Overview

  Understand suppliers' motivation - Use other levers to get the best from suppliers

Suppliers are normally motivated by maximising their profits on contracts but they are also motivated by other factors. The high-profile failure of public service delivery can affect a supplier's reputation. For example, it can affect their ability to win future work both with government and elsewhere, and significantly affect their share price. However, government contracts can also offer suppliers public recognition and prestige, alongside opportunities to fulfil wider values and objectives. Our work with suppliers has shown how important reputation is to them and how some manage this at least as strongly as formal performance management mechanisms against contractual incentives.