I continue to reflect on the ongoing saga of healthcare.gov and the myriad of problems that plague the site. I would like to address some of the best practices in vendor management that will help any IT manager. According to an article in Tech Republic, there are at least fifty-five different contractors working on this project. With so many contractors working on one project, I ask the question: who’s minding the store, and do they have strong project and vendor management practices in place?

Systems Integration

There are 112 different systems under healthcare.gov that all need to work correctly on their own and in conjunction with each other. It is difficult enough when the same group is developing and managing all of the applications, but when there are multiple contractors involved, the task becomes monumental. It takes a very strong and organized project leader who is well-versed not only in project management, but also in vendor management. Such a person is worth their weight in gold.

Vendor Management

More and more work gets done through other people and those people are often outside of your organization and outside of your supervisory control. Many people have honed their skills around project management but less so around vendor or contract management, and traditionally, we have left these tasks up to the procurement side of the organization. They can indeed manage the initial contract and talent acquisition but someone in the home organization, IT in this example, needs to be well-versed in day-to-day management of the outside resources. Are they living up to expectations? Are they playing well with the other players? Are they adhering to the standards that have been set for a particular project? A big part of vendor management is to set service level agreements.

Service Level Agreements

A very important part of successful project management is establishing clear service level agreements (SLAs) with each partner or vendor. A good SLA sets forth specific expectations for the vendor and also specific penalties, should the vendor not meet those expectations. SLAs must include periodic project milestones so that you don’t get to the end of the project and realize that vendor X is nowhere near complete. In short, the service level agreement is a measuring stick to mark progress and a guideline on how to deal with non-performance or less than adequate performance.

Thoughts

We may all be put in a situation some day where we are managing a large project that includes outside players and we have to juggle all of the balls at once. It is a skill beyond just project management and it is worth the investment to learn how to manage contracts and vendors. We may never have to deal with something as complex as the federal health exchange website, but it is a worthwhile skill to have.

Have you ever had to manage contracts and/or vendors for a project or ongoing service? What worked well for you? Share your thoughts.

About Kelly Brown

Kelly Brown is an IT professional, adjunct faculty for the University of Oregon, and academic director of the UO Applied Information Management Master’s Degree Program. He writes about IT and business topics that keep him up at night.