---
name: vendor-management
description: Use when asked to set up or run ongoing vendor management — the practice of overseeing an external vendor relationship after a contract is signed — as distinct from the earlier selection stage covered by [[request-for-proposal]] and [[contract-review]].
---

# Vendor Management

Vendor management is the ongoing practice of overseeing an external
vendor relationship after the contract is signed: making sure the
vendor keeps delivering what was agreed, catching problems before they
become crises, and deciding deliberately whether to renew, renegotiate,
or exit when the contract term ends. It's a distinct, continuing
discipline from selecting the vendor in the first place.

## Key components

- **A named internal owner** — one person accountable for the
  relationship, not a committee or "whoever notices something's wrong."
  Without a named owner, no one actually watches the relationship
  between renewals.
- **A cadence of performance reviews** — regular check-ins against the
  [[service-level-agreement]] the vendor is held to, rather than only
  looking when something visibly breaks.
- **A process for handling issues and escalations** — an agreed path for
  raising a problem, who on the vendor's side responds, and what happens
  if the issue isn't resolved at the first level.
- **Renewal and exit planning** — a decision, made well before the
  contract term ends, about whether to renew, renegotiate terms, or
  transition to another vendor — including what an exit would actually
  require (data handover, transition period, alternative options
  already scoped).

## Where it fits in the vendor lifecycle

Vendor management picks up after selection and contracting end: a
[[request-for-proposal]] solicits and compares vendors, [[contract-review]]
gets the resulting agreement into acceptable shape, and vendor
management is everything that happens for as long as the relationship
runs afterward. Treating vendor oversight as finished once the contract
is signed is the most common way this stage gets skipped entirely.

## Common pitfalls

- **No single owner, so accountability diffuses** — when everyone
  touches the vendor relationship a little, no one tracks it as a whole,
  and problems go unnoticed until they're serious.
- **Performance only reviewed reactively** — checking the SLA only after
  something has already gone wrong means the organization is always
  managing incidents instead of catching a decline in performance early.
- **Renewal decided at the last minute** — waiting until close to the
  contract's expiration to think about renewal leaves no real leverage
  to renegotiate price or terms, and no time to credibly evaluate
  alternatives if the vendor isn't performing.
- **No documented escalation path** — issues get handled ad hoc through
  whatever personal contact happens to exist at the vendor, which breaks
  the moment that person changes roles.
- **Exit planning skipped entirely** — assuming the relationship will
  simply continue means there's no plan for data handover or transition
  if the vendor relationship ends unexpectedly (business failure,
  acquisition, unacceptable price increase).

## Learn more

- [[request-for-proposal]] for the earlier stage of soliciting and
  comparing vendors before one is selected.
- [[contract-review]] for evaluating and negotiating the contract terms
  a vendor is held to.
- [[service-level-agreement]] for the specific performance commitments
  vendor management measures the vendor against.
- [[budget-forecasting]] for tracking vendor spend against plan over the
  life of the relationship.