Are you investing in preventing breaks for your equipment or fixing it as you go?
Today’s post is by Mark Davis; Sr. Vice President of Operations and COO at SafeSourcing.
Over the past two days we have been exploring some steps our customers are taking to learn which model of repair & maintenance works best for them. Many will begin with a quick RFP to try and lock in and improve hourly rates and costs for normal break-fix occurrences while they study their internal landscape to determine which model is the right fit. Once completed, many will then look at the landscape of the industry to learn more about suppliers are doing and offering. Generally the current break-fix companies will be invited to phase to participate as well.
The third phase allows companies to standardize what they want in terms of service and gives all suppliers a chance to win the business with their best overall proposal and the incumbents a chance to add to their reputation and service with any last minute adjustments they want to make.
PHASE 3 – Lock down the overall offering
Well defined terms and conditions – Yesterday we discussed the importance of putting together a Best In Class statement of work for the suppliers to offer pricing against. By defining that in advance it will be easier to compare where all of the vendors fall on the same set of details. Just as important is define the Best In Class contract terms in advance of award of business. This would include service conditions, background requirements of the employees coming on site or payment terms for example. Having this stated up front will ensure there are no surprises for the suppliers when they are awarded the business.
Pricing by location – With the equipment defined at each location and the statement of work established, it will be much easier to collect preventative maintenance plan pricing for each location. This will account for variances in the life and type of equipment by location as well as demographics that would increase or decrease costs such as the location being located in a densely populated metropolitan area or in a more difficult to service rural area. If necessary, break up the locations into groups to allow suppliers to focus their attention.
Factor in loyalty and incumbent performance – Once pricing proposals have been collected and pencils have been sharpened as far as they will go it is important to factor in all of the value a supplier brings to the table but especially the history of loyalty and customer service on the part of the incumbents if they have been good partners to work with. In virtually every instance we will show our customers an award scenario where nothing changes on the part of their supplier even if the incumbent was not the lowest bidder.
We will conclude the series tomorrow by sharing a summary of the results our customers are seeing by taking this three-step approach and how successful those that have chosen to move towards a primarily preventative maintenance plan have been. For more information on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.
We look forward to your comments.