Vendor Assessment

Definition

Vendor Assessment is a technique used to evaluate external suppliers or solution providers to determine their suitability based on business, technical, financial, and risk criteria. It provides a structured and defensible basis for build-vs-buy decisions, platform selection, and outsourcing initiatives — replacing intuition and informal preference with documented, criteria-driven evaluation.

Inputs

• Defined evaluation criteria agreed with stakeholders (functional, technical, financial, risk, support)
• Assigned weights reflecting relative importance of each criterion
• Vendor responses, demos, proposals, or RFP submissions
• Reference checks and independent market research

Outputs

• A vendor evaluation scorecard with scored and weighted results
• A recommended vendor or solution option with documented rationale
• Risk and dependency assessment for the preferred option
• Inputs to contract negotiation, implementation planning, and business case

When to Use

• Build-vs-buy decisions where external solutions are a viable option
• Tool, platform, or technology selection across multiple competing vendors
• Outsourcing initiatives requiring formal supplier evaluation
• Regulated or high-risk solutions where vendor stability and compliance must be documented

When Not to Use

• When a single vendor is the only viable option and assessment would be a formality
• When the decision has already been made for political or strategic reasons
• Very early exploration phases before requirements are defined enough to evaluate against