The 20/60/20 Method: How to Evaluate and Feedback a Service Provider
Last update: 14 August 2023 at 05:23 pm
5.00/5As your project draws to a close (or maybe not even) and your relationship with a service provider may be coming to an end, there is an important task that both parties need to complete before parting ways: drafting up an evaluation and providing feedback.
Feedback is a valuable part of a successful collaboration, and while it is common for clients to provide feedback to service providers, it is equally important for service providers to do the same for you.
But how do you evaluate the work of a service provider? And how do you give them feedback? Here are some ideas and resources for you to use at the end of, or even during, any relationship with a service provider.
Understanding what to evaluate – The 20/60/20 Method
Before Getting Started
The key to a successful relationship between a business and a service provider is goal setting and effective communication.
It is essential to establish clear and agreed metrics from the outset in order to accurately assess performance.
By working together to agree on targets, the potential for misunderstandings can be minimised and a sense of mutual accountability can be created. Setting goals and objectives together provides a solid basis for evaluating the service provider’s performance and facilitates productive communication throughout the partnership.
The 20/60/20 Method for Evaluating a Service Provider
When evaluating a service provider, it is important to consider a variety of factors that contribute to the success of the relationship. While it is common to focus on hard measures such as revenue growth and customer acquisition, it is equally important to consider the influence of uncontrollable factors and the quality of the relationship between the both of you.
By striking a balance between these three categories of metrics – hard, medium (robust) and soft – it is possible to gain a comprehensive understanding of the service provider’s performance and identify areas for improvement.
Cue the 20/60/20 method. 👉
When designing the evaluation, it is important to avoid giving equal weight to each metric. This is because the service provider’s work has varying degrees of impact or various uncontrollable factors that can affect its results.
By assigning 20% weight to hard metrics, 60% weight to intermediate metrics, and 20% weight to soft metrics, you are prioritising the metric that reflects the service provider’s main efforts and contributions, and giving it the greatest weight in the evaluation.
This approach ensures that the evaluation accurately reflects the service provider’s performance based on the metrics that are most relevant to their role or responsibilities.
Hard Metrics (20%)
Hard metrics are quantifiable indicators that can provide valuable insight into a service provider’s performance within the larger context of the business.
Hard metrics include measurable factors that reflect the overall progress and performance of a business, such as:
- Overall return on investment (ROI)
- Sales volume
- Sales growth
- Market/brand share
- Cost efficiency
When evaluating a service provider, it is advisable to give hard metrics a weighting of no more than 20%. This allows for uncontrollable factors such as economic fluctuations, evolving markets, and other projects within the organisation that may not be directly under the control of the service provider being evaluated.
Medium (Robust) Metrics (60%):
On the flip side of hard metrics, medium metrics (or robust metrics) should form the backbone of the evaluation.
These metrics are specific to the project the service provider took on. They can be financial metrics, such as:
- Adherence to budget
- Effective cost management
- Return on investment (ROI) for specific campaigns against industry benchmarks
They can also be marketing metrics such as:
- PPC
- SERP rankings
- Effectiveness of campaigns
You can also assess how the service provider handled uncontrollable factors. As mentioned in the hard metrics, in an ever-changing business landscape, external factors such as economic fluctuations or unforeseen market shifts can have a significant impact on the project outcome. Instead of evaluating their work based on the fluctuations, evaluate how they handled the external shifts.
Soft Metrics (20%):
While hard and medium metrics focus on tangible results, it is equally important to consider the softer aspects of the partnership. Soft metrics relate to the quality of the relationship between you and the service provider.
Factors such as effective communication, responsiveness, transparency, and trust play a critical role in successful collaborations.
Evaluating the soft metrics helps to assess overall satisfaction, the experience of working together, and the long-term potential of the partnership. It provides an opportunity to reflect on the intangible elements that contribute to a productive working relationship.
