CONCLUSIONS & CALL TO ACTION
STATE OF FLUX
2014 GLOBAL SRM RESEARCH REPORT
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6. Ensure the SRM role is properly defined and is one that will attract the best talent. Invest in training to equip your people with the requisite behavioural and technical skills to manage all aspects of the supplier relationship. 7. Information is at the heart of relationship management. Become ‘masters’ of it and enable real collaboration by using technology. Connect the enterprise inside and out, with scalable, secure and accessible supplier management technology that is integrated. 8. Take a proactive approach to relationship development by sharing information to promote openness, transparency and trust. Look inside your key relationships for strategic and cultural alignment using a 360° assessment. 9. Take steps to develop a supplier innovation
Our call to action for companies seeking to implement SRM or improve existing capability is to create a 12 month plan that will work across these ten essentials: 1. Understand where you are now, and how your SRM objectives and value proposition aligns to your company strategy and business drivers. Use this insight to shape and develop your SRM programme to deliver what the business needs. 2. Close the business drivers-to-benefits gap. Create strategies that focus on the most important business drivers, and develop a collaborative approach with suppliers. 3. Engage proactively with all key stakeholder groups in a two-way dialogue, especially senior stakeholders. For internal stakeholders, this involves not only ‘selling’ the SRM value proposition but also listening to their needs as customers of third party products and services. 4. Listen to suppliers. This means gathering data using a voice of the supplier survey to understand how they perceive you as a customer. 5. Ensure your approach to segmentation focuses your scarce resource on supplier relationships that will make the most difference and build robust governance at each segmentation level.
strategy and process, using guided innovation to target and accelerate collaborative innovation. 10. Leverage sell side strategic account
management (SAM). Look for the synergies in both parties seeking to create value, assure and deliver mutual benefits. Work with your key suppliers to produce a joint account plan.
FINALLY, A MESSAGE TO PROCUREMENT LEADERS Around 70% of SRM programmes are the responsibility of the procurement function. The SRM role is most commonly part of a broader role combined with category
real ownership of SRM. Too many organisations still have very little substance in their people, process and technology thinking post-contract implementation. We don’t understand why in the procurement industry we have defined such a detailed approach to sourcing, which takes possibly three to five months, and yet have done so little to define what should happen post deal. Especially considering the contract and the supplier relationship will be managed for between three to five years. Procurement are masters at identifying and capturing benefits, but as you can see from this report we need to do more about delivering and sustaining them. As procurement leaders, let’s take the case for managing contracts, performance and supplier relationships more effectively, to the business and our teams.
management or sourcing. In most cases, procurement develops and owns the SRM process. So as a procurement leader are you a champion and leader of SRM in your business? Are you a real advocate and taking the lead in SRM? Are you displaying the right behaviours towards suppliers which your team can emulate? Take the initiative and become the champion for SRM. We have been conducting SRM research for six years and working with companies on their SRM programmes for over ten. We want to see the procurement industry continue their journey to becoming a truly strategic function, by taking
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