7 vital SaaS vendor management skills
you can’t ignore

Vendor management is more than just handling contracts and suppliers—it’s an intricate balancing act of skills that you can’t simply pick up from a textbook.

Across different roles—whether in IT, procurement, operations, finance, or even HR—many professionals find themselves taking on the role of a SaaS vendor manager. 

To truly excel, it’s about more than just managing logistics. It requires building strong, mutually beneficial relationships, mastering vendor risk, and finding cost savings without compromising on quality. 

The key to success? Continuous learning and adapting to the ever-evolving landscape. Let’s look at what challenges might come your way and what you can do to master the role.

Challenges of handling SaaS vendors

Managing SaaS vendors is a demanding role that requires a sharp blend of skills, strategic insight, and attention to detail. Let’s break down some common challenges you might face:

• Negotiation stalemates. What would you do if a vendor pushed back on contract terms, creating a standoff? You’re stuck between protecting your company’s interests and finding a compromise. This isn’t just about negotiation; it’s about understanding their position and crafting win-win solutions.
• Contract management complexities. Imagine juggling a contract that’s been amended multiple times in a year. Contracts can quickly become unwieldy, with different versions causing confusion. Staying on top of the latest terms is crucial to avoid legal issues.
• Regulatory compliance issues. What if your vendor fails to meet key regulatory requirements? Suddenly, your company is at risk. This is why constant vigilance and a robust vendor management process are essential, ensuring compliance through regular checks and clear communication.
• Technical misunderstandings. Ever found yourself in a situation where technical jargon leads to miscommunication with a vendor? This can derail projects and cause costly delays. A solid grasp of technical concepts—or access to experts—is crucial to avoid these pitfalls.
• Financial stability concerns. You’ve secured a great deal, but later discover the vendor’s financial health is shaky. This can disrupt your entire operation if the vendor falters. Thorough financial due diligence during selection and ongoing monitoring is key to mitigating this risk.
• Strategic alignment dilemmas. Short-term wins sometimes clash with long-term goals. Ensuring vendor activities align with your company’s evolving strategy requires foresight and a strategic mindset.
• Legal pitfalls. A minor oversight in contract language could expose your company to significant risks. Having a strong legal foundation or access to legal expertise is essential to safeguard your interests.

Now that we’ve dissected the challenges, it’s clear that SaaS vendor management is a complex, multifaceted role. 

But with the right skills and strategies, these challenges can be effectively managed. Let’s explore how you can develop these essential skills.

Core vendor management skills

Developing essential vendor management skills is crucial, and there are top-notch resources available to help you sharpen these abilities. Here’s a breakdown of the key skills you need and the best resources to master them:

1. Negotiation mastery

Negotiating favorable contracts is crucial for successful vendor management. Strong negotiation skills can lead to cost savings and robust supplier partnerships. Learn from:

• Never Split the Difference by Chris Voss: Learn negotiation strategies from a former FBI hostage negotiator that turn deals into win-win situations.
• Successful Negotiation: Essential Strategies and Skills by George Siedel: A practical Coursera course offering techniques for effective negotiation in vendor management.
• Harvard Business Review’s Negotiate Like a Pro by Scott Walker: Learn the level-five mindset with eight powerful negotiation tools.

2. Contract management

Contracts are the backbone of vendor relationships, ensuring adherence to terms and reducing disputes. Learn from:

• Practical Contract Management by Carter Ray: Packed with examples of good and bad practices, this book covers both the technical and relational aspects of contract management.
• Contract Management by Alain Brunet, Franck César, Becky Rawlings: Explores behavioral economics and digital tools in contract management, providing modern insights into effective practices.

3. Risk management

Managing vendor risk, from financial instability to regulatory non-compliance, is crucial for protecting your organization. Learn from:

• The Risk Management Handbook by David Hillson: Offers a thorough approach to managing risk, blending theory with practical applications.
• Risk Management for Corporate Leaders by HBR: A virtual course that equips leaders with tools and frameworks to manage risks effectively.

4. Relationship management

Building and maintaining strong vendor relationships leads to better collaboration and more favorable terms. Learn from:

• The Trusted Advisor by David H. Maister: This book dives deep into the importance of trust in business relationships, offering actionable advice on cultivating trust with vendors.

5. Financial acumen

A strong grasp of financial principles is essential for negotiating contracts, assessing vendor stability, and contributing to cost-saving goals. Learn from:

• Discount marketplace by Spendbase. This resource will help you learn what discounts you can potentially get from different SaaS vendors.
• Top 10 Vendor Management Systems by Spendbase. This article lists the software tools that you can use to analyze and optimize expenses on corporate software.

6. Strategic thinking

Aligning vendor activities with business goals ensures that every relationship supports long-term success. Learn from:

• The Art of Strategy by Avinash K. Dixit and Barry J. Nalebuff: Applies game theory to strategic thinking, providing tools for better decision-making in business.
• Good Strategy/Bad Strategy by Richard P. Rumelt: Distinguishes effective strategies from flawed ones, guiding leaders to create actionable plans for success.
• Playing to Win by A.G. Lafley and Roger L. Martin: A practical guide to strategic thinking, helping leaders make tough choices for competitive advantage.

7. Legal acumen

Understanding the legal aspects of contracts, compliance, and intellectual property is vital to avoid legal pitfalls. Learn from:

• The Legal Environment of Business by Nancy Kubasek, Bartley Brennan, M. Browne: A comprehensive textbook on business law, covering contract law and compliance issues.

By tapping into these resources, you can hone the critical skills needed to excel in SaaS management, ensuring your vendor relationships are both productive and profitable.

Developing vendor management skills

Mastering vendor management is not a one-time task—it’s an ongoing journey that demands dedication to learning and growth. To truly excel, you need to focus on three key areas:

Research resources, trainings, and thought leaders

Start by diving deep into specialized courses, certifications, and industry insights. But don’t just stop at learning—actively engage with thought leaders, whether through articles, social media, or industry events. This keeps you at the cutting edge of trends and best practices.

Learn from peers and mentors in communities

Surround yourself with others who share your challenges and goals. Join professional organizations, attend networking events, and seek out mentors who can provide guidance born from experience. The wisdom you gain from real-world situations can’t be found in textbooks.

For example, you can join the IT Leaders Lounge community to network with IT Directors, CIOs, and CISOs from around the world.

Follow best practices and watch trends

Stay vigilant about industry shifts. Continuously monitor the latest tools and methodologies, adopting those that enhance your approach. Benchmark your processes against industry standards, refining your strategies to stay competitive.

By committing to these practices, you’ll build the expertise needed to manage vendors effectively, positioning yourself as a leader who can navigate the complexities of this critical role with confidence.

Who excels in SaaS vendor management

Mastering SaaS vendor management demands a unique set of skills that are often refined through years of practical experience. For someone juggling numerous responsibilities, it can be challenging to dedicate the time needed to become proficient in vendor management.

At Spendbase, we’ve assembled a team of experts who focus exclusively on managing vendor relationships. With a deep understanding of what works and what doesn’t, our specialists ensure the best outcomes without the need for trial and error on your part. 

Let us handle your vendor management so you can concentrate on growing your business. We’ll take care of negotiations and provide you with a SaaS subscription management tool to help you manage your SaaS portfolio efficiently.