Suppliers and clients can lose sight of what their relationship entails. Part of the solution involves an engaged client willing to hear constructive feedback, writes Bradford Keen.
4 April 2018 | Bradford Keen
Have you ever walked in the wrong direction on a travelator at the airport? You need to expend a lot of energy just to stay in the right place. This is the analogy Simon Rhind-Tutt, founder of Relationship Audits, uses when describing suppliers in the client-supplier relationship.
According to data from Rhind-Tutt's audits, the best providers of service over the past five years are those that have "never assumed they're the client's business partner".
"What happens, in many cases, is that you win a new contract and people think 'great, we're your new business partner'. No you're not. You have to earn the right to be called a business partner," he says.
This attitude is also taken by Kirsty Price, head of client relations, UK & RoI at Sodexo, which implements a 'Client for Life' strategy. It goes further than having a key account management process; the strategy "provides additional checkpoints and interventions designed to check how well we're living up to our clients' expectations and understanding what's important for them".
Many large providers rely on a best-practice communications model that sets out monthly meetings followed by additional sit-downs with key stakeholders on a quarterly or fixed monthly basis.
Effective account management systems should have operational teams constantly checking whether they're meeting client's expectations and how they can improve.
Price and her team, however, go beyond the operational. The conversations are about "the risks and opportunities that threaten the engagement our client has with Sodexo".
The challenge with this approach is convincing time-poor clients why an additional meeting is necessary and not just more of the same discussion they've had with the sales or operational teams.
The supplier needs to be able to demonstrate why the client should be more engaged, Price argues, but says greater engagement from clients about how services are being managed and delivered results in the operational team being better able to adjust service delivery and skill provision.
For Chris Jeffers, chair of BIFM's Procurement SIG, an unengaged client suggests a "fundamental misjudgement of the value FM services bring".
"There are still clients who view FM procurement and contract management as a transactional process, rather than taking a moment to look deeper at what services are being provided, how, and what positive effects they have on the client organisation," Jeffers says.
Of course, to help clients understand this, suppliers need to deliver best practice transparently and openly, Jeffers adds.
Times are changing
Two decades ago, the prevailing culture was 'us versus them', with the client as king, says Beth Goodyear, owner of FMHS Consultancy and FMP360 strategic consultant. But these days, things are changing.
"For a client-supplier relationship to work, there has to be respect and trust between both parties," Goodyear says.
"Unfortunately, not everyone is on board with this philosophy. Without doubt, things have moved in the right direction and we've seen a definite shift in the last few years."
This doesn't transfer responsibility to the client, though. Suppliers need to adopt the 'standing in your customers shoes' ethos.
"Questions being asked should reflect what's important to the customer," says Goodyear, "and because this will change during the life of a supplier contract, so should the questions being asked. A 'fixed' feedback loop doesn't work and runs the risk of people getting bored."
Communication helps suppliers and clients see their different motivations. "A supplier's goals may appear performance-driven, but are often underpinned by the need to contribute to the organisation's bottom line," says FM professional Ian Hopkins. "The client, meanwhile, needs to make efficiency savings, but not at the cost or risk of failure to deliver overall compliance or affect service standards.
"Having a wholly engaged client would always be my preference, rather than one that adopts an 'exception-only' bias for any communications, where risk and failure are the two drivers and underpin communications that are generally negative from the onset."
This is why the FMP 360 approach is valuable, says Goodyear, as it stimulates multidirectional feedback and dialogue. With this information, a solution can be moulded to fit the client rather than the other way around.
Price implements something similar: "What we're trying to do is take standings across a wide range of critical stakeholders who will have a different view of the service, depending how close or how distant they're from it."
Feedback helps clients grasp the economic model FM works within, shaping their expectations of suppliers.
"An informed client who understands the organisation he works for, the services required, and the sector-specific challenges should be very open to issues the supplier has," Jeffers asserts. "This does not mean he will roll over and accept variations or changes to the agreed operating model, but it does mean it is down to both parties to foster a collaborative way of working."
