In 2015, I was invited to write an article for the September/October issue of Western Banker on technology. The title of the article was “Managing Technology Service Provider Relationships”. I focused on the steps a financial institution should take to maximize its relationship with technology vendors, especially its core processing vendor. In that article, I covered many actions to be taken, such as understanding your contract (see related blog Technology Contract Review: What you Don’t Know Can Be Costly), discussing your service expectations with your vendor, and owning the relationship. The last part is essential, especially since I see so many instances of vendors failing to provide leadership as a trusted and valued partner.

It is especially timely at the beginning of a new year to take ownership and set the agenda for the year. A new year always begins with new internal expectations, new goals, and objectives to be met. No doubt your institution has targets to achieve in 2020. Many, if not all, of those have been communicated to the Board of Directors. Unfortunately, vendors seldom are aware of these objectives because they seldom ask. If your vendor hasn’t asked what your institution’s goals are for 2020, don’t you think that you should share those with your vendor? Own the relationship! In my 2015 Western Banker article, I suggested that if your vendor is not asking to meet with your senior staff to discuss the institution’s goals and objectives, then the institution must insist on having this discussion. It may be as simple as “we want to increase non-interest income” or “we want to grow our market share” or “we want to drive greater digital usage with our customers”. Actually, none are all that simple. But your vendor may have solutions that can help your institution achieve success. Then there are the more strategic areas that must be shared, such as “we will open a branch in 2020” or “we are intent on making an acquisition in 2020”. Both of these are more involved, and in each case your vendor will be instrumental in successfully executing either, but more so the latter. When that discussion occurs, it is also time to discuss, in general terms, the vendor’s charges for acquisition support. Vendor acquisition charges can be staggering for an institution that has not been confronted with them before. It is best to address it early and discuss alternatives to potentially reduce charges to the institution.

Now is the time to take ownership and set an agenda for your vendor to follow for 2020. Waiting on a vendor to take the lead on goals they aren’t aware of seldom brings success.

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