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Often the agency roster is defined by marketers and advertisers as the advertising agencies they work with on a daily basis. But from a financial and procurement perspective all suppliers paid from the marketing cost centre are part of the marketing supplier roster. Following on from the work done by TrinityP3 in 2011 this presentation takes the concept of a tiered roster approach further into the management and maintenance of the roster to ensure maximum performance and minimum waste.
Previous presentation on this topic can be found here https://www.slideshare.net/darrenwoolley/trinityp3-strategic-supplier-alignment-process
2. marketing management consultants
What is a marketing supplier roster?
All suppliers (or agencies) paid from the
marketing budget to provide products /
services required for the implementation
of the marketing strategy.
This is more than just the agencies
where you may invest the majority of
your time and budget.
Increasingly it may also include in-
house services such as production,
media, social media etc.
Brand
3. marketing management consultants
How do you structure your roster?
Often rosters are segmented into two
groups: Those you work with regularly
and the rest.
This is why many believe their roster is
only perhaps no more than ten
agencies.
When in fact the financial ledger will
reveal hundreds or even thousands of
suppliers and vendors being paid from
the marketing budget.
Brand
4. marketing management consultants
So how should you segment your roster?
There are several ways to segment
your supplier roster including:
• Buckets of services or capabilities
(Based on the services provided)
• Spend profiles
(Based on annual spend intervals)
• Strategic importance
(Based on role and strategic value)
$?
Capabilities?
Strategic
Importance?
5. marketing management consultants
Why should you structure your roster?
Having an unstructured roster leads to:
• It growing organically based on
immediate need rather than strategic
need.
• Duplication and waste with multiple
suppliers providing the same
services.
• Fragmented marketing spend
decreasing purchasing power.
• Increased time required to manage
each agency and supplier.
VS
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What is the recommended roster framework?
While all and any model can provide
advantages our experience shows the
strategic alignment works best by:
• Categorising suppliers by their
strategic role and importance.
• Applying a category management
framework to each category
including selection, remuneration
etc.
• Eliminating duplication and
maximise supplier utilisation.
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7. marketing management consultants
The strategic alignment framework
Not all suppliers are created strategically
equal. Think of it in three levels or tiers:
• Strategic Partners – suppliers that
influence the development of
marketing or communication
strategy.
• Specialist Service Providers –
specialists essential for strategy in
their particular field.
• General Service Providers –
suppliers of often commodity
services.
Tier 1:
Strategic
Partners
Tier 2:
Specialist Service
Providers
Tier 3:
General Service Providers
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Rank (up to) top 10
current suppliers by
spend
Populating the framework
There are a number of considerations
when populating the strategic
framework from an existing roster.
Depending on the size of the existing
roster and the strategic needs of
marketing these may be weighted.
The purpose of this approach is to
ensure no supplier is overlooked while
reducing the roster to the most efficient.
Is the suppliers
services strategic,
specialist or generalist
Is the supplier engaged
elsewhere in the roster
or the organisation?
Should any supplier be
given special
consideration?
What is the suppliers
potential future
contribution or
importance?
Rank current suppliers
by delivery/
performance record
Is there capacity or
capability to expand
current role?
Are there too many
suppliers in any one
tier?
9. marketing management consultants
Selecting new agencies
When adding to the roster framework it
is important to:
• Look to see if the gap can be filled
by another existing supplier rather
than adding additional suppliers.
• Only replace a Tier 1 or 2 supplier
when requirements change or
performance management fails.
• Ensure the selection process is
specifically designed to deliver the
‘best fit’ to the roster. e.g. Tier 1 is
strategically capable and best fit with
the other suppliers in that tier.
?
?
10. marketing management consultants
Supplier remuneration
Remuneration should ideally encourage
and reward performance depending on
the tier.
• Tier 1 should be based on sharing in
the result of their collective strategic
contributions.
• Tier 2 should be based on
exceeding expectations in delivering
innovation in their specialist field.
• Tier 3 should be based on driving
continuous cost and time efficiencies
in delivery of their services.
Outcome$
Output$
Cost$
11. marketing management consultants
Supplier contracts
While terms and conditions may be
consistent there is a need to customises
supplier contracts across the roster.
• Define not just the services provided
but the supplier’s role and
responsibility within the roster.
• Differences in remuneration models
must be clearly articulated for each
supplier tier.
• Performance KPIs will vary and
need to be specified for each tier.
• Need annual contract reviews to
maintain relevance.
Tier 3 Contract
Tier 2 Contract
Tier 1 Contract
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Performance Management
Supplier and roster performance is
evaluated at multiple levels
• Tier 1 – Marketing & Business
Performance
• Tier 2 – Capability Delivery
Performance
• Tier 3 – Operational Efficiency
Performance
• All Tiers - Relevance, Capability,
Collaboration, Contribution
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Reviewing the Roster
Regularly (depending on dynamics)
review roster for:
• Changes in strategy
• Changes in requirements
• Changes in budget
• Supplier performance
• Category performance
• Changes in scope of work
• Consolidation opportunities
?
X X
X
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14. marketing management consultants
Roster Management Checklist
1. Define strategic marketing
requirements of the roster
2. Decide on a roster framework
to suit requirements
3. Categories suppliers to the
chosen framework
4. Replace or select new suppliers
specific to the category
5. Align remuneration to supplier
category to reinforce performance
6. Ensure contract supports supplier
category
7. Manage supplier performance to
the specific category
8. Review roster composition and
performance regularly
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For more information please contact us
TrinityP3
New York
+ 1 (646) 666-7142
Sydney
+61 (2) 9964 9900
Singapore
+65 6631 2861
London
+44 (203) 790 9229
people@trinityp3.com
www.trinityp3.com
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@TrinityP3
TrinityP3
TrinityP3.StrategicMarketingConsultants