STATE OF FLUX
2014 GLOBAL SRM RESEARCH REPORT
ARTICLE 85
I T ’ S A B O U T the SUPP L I E R E X P E R I ENC E
© 2014 State of Flux
You will have noted that this year’s global SRM report is titled The Journey to Customer of Choice. This reflects what we see as a changing competitive dynamic in the traditional customer / supplier relationship.
ARTICLE BY Alan Day, Chairman and Founder of State of Flux. Call Alan on +44 (0)2078 420 600 or email him at alan.day@stateofflux.co.uk for more information on how to become a customer of choice.
Whereas traditionally suppliers have competed with each other to win business from customers, we are seeing increased evidence that customers are now required to compete to secure the services and long term support of critical suppliers. The concept of ‘customer of choice’ is now well established (and explored in more detail in our article ‘the journey to customer of choice’ on page 63 ). A vital factor in becoming a customer of choice and gaining the associated advantages is the supplier's experience in doing business with you. Though perhaps more difficult to quantify, the value of benefits that are not contractual obligations is clear – especially now that some
organisations are realising that category management and strategic sourcing are no longer delivering the financial benefits they used to. First refusal on innovations; access to, and retention of the best people; and prioritised supply during periods of shortage can have a great impact on an end service delivery and translate to financial benefits. Our research and other studies into customer of choice reveal that suppliers value three relationship attributes more than any others. But only one of these is likely to provide sustainable value.
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