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Try these 4 steps to avoid a bad relationship . . . with a vendor

In his weekly column, Maynard Webb advises founders to question everything.

Try these 4 steps to avoid a bad relationship . . . with a vendor
[Source images: gn8/iStock; Mingirov/iStock]

Editor’s Note: Each week Maynard Webb, the former CEO of LiveOps and the former COO of eBay, will offer candid, practical, and sometimes surprising advice to entrepreneurs and founders. To submit a question, write to Webb at dearfounder@fastcompany.com.

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Q. I recently used a new vendor to help me with a project. They were terrible, and I had to micromanage the situation or else I would have been left in a lurch. Obviously, I will not be hiring them again, but how do I prevent this in the future? How do you ensure that everything with a supplier is working well? I hate surprises!

—Founder of an investment firm

Dear Founder,

Well, you have hit upon one of the most important business practices, one I use every day.

Fairly early on in my career I learned an important lesson: Question everything. This is not me being pessimistic about people’s capabilities—in fact, I think people are capable of more than anyone imagines—but this is me being practical. Think about how every company has policies and procedures in place that seek to confirm everything is being done right. From how small companies check physical inventory against what’s in the computer system to how large companies engage in annual audits with external firms, this idea to “trust, but verify” is pivotal.

When it comes to engaging in this probing process with people you’re starting to work with, as with the situation with your vendor, it’s important to remember that it is not a personal battle of wills. Your job is not to be the smartest or toughest person in the room; it’s to make sure outcomes are great and as expected—or better. Therefore, this is a practice that requires communication and collaboration.

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Even when you have trust, it’s necessary to ask questions. Based on the answers you receive, you either gain more conviction, or determine that you need to investigate further. This isn’t something that happens ad hoc. Or worse, once things go off the rails. In order for your venture to be successful, there must be processes and checkpoints in place.

This is the process that I use:

1. Gain alignment around goals. Nothing can be done until everyone is aware of what is expected of them and what success looks like.

2. Practice clear and timely communication. Have regularly scheduled check-ins. (The frequency depends on the demands. Check-ins can be weekly, but sometimes this can be daily, or even more often.)

3. Establish a system for reporting problems. How long before someone flags a problem and asks for help? (You never want them to wait too long. As I am fond of saying, problems don’t get better with age.)

4. Check the outcomes against your goals to ensure that everything is staying on track, and hopefully, proceeding even better than expectations.

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Whether things are going well or less than well: Trust but verify. Hopefully this will just confirm what you already know, and if not, you’ll be a step closer to where you eventually need to go.

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