When negotiating a contract with a third party, it’s important to include Key Performance Indicators (KPIs) to better enable tracking performance and ensuring your company receives the benefits of the third party relationship. KPIs should be concrete, measureable milestones that can be monitored and measured over the life of the agreement. They may trigger payment, or approval to move on to the next phase of the contract.
As part of ongoing third party management, with Hiperos 3PM’s Performance Management functionality, you can view and monitor the agreed-upon KPIs and measure the success of attaining them. 3PM’s flexibility enables ratings to be configured to meet the needs of the company and the specific contract. The third party can self-assess their performance of the KPI and that is then measured against internal stakeholders’ review of the third party’s performance. Automating the process and having a single source of information for third party relationships provides an on-going record of third party performance and also enables accounts payable to trigger payments based on successful performance and meeting or exceeding the agreed upon KPIs.