How to evaluate soft, medium, and hard metrics
Once you have identified the aspects you want to evaluate, determining the specific criteria for measuring these evaluation points can be challenging. How do you assess value for money? Responsiveness?
For hard and medium metrics, the first step is always to benchmark. From there, you can use scorecards to calculate the overall results.
Hard and Medium Metrics – The Balanced Scorecard Method
The traditional Balanced Scorecard approach allows you to set strategic goals and monitor performance from four perspectives: Finance, Customers, Internal Processes, and Learning and Growth.
These four perspectives can operate independently, but they are also interconnected. For example, return on investment (ROI) depends on customer satisfaction, which is influenced by efficient internal processes. Efficient internal processes, in turn, depend on factors such as human capital, organisational capital, and information capital.
However, this Balanced Scorecard would look a little different for a specific project you would do with a service provider.
Let’s say you worked with a social media agency to create some social media campaigns for your company. Your Balanced Scorecard would look something like this:
How do we apply this method to evaluation?
When working with a service provider, it is important to consider the ‘before’ and ‘after’ perspectives. Before the relationship, your organisation has a set of existing results, and during or after the project with the service provider, you would expect to see new or different results that can be compared to the previous ones.
When developing the Balanced Scorecard methodology to evaluate the service provider’s work, you will need to fill in information about
- The vision you have of what you want the project to achieve
- The strategy the project will follow
- The target and current results in terms of learning and growth strategies, internal performance, financial strategies, and customer strategies.
Let’s continue to imagine your collaboration with a social media agency. Your balanced scorecard will look a little like this:
But remember that the Balanced Scorecard method is based on the fact that certain elements of an organisation work together and some elements may overlap, as in the example below:
Soft Metrics – Evaluating a service provider’s soft skills
Soft metrics often involve qualitative aspects rather than quantitative measures, which can make them more difficult to evaluate. However, to assess these metrics, include the following criteria and questions in a scorecard. Then rate each item on a scale of 1 to 5, where 1 is “not at all” and 5 is “exceeds expectations”.
- Communication skills
- The service provider effectively conveys information and ideas to clients, colleagues, and other stakeholders.
- The service provider communicates well in challenging or difficult situations.
- Teamwork and collaboration
- The service provider contributes effectively to the overall team goals and objectives.
- The service provider actively participates in team discussions and contributes constructive ideas.
- Adaptability and flexibility
- The service provider demonstrates good adaptability to changes in project requirements or unexpected challenges.
- The service provider handles unexpected or last-minute requests effectively.
- Problem-solving and decision-making
- The service provider identifies and analyzes problems to find effective solutions.
- The service provider consistently makes informed and timely decisions.
- Time management and organisation
- The service provider effectively prioritizes tasks and meets deadlines.
- The service provider handles multiple responsibilities without compromising the quality of work.
- Professionalism and ethics
- The service provider demonstrates professionalism and ethical behavior.
- The service provider maintains confidentiality and handles sensitive information effectively.
- Emotional intelligence
- The service provider handles stressful or high-pressure situations while maintaining composure.
20/60/20 Method Sheet For You to Use
Once you have defined all the metrics that you will use to evaluate your service provider, the idea would be to present them with a final score for their performance. But don’t worry, we have a free sheet for you to use.
Simply fill in the metrics, give a score for each one based on the pre-determined benchmark, and the sheet will then calculate a final score for you.
Create your own 20/60/20 evaluation sheet
Copy our free template and start filling in your objectives and metrics.
View the template!You can watch the video below on how to use it.
When and how to present the evaluation – Providing the feedback
Once you have gathered all the necessary information from your evaluation, it is time to give your feedback to the service provider.
When is the best time to give feedback to your supplier, and what is the best method for doing so?
End of Project
This is probably one of the most popular types of feedback and should always be included in any collaboration between a business and a service provider.
This type of feedback should include a complete evaluation of the collaboration. You should provide feedback on all metrics (hard, medium, and soft) and provide specific examples and evidence to support your assessment.
