Recession Service Management: Talking about money at the service delivery level

In this economically challenging time, I'm finding that my clients' service delivery managers are on the front lines having difficult discussions. Their companies are asking for base services from their service providers to be maintained, often with smaller overall services budgets than before the recession hit. These reduced budgets make conversations with service providers painful and become a challenge at the service delivery level when providers simply refuse to deliver the base contracted services. This is where a strong governance process really helps the service delivery team. These people often will try to take the burden of negotiating these matters into their own hands - though they shouldn't. While I think that issues should be solved at the correct level, matters of policy or basic service delivery simply can't be negotiated outside of an executive process. My advice to teams with this kind of problem is to escalate and refuse to engage in the discussion with their service provider counterparts. It's not a failure to ask for help. To maintain a good outsourcing relationship it is essential to have a governance escalation path that everyone understands, provides clear lines of decision-making and authority, and is immediately responsive to problems. How do you deal with this in your world? Can your service delivery team get immediate escalation for these types of problems? Are you seeing this discussion in your relationship? I'd love to hear how you are solving the problem, and in a day or so I will talk some more about the challenges of the service delivery team, and how companies I work with are meeting the need to continuously growing their ability and knowledge about good outsourcing management practice.About the author
Cynthia Batty is ISG’s Chief Knowledge Officer, following a decade of consulting on outsourcing governance at ISG. She brings 25 years of practical experience to advise clients on their sourcing governance and service management design, as well as organizational change management and maturity development. She is a recognized expert in sourcing governance, vendor and contract management. She has helped more than 40 governance organizations with business management and service management processes in both single-provider and multi-provider environments. Twitter: @CynthiaBatty Email: Cynthia.Batty@isg-one.com