I hope that you have enjoyed the article “Purchasing Services: The Pitfalls, Part II.” If you haven’t been a PurchTips subscriber for that long, you can find Part I (from 2006) here.

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For many purchasers, buying services after a career of buying goods can be nervewracking. Maybe it’s just me, but I’ve always found that managing a services procurement requires much deeper analysis to feel confident that your selected service provider will perform as needed.

So that’s what these two articles are about: reducing risk and disappointments in service procurements.

As I alluded to in Part II, I recommend lenghty discussions between yourself and the service provider’s top management before making your final decision. In addition to the questions included in Part II, I like to ask about how things are handled when things go off track to get management talking.

What will it be like if I don’t hear from the key person by the time a deliverable is due?

Will I have to be the “squeaky wheel” to get things done?

After how many occurrences of late deliverables do you think that we should treat the engagement as having problems?

What type of situations would make you want to assign a new key person to our account?

Again, asking these types questions in person will go a long way towards truly understanding how much of a priority you will be to your new service provider. You can’t distill this stuff onto a spreadsheet. But with experience, you will be able to identify red flags that can help you identify service providers that may pose more risk than their competitors.

To Your Career,
Charles Dominick, SPSM
President & Chief Procurement Officer
Next Level Purchasing, Inc.
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Charles Dominick, SPSM, SPSM2, SPSM3

Charles Dominick, SPSM, SPSM2, SPSM3 is an internationally-recognized business expert, legendary procurement thought leader, award-winning entrepreneur, and provocative blogger. Charles founded the Next Level Purchasing Association in 2000, oversaw its incredible growth, and successfully led the organization to its acquisition by the Certitrek Group in 2016. He continues to blog and provide advisory services for the NLPA on a part-time basis as he incubates his upcoming business innovations. Charles is also the co-author of the wildly popular, groundbreaking book, "The Procurement Game Plan: Winning Strategies & Techniques For Supply Management Professionals."

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