Continual feedback is an effective means of promoting a more collaborative relationships, but "it's just another thing in the toolbox to ensure both parties remain aligned," Goodyear says.
Building trust is key
Despite efforts to facilitate positive relationships, disagreements will arise. "It's possible to feel 'shackled' by the strict confines of some contract specifications," Goodyear admits, "but it's essential that both parties are open to being challenged by the other in a constructive way."
Constructive challenges can only be orchestrated if the foundations of the relationship are built on trust. "You can't make people trust one another," Goodyear says, "but if both parties regularly communicate what's working well and what needs to change, it not only means change happens more quickly, but the positive stuff gets an airing too."
Trust helps both parties respond better to the truth, suggests Hopkins. "Hearing the good, bad and anything in between grants access to a "truer, more reflective picture of the actual service delivery that a client is receiving and paying for". Carrying out the relationship in this way allows it to be assessed and benchmarked against the contract scope throughout.
Trust, like love, doesn't come easy. It requires effort and attention.
"The more you understand what's important to a client and deliver on it the more likely you're to build up an element of them trusting you," says Price.
"It is surprising sometimes how we all get so focused on delivering what we need to deliver that sometimes we need to create the space to say, 'What's the strategy? What keeps you awake at night? What are you're concerned about in the future?' Only then can you think about helping [clients] to achieve their objectives quicker and easier," she adds.
Suppliers, for the past 10 to 15 years, have chased client satisfaction, but they should focus on client commitment instead, contends Rhind-Tutt. This can be measured by the client's intention to keep working with the supplier in the future, as well as their opinion of the supplier.
"If you have a committed client, you can virtually write revenue against that because they're extremely happy," he says.
Even with this approach, clients will still go out to tender, but this is good business practice, says Price. It's not necessarily about client dissatisfaction, but rather them assessing their suppliers' provision.
During a relationship, clients may wonder what else is available in the marketplace. Suppliers have to bring ideas, updates, data and suggestions constantly "so you're able to apply the science behind why you're suggesting a change," argues Price. "Then when it comes to tender, as the incumbent supplier, you're in the best possible position to retain that piece of business."
Even with an attentive supplier and engaged client, the relationship can break down, but it's up to the former to provide remedies. Rhind-Tutt says suppliers that can quickly tackle and resolve problems are more likely to experience greater client commitment.
"If you're going to be a world-class supplier you need to have flexible working methods that adjust to how your client works," says Rhind-Tutt. "Assuming the way an organisation or an individual wants to work will always be the same can be dangerous for any supplier's business."
Breakdowns in relationship tend to begin in the tender and mobilisation stages, says Hopkins. Pressure to win contracts is getting more intense and contracts can effectively be 'bought' as margins are squeezed to beyond breaking point and risk is ignored.
"Most FM contracts, hidden within the small print, allow the client to remove any member of the supplier staff at will, for no substantial reason," Hopkins says. "The operational teams are under pressure from the first day, especially on a second-generation outsource or where TUPE generally does not improve perception
Clearer contracts and mutual understanding are vital for developing positive client-supplier relationships, but so too is streamlining procurement processes.
"Procurement teams need to understand and not waver from the core principle that FM is not price-driven, but value and service-driven, Jeffers argues. "Procurement needs to embrace technology with the use of e-portals, [which] offers a transparent audit trail that helps both parties, and reduces human error in the process."
The process needs tidying up and standardising across the industry, Jeffers says, suggesting the government help by streamlining procurement routes, providing advice and price thresholds, and promoting longer-term relationships.
Better processes and more engaged clients are aspirational, but this will not and should not result in a "cosy relationship" according to Price.
"There needs to be a tension in a very positive way that enables you to challenge the clients' thinking, to help them think through why they're doing what they're doing, and whether or not a change would be useful," she says. "I don't think it delivers a raft of clients who are easy to deal with, it creates more opportunity for you to have client relationships where both partners are equally invested in making it a success."
Creating a culture of 'constructive challenge' and ongoing feedback won't mean suppliers can stop struggling against the travelator, it just means the client will be walking alongside them, offering a few helpful tips along the way.