Out-Sourcing Contract Management
Contract Management from Maple Street
MCoUSA's Preferred Business Partner
for Contract & Vendor Management Services
To provide community bankers with the best possible experience, for several years MCoUSA has partnered with Maple Street (formally Tantoo Street) as our Preferred Vendor.
"We take very seriously the trust our clients and friends in community banking have placed in us over the years and, in turn, we very rarely make any endorsements. Maple Street is the only company that we are aware of that is currently providing a turn-key package for Contract and Vendor Management to community banks. We believe the Maple Street approach is unique and the pricing is modest and fair representing true value for Community Banks. We are pleased to recommend their Contract Management & Vendor Management Services. As with all Preferred Partner designations, MCoUSA retains its client relationship and is actively involved in ongoing relationship management."
James "Jim" Myers,
Founder/CHM/CEO
______________________________________________________________
First Commercial Bank of Florida
Orlando, FL
"One of our challenges was finding the time to make sure we always had complete copies and the most recent versions of our major contracts on file. By using Maple Street Services, that task is taken care of and our contracts are always up to date and immediately accessible."
- John Martin, SVP & CFO
Day-to-Day Contract Management is becoming increasingly more complex and many bankers have found it efficient and economical to outsource this function. A formal contract management program is a proven way to reduce fixed expenses. Statistics show that for every $1.00 of fixed cost reduction the bank increases its profit by $3.00. A contract Management Program is a process to understand exactly (and on what) the bank is spending and a review of what the bank gets in return.
With the Maple Street Solution:
All vendor contracts are located, organized and scanned into a secure system
Contracts are web accessible, available 24 X 7
Contracts are fully searchable
Prevents contracts from rolling over
Eases regulation compliance
Gramm-Leach-Bliley compliance assured
Invoice Review process provides pricing accuracy with contract
terms
A Structured approach to outsourcing
The Four Steps in Contract Management
There are four steps to an overall contract management and expense reduction program.
1. Assessment
2. Planning
3. Execution
4. Measure
Assessment
The first step is assessment. All Contracts need to be gathered, missing contracts need to be located and completed; and each needs to be analyzed in terms of the expenditures both by vendor and by type of product or service. A transactional analysis of major contracts to earn an understanding of the details of what the bank pays each vendor and what the bank gets in return is the key to completing an accurate assessment.
Planning
The second step is planning. Good planning brings better results. Planning includes the development of a vendor management, income enhancement, and expense reduction program that sets realistic targets to reduce expenses and get better vendor performance. The plan includes identified opportunities to consolidate business, where it makes sense, to get higher volumes resulting in lower prices. The plan includes an understanding of the linkage between products (e.g. debit card processing, ATM driving and EFT networks) that is important to maximize both income opportunities and expense reduction.
Execution
The third step in the process is execution. Any plan is worthless unless it’s executed well. The problem is that execution often requires a great deal of time and effort. The effort goes beyond price; it should also include thorough negotiation of contract terms and regulatory requirements, too.
The key to executing the plan is knowing how and when to use the elements of power in the negotiation process. Those elements include time, knowledge, and competitive pressure. Of these, competitive pressure is the most important, but that means developing requests for proposals, comparison of responses between vendors and an ability to fairly compare and benchmark expenses with what is competitive in the marketplace. That requires a great deal of time and effort.
Measure
The fourth step in the process is to measure the results of the execution of the plan. Done correctly, the measurement criteria will have been built as part of the execution of the plan. It’s then important to have the time and to make the effort to compare contracts with the expected results and the measurement criteria.