article submitted by Ed Welker, Director for IT Vendor Management
WashU IT spends over $10M a year on hardware, software, maintenance and services with vendors. We have many processes, often different across areas, to manage these purchases. The concept of Vendor Management at WashU IT was created by Chris Kielt to bring consistent approach to dealing with vendors, contracts and purchases. The goal is to get the best value for WashU, from our vendors, while managing risk and budget.
The role of vendor management is really about risk, scope and funds. Are we entering into an agreement that does not expose WashU to undo risk, are we getting services/product we need and are we paying the correct amount of money for the resources? What I have found is that there are many approaches for purchasing at WashU IT and IT@WashU. One of the goals of vendor management is to minimize the number of approaches to a few processes that are repeatable and consistent. I am partnering with groups like Resource Management, Software Licensing and WashU IT Leadership to ensure that all the pieces are in place before we sign any agreements. The pieces you should be sure are in place are:
- Master Service Agreement(MSA) – for larger contract purchases, setting the terms, legal guidelines and mutual protection for the vendor and WashU
- State of Work (SOW) – describes what the service or product is, how much we will pay and how long the service is in place
- Invoice – describes what we are buying in the form of hardware/software/services – it is how the vendor charges us for the SOW
- Non-Disclosure Agreement – required for some engagements to ensure that we protect the intellectual property of the vendor and they protect ours
My role in Vendor Management started on June 1. Being in place for the end of fiscal year (June 30) was excellent timing. The end of the fiscal year is when many contracts and agreements terms come to an end. Making sure they are refreshed for the new year is important to keep services, maintenance contracts and resources flowing for WashU IT. Needless to say June was very busy and vendor management became the funnel that many task went through before they were approved. I have been meeting with groups to better understand the current processes and concerns they have when making purchases. After I complete these interviews I will be putting together a consistent process across WashU IT. We will then start on an education campaign to make everyone involved in purchasing for WashU IT is aware of the process.
When asked what messages I think are important to share with you, I offer:
- Vendor Management is everyone’s job – many of us work with vendors and making sure we do not compromise WashU’s position is important
- Sales folks work with WashU to make money for their companies, they are not our friends. We are here to get the most value for WashU from the vendors. IT is business.
- Only a few people in WashU IT can sign a document that commits WashU to a purchase. They are Chris Kielt and Katherine Krajcovic. Never sign or agree to any terms with a vendor.
- Next steps – we are reviewing the current processes with the goal of creating vendor management governance, streamlined process and improved management over purchases