Betfair is promoting a collaborative approach to IT suppliers with the first annual awards programme to recognise preferred partners.

The online gaming firm has categories for the best hardware, software and green providers of the year, with an extra prize for overall winner.

And suppliers are taking the scheme sufficiently seriously for Sun Microsystems chief executive Scott McNealy to pick up his firm’s two awards ­ for green supplier and overall winner ­ in person last week.

Good supplier relationships are central to Betfair’s success, said chief technology officer Rorie Devine.

“It is a win/win cycle, helping both us and the suppliers to grow our businesses,” he said.

The changing nature of the relationship between users and their technology service providers will lead to a two-tier industry, said Devine.

“Really smart suppliers will adopt the partnering approach and work as a team with their customers, while the others will continue to just turn up when they win an order and then go away,” he said.

According to analyst Gartner, a successful procurement strategy must focus on the relationship with suppliers, not just the contract terms and conditions and the costs involved.

Suppliers offering a flexible approach which prioritises the overall outcome of a partnership rather than legal details add significant extra value to a customer’s business, said Charles Ward, chief operating officer of IT trade association Intellect.

“An outcome-based relationship, where both parties judge the value of the contract by its impact on the business, is more productive,” said Ward.

The emergence of positive relationships between customer and supplier reflects the growing maturity of the IT industry.

“The key to better supplier relationships is confidence in the industry which will come only by improving its image and professionalism,” said Ward.

Performance incentives, positive testimonials and business referrals are other ways of recognising supplier relationships, he said.

“If a customer recognises outstanding employees for their contribution, then why not extend that to the supply chain. They too are stakeholders in the success of a business,” said Ward.

The winners of Betfair awards for 2007 were Network Appliance for hardware, Fortify for software and Sun for green and overall performance.

Betfair is not alone in focusing on supplier management. HSBC also has an IT supplier relationship management scheme under its environmental efficiency programme.