I was helping an organization to finalize an ad agency for a new product. The attitude of the CXO was of – ‘there are so many agencies I can get any one of them.
The same brief went out to a few of them. At the pitch, the CXO realized what he was missing. The array of ideas stupefied him. To be fair, he accepted his mistake.
This is a stereotypical manager who thinks that all those who provide services and products are ‘vendors’
Ideas, products, and services are becoming more complex and sophisticated. With increasing complexity, organizations need to work together with external organizations to offer a seamless experience
So “suppliers/ vendors” are not just suppliers but “partners” and “collaborators”. It is more strategic & less transactional. You need partners who are in alignment with the values & culture. Scott McNealy, ex-CEO of Sun Microsystems, infamously tweeted -“Most overused phrase in business is ‘strategic partner.’ Favourite partnership for me is a purchase order. Defined charter, beginning, end.”
Move over Scott, we know why exactly your external relationships failed. True partnership is much more than a purchase order. Proper value is never got from such a relationship.
Unfortunately, a PO gives an artificial control to the issuer; a kind of a king servant relationship – a bane of a successful partnership.
A purchase order gives a tightly defined set of deliverables but in an open-ended collaboration, it is much more than that. In a complex market, it means working alongside each other and tackling uncertainties, in the environment, in technology, etc.
Usually, it is large firms play the PO card to allow vendors to spar against each other. They want to hold the steering wheel.
There are many examples of successful partnerships
Last but not least – we know where Sun is…..In some corner of Oracle!
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