NOA Masterclass - Relationship Management

Tuesday 19th April 11

Masterclass Summary

The NOA Masterclass in Relationship Management was chaired by Steve Briggs, NOA Representative for Corporate Users. Presenters from AstraZeneca UK Limited, Infosys, Royal Mail and Reynolds Porter Chamberlain used their experiences, along with case studies, to discuss this stage in the NOA lifecycle model.

Royal Mail

Antony Hayes, Royal Mail, said: “Many people believe that relationship management is a strange concept as it not something which one would traditionally think of being ‘managed’. It is really about getting the best out of a partnership for your company’s objectives.”

The presentation from Royal Mail outlined their own award-winning collaboration with CSC.

Where Royal Mail Began

• Delivery capability: service & projects

• No choice or competitive tension

• Managed to contract, mutual benefit not there

• Newly formed retained supplier management team

• Trust because our relationship management skills were immature and naive

Royal Mail Vision

• Recognition around issues and mistakes

• Openness – we shared multisource strategy, IT vision, challenges

• Contractual accountabilities on both sides met or removed if unnecessary

• Both sides performing well and engaged in terms of service and cost

• Proactively managed the relationship

What Royal Mail Did

• Acceptance of the problem – took a while, required management change on both sides

• Equivalence

• Improved and joint programme and relationship management on both sides

- internal training – all responsible for the relationship

• Engage extended team, treat as our own, in UK and India + subcontractors

• Consistency: Penalties for failures and recognition of successes

Royal Mail Tips

• Get recognition for the need to ‘manage your relationships’ in your organisation

• Accept the ups and downs. When you enter a business partnership, it is a long journey

• Use regular checkpoints, praise, incentivise and recognise staff for the efforts

Infosys

Srikanth Iyengar, Infosys, stressed the importance of the governance schedule along with culture and trust.

Goverence

• Clear metrics for measurement

• Relationship scorecard e.g. Innovation SLA

• Dedicated individuals from all sides including 1 person to manage relationship management

• Appropriate changes should be made over time

Culture

• Regular interaction between teams on the ground

• Continuity of teams – importance of stable teams

• Varying dimensions of culture. Focus on geographical and corporate identity

• Investments in training and re-skilling

• Celebrate wins and advertise war stories

Trust

• There is no substitute for performance

• Bad news does not become better over time. Be open about bad news and avoid a blame culture

• Important to develop a shared vision of the journey going forward

• Not every issue has to be dealt with contractually

AstraZeneca

Ken Morris from AstraZeneca commented on the characteristics of a contract and relationship learning.

• ‘Service Effect’ (Split of ‘What’ & ‘How’)

• Assets transferred to suppliers

• KT & Education for internal & suppliers

• Benchmarking

• Credits & Penalties for SLA’s & Customer Satisfaction

• Global Operations & Delivery

• Joint Governance

Relationship Leadership: Up-front

• Objectives

• Vendor Supply strategy

• Pricing

• Roles & Responsibilities

Relationship Leadership: On-going

• Transparency of activities

- Process Optimisation (lean 6 sigma)

• Transparency of costs

- Understanding of cost drivers (high/low)

• Overall P&L

- By Service Tower

- By Time

• Leading to collaborative working

- Customer understanding of charges and levers

- Efficiency - Stop waste, duplication, low value activities

- Redirect investment to raise value & performance

Reynolds Porter Chamberlain

Sanjay Pritam and Peter Lumley-Saville, Reynolds Porter Chamberlain, emphasised the importance of getting the contract right. A contract should be used as an aid in relationship management and promote openness, flexibility, fairness and integration.

Sanjay said: “A relationship is a fundamental human thing and it will ultimately bring issues which will need resolving. Communication is vital and the contract should be used as a framework - an organic structure in practice. There is no contractual cure for a bad deal.”