along with multi-year warranties for hardware that may need urgent service.
In many product categories, things get complicated quickly for the uninitiated, resulting in questions that include:
- Which service subscription goes with which hardware firewall model?
- What level of on-site service and support should we get with our on-premises servers?
- And more
These are just a few of the questions MSPs help answer and manage on behalf of their clients. As service contracts and warranties come up for renewal, it is also vital that contracts be renewed in a timely fashion.
If contracts are permitted to expire, vital security services or functionality may be automatically disabled, exposing the client to cyber risks or downtime. If hardware fails or becomes outdated, getting support for it could be challenging.
MSPs take all of this complexity surrounding the IT vendor management process and shield their clients from it. MSPs have sophisticated software, workflows, and procurement systems so that service contracts and warranties are renewed in a timely fashion.
What’s more, MSPs leverage their remote monitoring and management (RMM) tools to proactively patch and upgrade operating systems and firmware so that equipment and infrastructure operates at peak performance.
Finally, MSPs are experts at proactively managing the technology lifecycle for computers and infrastructure. They lead clients through the process of methodically budgeting for hardware upgrades and responsibly managing hardware lifecycles.
This in addition to interacting with the supplier and vendor ecosystem to make sure all the necessary products and services are purchased and provisioned.
4. Greater Uptime, Resiliency, and Employee Productivity
When an organization deploys the right technology products and services, gets proactive maintenance and management, and provisions the right warranties and support contracts, IT downtime and major technology outages are virtually eliminated.
One of the biggest benefits of working with an MSP for IT vendor management services is that all the work is done properly right from the start. Having a relationship with an MSP will not eliminate hardware failures, network outages, or cybersecurity incidents altogether. They will, however, just make them incredibly rare.
When trouble arises, redundant systems kick in, backups and recovery techniques are activated. Problems are resolved quickly because the MSP is at the helm and responsible for third party vendor management.
5. Secure and Compliant Operations
Lastly, following IT vendor management best practices usually leads to higher levels of cybersecurity and compliant business operation. Most cybersecurity products today have a large service component.
The client pays their cybersecurity vendors over time, with monthly or yearly subscriptions, and in turn the provider delivers real-time updates to the product in the form of signature and software updates. These real-time updates are essential to keeping clients secure.
Today’s cyber defenses also rely on risk assessments, continuous monitoring of logs and other behavioral signals which may indicate a security breach. Many clients use an outsourced security operations center (SOC) to monitor logs and cyber defenses in real time. This is another third-party vendor often managed by MSPs.
Sound cyber defenses today require managing a team of different vendor relationships IT vendor risk management tools for layered and comprehensive security.
Interested in learning more about cybersecurity? Check out these blogs:
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Work With a Partner That Relies on IT Vendor Management Best Practices
Creating an IT vendor management policy can be challenging for businesses, especially if they rely on multiple vendors for hardware, software, security, and more. The good news is that it doesn’t have to be.
NENS makes vendor management in IT easier by delivering long-term, world-class vendor management as a core component of our managed service offering. Our team can assist you with vendor selection, managing vendor performance, and developing a vendor management strategy for your business.
We look forward to talking to prospective clients who are looking to save time and money, while getting the absolute best service and support from third-party vendors.
For more information about our IT vendor management services and the benefits they offer, contact us today to schedule a free consultation.