September 1, 2015
As companies continue to outsource many of their HR functions, it's important to know how to negotiate contracts with the right vendor. Keep the following in mind:
- Know your needs and goals.
- Institute a detailed RFP (request for proposal) process.
- Specify company/vendor responsibilities.
- Set detailed performance standards.
- Determine growth rates.
- Don't use a vendor's standard contract.
- Don't sign incomplete contracts.
- Don't set a reporting system for convenience.
- Don't neglect your employees.
- Don't ignore the vendor's motives.
SOURCE: Winning Strategies for Outsourcing Contracts, Personnel Journal (now Workforce), Jennifer J. Laabs and Brenda Paik Sunoo, March 1994.