PEOPLE
PEOPLE
Nearly 60%of firms say themajority of SRM practitioners sit within procurement Fig. 30. Where are the majority of SRM practitioners placed in your organisation? (2017)
46%of organisations have defined the role of operational personnel supporting SRM Fig. 28. Have you defined the role of operational personnel supporting the main SRM role?
Supporting roles get recognition
SNAPSHOT ANALYSIS
In recognition of the involvement of the wider business in SRM, our 2018 study includes a question asking whether the roles of operational personnel supporting SRM had been defined. We found that almost half of all respondents have started to define these roles. The trend is much more prevalent among leaders, 86% of whom have defined the role of operational personnel supporting the main SRM role. From an organisational perspective, little has changed since 2017 when companies said the majority of SRM activity was led by the central procurement function (60%), while 16% say it sits within a decentralised procurement team and 17% say it sits within other decentralised functions.
If your main role is category management and sourcing, you know that is what you will be measured on. The discipline requires a good understanding of the market and business requirements and the ability to position those requirements in the market to attract the best possible deal. Internal stakeholder management is important but relationships with suppliers will mostly be conducted across a negotiating table and they can often be subsidiary to the main goals. But to gain long term and sustainable value from supplier relationships, vendors need to trust your business. They will only do so if they see SRM as an activity outside the merry-go-round of commercial competition. This is why we are concerned 54% of organisations combine SRM with category management and sourcing roles. For suppliers to buy into the SRM process, they need to see it as something different.
In the procurement function (central / group)
60%
46% Yes 44% No 10% Don’t know
In another function (decentralised / business unit)
17%
In the procurement function (decentralised / business unit)
16%
Dedicated SRM roles become more common
In another function (central / group)
7%
Both in our research and from engagements with clients we have observed an apparent mismatch between the resourcing and organisational design adopted by the sell side in relationships and the approach adopted by the buy side. While the sell side tend to create well-resourced and capable teams to manage key client relationships, often the supply side does not. For the most part, early SRM resourcing and organisational design was based on adding responsibility for relationship management to existing category managers’ roles and/ or the responsibilities of sourcing teams. Not surprisingly this model constantly underperformed because individuals in these roles faced competing priorities. From 2016, we started to see a trend towards creating dedicated SRM roles, although they would often cover a number of relationships. In 2018, half of organisations had a role dedicated to SRM, although only 9% have a role dedicated to managing a single relationship. Leaders in SRM are increasingly acknowledging the different competencies, skill-sets and behaviour required to manage strategic supplier relationships to their full potential. They see that how they deal with strategic suppliers is as important as their management of key customer accounts and they are prepared to invest in people and skills accordingly.
86%of leaders have defined the role for personnel supporting themain SRM role? Fig. 29. Have you defined the role of operational personnel supporting the main SRM role?
Leaders in SRM are increasingly acknowledging the different competencies, skill-sets and behaviour required to manage strategic supplier relationships to their full potential.
Leader
Fast follower
Follower
Yes
86%
68%
34%
54%of organisations still combine SRM with other procurement roles
No
14%
22%
Fig. 31. Which of the following would best describe the resourcing / organisational design model for SRM adopted by your organisation? (2017)
55%
Don’t know
0%
Part of a broader category management or sourcing role in procurement
10%
11%
54%
Full time dedicated supplier managers responsible for more than one relationship
41%
Part of a broader operations / service management role in the business
Almost half of all respondents have started to define the role of operational personnel supporting SRM.
29%
Full time dedicated supplier managers responsible for one relationship
9%
64
STATE OF FLUX
2018 GLOBAL SRM RESEARCH REPORT
65
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