Conducted effectively, reference checks are a great way to do away with the smoke and mirrors that often accompany RFP responses and pitch presentations. Ineffective reference checks, however, won't pay off. They'll waste time and serve as an unnecessary roadblock between your organization and its strategic objectives.
On this week's episode of the Source One Podcast, Brian Seipel offers his tips for carrying out effective supplier reference checks.
Seipel opens with a helpful reminder. "Not every reference," he says, "needs to be checked." He suggests that Procurement vet references the way they would a supplier to ensure they focus their efforts effectively and engage in productive conversations. While new clients will have a lot to say about implementation, they won't provide much insight into the costs and benefits of a long-term relationship with the supplier. An effective reference check will see Procurement identify stakeholders who've truly spent time in the trenches with the supplier.
Finding the right references is only part of the battle. Seipel goes on to offer best practices for conducting conversations with these key stakeholders. Right off the bat, he cautions Procurement against looping suppliers into these discussions. Though it seems like a no-brainer, Seipel remarks that suppliers will often try to work their way in. This intrusion eliminates the possibility of a candid, objective exchange.
It's essential, Seipel reminds listeners, for Procurement to guide its conversations with supplier references. By asking for specific examples and employing 'gut check' questions (what does the reference wish the supplier did better, for example) organizations can ensure they exit conversations with actionable insights.
Seipel concludes by urging listeners not to conduct reference checks in a vacuum. "Don't forget to apply what you've learned," he says. A reference check is only truly effective if Procurement leverages its findings to address concerns and establish stronger, more strategic supplier relationships.
Subscribe to the Source One Podcast today to hear the rest of Seipel's tips for ensuring supplier reference checks aren't a waste of time.