With some service providers, it’s easy to measure success. They perform a one-time job and collect an agreed-upon fee when the problem is solved, or the project is complete. But for third-party vendors that provide an ongoing service, it can be more difficult to measure success.
Staff members get busy. They have important tasks to finish. They forget to monitor benchmarks and key performance indicators (KPIs)—if any were established in the first place. “Good enough” becomes not just acceptable but the standard. And the service continues virtually unchecked.
However, evaluating vendor performance on an ongoing basis is essential for your institution. Monitoring and measuring success frequently can lead to many valuable benefits, including:
Improvements in services received — It’s the classic case of the squeaky wheel getting the grease. Checking in with your vendors keeps them accountable and on their toes.
Higher account holder satisfaction — A vendor delivering on its promise successfully helps in delivering an effortless experience to your account holders.
Discovering problematic areas that previously went unnoticed — Catching red flags early gives you time to course-correct while the issue is relatively small.
Reduced expenses — Contract fees and terms can inch up over time without an attentive eye keeping watch and willingness to enter renegotiations.
More opportunities — Exploring other vendors and their offers could lead to better products and services for your institution and your account holders.
Contingency-Based Fees Help Measure Success
When it comes to choosing vendors and getting measurable results, there’s no clearer way to measure success and make sure you’re getting the best deal than to work with companies with contingency fees based on performance.
Similar to real estate agents whose fees are based on how much they sell your home for, vendors who offer contingency fees are confident in their abilities and willing to demonstrate their vested interest in your continued success. It’s like getting built-in insurance that you’ll see results before you’ll see a bill. Plus, rather than just a service provider, you gain a trusted partner that’s working hard to provide the best service and results—because their success is tied directly to yours.
Companies with contingency-based pricing also typically have performance metrics and KPIs established, since that’s how they determine their pricing. This makes it incredibly easy for both parties to spot successes, as well as set new goals to aim for. It also means that, rather than you chasing after another vendor, they will be taking the lead to provide a summary of their results once a project is completed or a contract is up for renewal.
Walking the Walk
At the end of the day, vendor results matter. And if your current vendor can’t provide you with the measurable results in the areas that matter the most, it may be time to find one that can. And as you search, keep in mind the measurable benefits that are inherent in performance-based pricing.
JMFA is one of the most trusted names in the industry. Whether it’s recovering lost revenue, uncovering new savings with vendor contract negotiations, creating more value, serving account holders better or delivering a 100% compliant overdraft service—JMFA can help you deliver measurable results with proven solutions. To learn more, please contact your local representative or call us at (800) 809-2307.