Making an outsourcing relationship better: that’s above my pay grade

There seems to be a trend going on amongst outsourcing client types. It’s called the kick-the-can upward approach to fixing a flailing relationship. The game goes like this: client relationship manager and account manager agree that there are problems with the relationship. The client gripes, while his or her provider account executive expresses all the right sympathies, but is seemingly powerless to make a change. This goes on for months while dissatisfaction, particularly on the client side, spirals into a semi-crisis from a low groan. Then the decision is made to haul the provider’s CEO, or unit head, to the client’s office for a relationship summit. He or she says all the right things, and there’s a good chance that, if the pain is caused by personalities on the provider’s side, that they’ll be switched out. Or processes will be adjusted. Or maybe the provider will take on more scope as a relationship palliative, or stop pushing a myriad of change requests. But will the relationship fundamentally change? And how long will it be until said CEO or leader reprises his visit?

If this trend is indeed true, it bollixes me to think that grown up boys and girls at the account level can’t seem fix an ailing outsourcing relationship, and that the top brass have to pay obeisance to the client in order to start to get it back on track, sort of an “it’s above my pay grade” response to working together more effectively.

That’s not to say that the front line doesn’t try. Some account level management bring in consultants cum marriage counselors—or even industrial psychologists—to try to fix what is sometimes a real problem with performance, and more often than not a mismatch of expectations that is a holdover from a very aggressive sales process. Others bravely disclose their relationship problems to their sponsors in the governance process, potentially risking their reputations by coming clean that not everything is hunky-dory. But when all else fails, it’s easier to kick the issue upstairs.

Why are account teams unable to fix a relationship? There are seven reasons that those closest to the problem can’t move the dial:

• Unwillingness to communicate the full impact of the problem.  Sweeping a relationship issue under the rug in the hope that it will go away is far easier than admitting that account management is unable or incapable of a sustainable fix. Fear of retribution by management, or being classified as a problem account by the provider with all that entails personally for account management often paralyzes the team, and the situation spirals out of control.
• Blame placed on one partner. Unless both account leaders take the time to understand that any relationship is bilateral, and that both sides have issues, very little will change. Less experienced managers may not have the skills to see each others’ point of view.
• Focus on the wrong stakeholders, also known as the squeaky wheels. It is easy to blow relationship issues out of proportion when stakeholders with little skin in the game, but big voices, have a disproportionate voice. The challenge for the account teams? Not understanding the difference.
• Fact thrown out the window in deference to feeling. At times the perception that “it’s not working” obfuscates actual performance. Account teams become powerless to cut through to the root cause of relationship dissatisfaction.
• Issues made out to be overly complex. If the relationship challenge is too complicated, account teams tend to throw up their hands and walk away.
• Lack of training in relationship management The so-called ‘softer skills’ get short shrift when it comes to insuring that the front line masters the full spectrum of account management.
• Different tolerances for dissatisfaction Usually the client team sets the bar higher when it comes to relationship satisfaction, while the provider team has a higher tolerance for dissonance. As a result, client teams think that the provider is not listening, or committed, when the two sides don’t see problems in the same light.

So the bosses are called in. Listening intently, promising to change account leadership, and conceding a few points on the provider side is not a fix. Threats by the client sponsor do not move the relationship up a notch. What should sponsors do to make an outsourcing relationship sustainably better?

• Motivate all stakeholders to collectively and rapidly move the dial on performance and customer experience, both on a team and individual level, by agreeing the current state and its implications for relationship success
• Ensure that there is recognizable change in the tenor of the relationship…and quantify that change
• Ensure that  an uptick in the relationship is sustainable, with mechanisms in place to identify or resolve new challenges as they occur before they become problematic and affect the relationship