How to deliver
An effective way to give this feedback is to have a dedicated meeting shortly after the end of the project. Have all your evaluation metrics handy and ready to share in a document at the end of the meeting.
You will also want to allow time in the meeting not only for you and the service provider to present your feedback to each other, but also to talk and discuss various points that have been raised during the meeting.
Make sure you arrange a date for the feedback meeting well in advance.
Checkpoints
Throughout your collaboration, you may decide to provide feedback at various milestones or critical stages of the project.
These checkpoints are defined together and can be either initial targets, specific time intervals (e.g. monthly or quarterly), or when conflicts or challenges arise, etc.
By defining these checkpoints together, you can set clear moments to review progress, address concerns and provide feedback to ensure the project stays on track and aligned with desired outcomes.
From there, you can decide on the type of evaluation that best fits the type of feedback you need to provide. For example, a monthly checkpoint will only include an evaluation of the previous month and look at intermediate metrics, whereas a quarterly evaluation will need to look at a longer period of time and may look at the three different metrics together.
How to deliver
The manner in which the feedback is given will depend on the type of evaluation you have agreed to. For example, in a conflict situation, it is always best to give feedback verbally in a meeting and to resolve any issues as quickly as possible. However, feedback on your fortnightly meetings, for example, can be given in a shared Google doc and may not be as time-sensitive.
Set a date in advance for more general feedback meetings or for feedback documents to be completed.
In future checkpoints, be sure to acknowledge any improvements the service provider has made in the areas you identified in the previous feedback session.
Ad hoc
This type of feedback is given without prior notice or discussion between you and the provider.
As this type of feedback may seem ‘out of the blue’ to the provider, it is very important that you are clear about why you have decided to give this feedback, why now, and what you hope to gain from it.
Whether the feedback is positive or negative, make sure you have a thorough evaluation that justifies your spontaneous actions.
How to deliver
This kind of feedback should always be delivered orally via phone or in a meeting.
Feedback best practices to keep in mind
Provide concrete examples or evidence:
Support your feedback with concrete examples or evidence to make it more effective and actionable. Whenever possible, include screenshots, emails, or other relevant documentation to support your feedback.
Evaluate both pros and cons:
Aim for a balanced review, acknowledging both the provider’s strengths and weaknesses. Avoid giving only positive or negative feedback. Start with the positive aspects and then move on to areas for improvement.
Be constructive and solution-oriented:
If you are giving negative feedback, be constructive. Rather than simply criticising, offer suggestions or recommendations on how the service provider can improve their service. This will create a more cooperative and productive environment.
Focus on facts and observations:
Make sure your feedback is based on facts and objective observations rather than personal opinions. Describe the specific situations, actions, or behaviours that have influenced your assessment, providing a clear and objective basis for your feedback.
Use appropriate channels:
Use the service provider’s preferred channels for feedback. They may already have systems in place. If not, find out their preferred method for receiving feedback. Direct your feedback to the appropriate person or department to ensure it reaches the right people.
Follow up if necessary:
If you do not receive a response to your feedback, consider sending a gentle reminder to the service provider. Following up shows your commitment to resolving any issues and encourages effective communication and resolution.
Conclusion
In conclusion, as your project with a service provider comes to an end, effective evaluation and feedback is essential. Remember the importance of goal setting and clear communication from the outset to build a strong foundation for collaboration.
The 20/60/20 Method provides a comprehensive approach to assessing performance by dividing metrics into hard, medium, and soft measures. Applying to it the Balanced Scorecard methodology provides a structured approach to evaluation, highlighting the combination of financial, customer, and internal processes, as well as learning and growth perspectives.
Feedback, whether at the end of a project, at pre-determined checkpoints, or spontaneously, should be based on facts, provide a balanced view and suggest solutions. Remember to provide concrete examples to reinforce feedback and facilitate actionable insights and a collaborative environment.
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