“Decisioning” is a new buzzword for leaders and managers. Some may call it making a choice or discerning the best outcome, but whatever you call it, the process is critical. Unfortunately, decisioning, whether in business or life, is not taught in school. In the supply chain world, it is common to see issues and even fiascos because the wrong decision was made on a partner, equipment, software, team, etc. Therefore, it is critical that you go through a proper “decisioning process” before discerning what steps you take on large projects.
Reviewing the process and referring back to the initial criteria developed for the decision avoids impulse or emotional buying. The process below will work for identifying partners, equipment, or software.
Decisioning Process Suggestions
1. The first thing you need to do is document is the scope of the project, the objective of the project, the return on investment desired, and the budget.
2. Develop a selection criteria. Once you have the criteria that is important to you, prioritize the criteria and give it some weighting. This is very important at this stage but becomes even more important at the end when a decision must be made. Usually, by then, an emotional decision is taking over. Make sure you go back to your initial selection criteria and confirm your decision is in sync with this criteria. Some criteria may be functionality, design specifications, integrity, customer service, financial viability of company, reputation, or best product, just to name a few.
3. Develop a time frame to get your proposed list of vendors and their pricing done, followed by a selection of your partner. Be realistic! One of the biggest issues in projects affecting the supply chain is people trying to do a six-month project in two. Do not try, unless positively necessary, to cram in a project right before peak season.
4. Do your research. Develop a list of possible vendors. Look at industry reports, analysts, etc. to confirm your list is a strong one.
5. Send out a Request for Information. You will need to give a definition of scope if you desire to have some budgetary numbers returned. Pricing on services contracts should be included.
6. Compare your results with the criteria you developed for decisioning. You may require additional information to be able to make a decision. Try to get the information as apples to apples as possible.
7. Talk to industry peers and industry SME (subject matter experts) find out what you can about each vendor.
8. Make sure all vendors have your vertical expertise. If they don’t, make sure they have done similar operational flows at customers’ sites. See for your own eyes those sites and question not just the executive, but the actual users of the product.
9. Create a scorecard and compare to your selection criteria. Weight the priorities that are important to you and downsize your list.
10. Once you have seen the product, review the plans and process of each vendor, along with pricing. If there is no clear winner based on your criteria, you may have to go back to the drawing board. Don’t be afraid to call back in someone that didn’t meet the short list. Some- times the best solution may be someone that is not as “sales pretty.” Selecting a vendor is much like a beauty contest. They are putting their best foot forward and only telling and sharing the good stuff. It’s up to you to unearth the “real truth” about each vendor.
The time has come to select the right partner for your future. Your decisioning plan has been in place, but many times at this stage, buyers tend to get emotional and want to make an emotional decision. Recently when I asked a company how they selected a company for their project, the manager said, “We just went with the biggest company in the space. No one ever got fired for selecting IBM.” This isn’t your grandfather’s supply chain, you need better decisioning than this old adage.
Lastly, when the product, service, or software is coming up for renewal, don’t automatically renew. YOU are not captive and have the option of selecting something else. Many people are really not happy with current suppliers but continue renewing the service because they feel they are stuck or it’s too much trouble to switch. Crazy, right? If you are experiencing poor customer service or it takes too long to get items fixed, it’s critical in this fast-paced world that you find a supplier where YOU are valued and the customer service reflects your value to the supplier. All suppliers are not alike when it comes to customer service, and even leaders in the industry fall down on this area.
