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Why you should create a vendor management office [Video]

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Combining information technology savvy with legal and procurement expertise in a vendor management office can yield both better deals from vendors and strong relationships with them.

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Keeping track of bids, vendor performance, previous contract terms, alternative providers and technology differences was taking too much time for Bernard “Bud” Mathaisel as he settled in as CIO of electronics manufacturer Solectron in 1999.

Many of Solectron’s vendors were also customers, which just complicated the job politically. Seeking a more disciplined approach, Mathaisel partnered with Solectron’s assistant procurement officer, Jeff Dixon, to create a virtual vendor management office (VMO) staffed by IT and procurement employees. “The result is that the CIO could be a decision maker without having to run the process,” Mathaisel says. Now CIO of manufacturing outsourcer Achievo, Mathaisel brought that discipline with him.

Likewise, Dixon has brought it to Cisco Systems, where he is now director of enterprise software and …

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