To expect disappointment is probably the last thing that you expect to hear in a time when you are bombarded with positive thinking coaches and every form of social media telling you to ignore anything that sounds remotely negative. But the fact is, that even if only at a sub-conscious level, everyone has expectations and when it comes to outsourcing, they tend to be high.

The major issue in outsourcing is that people attempt to create a partnership and in any kind of partnership, both parties have their own expectations. Unfortunately, outsourcing relationships are based on an intensely short period of defining expectations (usually by the customer), followed by the supplier/vendor responding with an offer to meet those expectations. The supplier’s expectations are usually ignored or hidden in assumptions and pre-requisites.

Steering a supplier though reports is a recurring area of unfulfilled expectations. An RFP process tends to list existing customer reports, supplemented with the option to gain access to raw data for further analysis. Both parties agree to define further details during the initial transition phase as the supplier takes over and a contract is born! The customer now believes that their expectation of being able to receive any and all necessary information about the services is locked in. The supplier however has different expectations. A supplier has a default standard set of reports which can only be provided after everything has been transitioned into their systems and time has passed to create data for the report. The expectation here is that the customer will be happy with what is given, when it is available. Months pass by and the transition ends. The first report is produced without the expected discussion or modification happening and the customer requests changes or additional reports. The supplier insists that changes to the reports need to be paid for whilst the customer is still waiting to be consulted on their needs. The customer is disappointed that the reports are late and even worse, do not contain the information they need! 

Other examples can often be found in the areas of system monitoring (expecting more than just the default sub-set of alerts/thresholds to be monitored), consumption reporting, availability of experienced resources and innovation. These are notorious areas where customers complain that their expectations have not been met.

So, how do you communicate your expectations and get positive confirmation that they are understood and will be met whilst negotiating a contract in as shorter time as possible? You don’t! There is no silver bullet to kill this monster of a problem. The traditional approach to knowing that a customer will, at some point, be dissatisfied is to include escalation matrices, governance bodies, and CSAT surveys. So now, more layers of management need to be involved, more information is lost in summarizing expectations to an ever-higher level of abstraction, often resulting in frustration, commercial discussions and all-round disappointment.

Unfortunately, the above is often driven by suppliers being eager to achieve a steady state of operations as quickly as possible, whereby their P&L can be improved by further change requests. This is not likely to change, so how can disappointment be reduced, and expectations be achieved? Here are some suggestions to try in your next RFP:

1. Don’t front load all expectations into the initial transition. Insist that the original transition budget is split 80/20 (for example) with two phases whereby the second phase is a review and ‘meet expectations’ wrap up, planned 6 months after the initial transition phase is completed. This avoids commercial pressure and allows the supplier to deliver their default capabilities, avoiding unnecessary customization.
2. Include a mutual contract training obligation into the agreement. During the transition period both parties will co-develop a training to explain the expectations of the contract in layman’s terms and the same training is given to both parties.
3. Strictly avoid any clauses that state ‘to be agreed during transition’. Defer any such requirements to the review period post initial transition.
4. Draft a reference document that explains the ambition of the agreement, rather than the precise deliverables as a supplement to the contract (referenced, but not binding) which can be used to express expectations that may not easily be worded in contractual terms.
5. Agree strict KPI’s for revising contract language. Most contracts simply define a process and a response level. Very few actually have KPI’s to complete contract changes. This is actually strange considering RFP’s do have enforceable deadlines, but contract changes typically do not.
6. Whilst many RFP’s attempt to involve the future delivery staff in the final stages of negotiations (often asking the supplier to include the proposed delivery lead), this is usually nothing more than a token gesture. Insist that at least 50% of the negotiations team (sales people, consultants, etc.) remain available for at least one year post signature as these are the people who discussed and knew the expectations.
7. Define a restrictive governance structure in which resolution at the lowest level is promoted by including and enforcing penalties for unnecessary escalation. For example, incidents arising from ineffective monitoring require adjustment of threshold monitoring. This must be agreed and completed at the lowest level of operational governance. Such issues should never be escalated for resolution to tactical or strategic level boards (maybe only for informational purposes).
8. You cannot predict innovation needs and a supplier cannot force innovation. Choose a supplier because they are innovative, but do not try to contractually include this. Innovation within suppliers is done at the pre-sales and consultancy level, not at the delivery level. Healthy commercial competition is your best innovator even if you have a preferred supplier/partnership.

Finally, Abraham Lincoln (one of the good presidents who didn’t have twitter) quite rightly said “You can please some of the people all of the time, you can please all of the people some of the time, but you can’t please all of the people all of the time”, so expect to have some level of disappointment or abandon all expectations.