The biggest mistake clients make when dealing with outsourced vendors

You probably think I am going to say the biggest mistake clients make with their vendors are; not building the best contract with the strongest service levels, not negotiating the best price, or lack of governance. Each one of these points is very important to us as a client; however, it's not going to drive the overall behavior you are looking for. The single biggest thing that clients do that tears down their relationships with their outsourced partners has nothing to do with any of these things. It's simply in how they treat their vendors.


I have seen it time and time again in the past 12 years that I have managed vendors, it's pure and simple. The manner in which a client treats their vendors is what will make or break the overall relationship. Yes, as clients we pay our vendors to do a job, perform a service, manage part of our business but this in no way lets us off the hook, nor does it give us the ability to consistently point figures at our external partners. We talk about partnership but so often we as clients use this word when the mood strikes, or when the vendor has done some amazing thing for us, but often we revert back to using the word vendor when we feel less than happy with their performance.

Partnership as the dictionary states is:

A relationship between individuals or groups that is characterized by mutual cooperation and responsibility, as for the achievement of a specified goal.

Partnership has to be consistent in its commitment to work together to succeed.

Think about this for a moment; you need a partnership to build a good business together, we hire these folks to help us in our businesses every day; we trust them with our most precious possession but then why do we not listen to them when they try to give us clear feedback on our own shop? Part of growth in human beings and in business is listening to what you may be missing in yourself that someone else can see from the outside. Growth is hearing what we don't really want to hear, accepting it, facing it and making the real attempts to change it. Maybe there are cracks in your own business that the vendor can clearly see from the outside; why wouldn't you want this type of feedback? Above all, how many vendors will give you this feedback? Many won't if there is not a level of trust where they feel comfortable enough to share candid feedback. That in itself is a tragedy.

Yes, we are paying our vendors to perform a service but if we started to listen to them with an unbiased mind I believe it would help grow our capabilities on both sides of the fence. From this approach perhaps will emerge more innovation, savings and consistency in our day to day dealings.


What if, in your personal life, your partner always treated you with mistrust, secrecy and even disdain at times? Even thinking about that for a moment will quickly answer your question...partnerships in business are affected in the same manner. A relationship that is exposed to that type of treatment will deteriorate very quickly over time. When one party feels like the rug could be pulled out from underneath them at any moment or is consistently being threatened with the fear of love being taken away (the business) it just further breaks down the partnership to a place of pain and mistrust leading to blocked communication built out of fear and resentment. What your final result is, is a relationship that is built around lack of trust, good will, listening and ultimately a stalemate of communication...once communication ceases it's a long road to breathe life back into it.

If there is one thing you can learn from your vendors it is to listen to them. Hear what they re telling you about your business. Do you need more resources, is there a lack of accountability, processes or follow-through? Talk to your vendors, shine a light on what they do well and don't just criticize on the low points.

Remember, I am the client, I have been the client nearly my entire career. What I feel helps me stand above in terms of managing relationships in business is my ability to see both sides of the street, to hold my own team accountable and to make sure we have our business in order before I start pointing fingers at our external partners.

Outsourcing components of business is primary to many of us and getting the most out of those relationships is what we all strive towards. Keep your eyes open in order to become highly adept at recognizing the changes needed in your own business while still managing your partnerships with clear governance, respect and communication!

Build teams not islands.