PEOPLE
PEOPLE
Responses indicating no supplier management training has been provided in the past 12 months (all companies)
Key activities undertaken to develop supplier management skills
SUMMARY
(Total respondents)
Defined the main supplier management roles
Whilst all six pillars of supplier management are important, People is the pillar upon which the others truly depend. Organisations seeking to build strong and robust supplier management programmes should be careful to assign the right people to strategic supplier management roles; that is, people with the right combination of traits and competencies. Equally, they should be investing in identifying competency gaps and providing adequate training opportunities to address them. In 2021, investment in people and skills development remains under-represented. There are, however, some signs of improvement; a key one being an increase in the number of respondents whose organisations have defined the main supplier management roles (from 55% in 2020 to 62% in 2021). Defining relevant roles is a prerequisite for organisations determining what skills and competencies they require, so while the increase suggests progress, this year only one in three (32%) have taken the next step to review what skills are needed and even fewer – just 22% – have gone on to carry out a capability assessment. Due to this disconnect, as with previous years, respondents report significant inconsistency between the skills requiring improvement, and those for which they have received training over the past year.
13% Leader 26% Fast Follower 51% Follower
62%
Defined the supplier management roles of operational personnel that interact with suppliers in a supplier management capacity
45%
Created or updated job descriptions
39%
Included supplier management in personal performance targets and measures
38%
Developed supplier management skills and competency framework
responses were strategic thinking (49%) and identifying non-traditional areas of value (other than savings) (40%). These featured in the top two spots for Leaders, Fast Followers and Followers alike. Overall, across both important skills and identified skills gaps, little has changed in the five years between the two reports, representing clear agreement on what is needed regardless of an organisation’s level of maturity in the field of supplier management.
in respondents developing a supplier management skills and competency framework. For Leaders this rose from 60% in 2020 to 81% this year, while for Fast Followers it climbed from 35% to 46% in the same period. Secondly, we see a clear increase in the number of respondents completing a supplier management skills and competency assessment. Among Leaders, this jumped from 51% (2019) and 41% (2020) in previous iterations of the report to 57% this year. There was a similar surge in the Fast Followers group, shifting from 18% in 2020 to 31% in 2021.
32%
Completed a supplier management skills and competency assessment
22%
Supplier management team structure
Development of supplier management skills
None of these
20%
Where supplier management practitioners sit within organisations, is an area that has seen minimal change since the question was last asked in 2016. Just over half of practitioners (53%) are based in a central/group procurement function. One particular change worth noting however, is that among Leaders there has been a reduction in this area (from 70% in 2016 to 52% in 2021). In the Leaders cohort a percentage of supplier management roles now appear to sit within another central/group function (increasing from 0% in 2016 to 16% in 2021). Both Leaders and Fast Followers favour using full-time dedicated supplier managers responsible for more than one supplier relationship (69% of Leaders; 43% of Fast Followers). This approach has not yet been replicated by Followers (sitting at 27%). The most popular response among this group is that the role is undertaken part time in conjunction with broader category management/sourcing activities (36%).
81 %
Across the board, albeit at different levels across Leaders, Fast Followers and Followers, the two main activities undertaken to develop supplier management skills have been to define both the main supplier management roles (62%) and those supplier management roles/elements for operational personnel (by 45% of respondents – see graphic). Furthermore, among Leaders and Fast Followers, work was also undertaken to update job descriptions (76% and 50% respectively) and include supplier management in personal performance targets (75% and 52% respectively). Across all these activities, the results seen this year are largely in-line with what we have seen in previous years when we have asked this question. Compared to last year, there are two interesting, positive deviations in responses. Firstly, among Leaders and Fast Followers, we see an increase
OFLEADERSDEVELOPEDA SUPPLIERMANAGEMENT SKILLSANDCOMPETENCY FRAMEWORK
Training provision
When we review what training was actually provided in the past year, we note a stark mismatch between what organisations identify as important or necessary and what training was given. Our table illustrates this visually. It includes the various skills ranked by what was included in training over the past 12 months (total respondents). We would expect those at the top of the ‘training in the past 12 months’ column to be coloured green in one/ both previous columns to suit what was required, but for the most part there was a divergence. There are a number of clear exceptions to the expected order. Firstly, some elements such as negotiation skills, leadership and project management
58 %
Supplier management skills and identified gaps
There was strong consensus across all respondent maturity levels regarding the most important skills for supplier management: communication (58%) and commercial and contractual expertise (50%). Indeed, all three shared the same top six skills required, albeit in a different order. This was also the case when we compare the results to those from 2017 – the same top six skills identified then echo this year’s results. There was also agreement on which supplier management skills are most in need of improvement. The top two
OFRESPONDENTSRANK COMMUNICATIONASTHE MOST IMPORTANTSUPPLIER MANAGEMENTSKILL–THE TOPRANKEDRESPONSE ACROSSALLLEVELSOF MATURITY
51 %
OFFOLLOWERSDIDNOT PROVIDEANYSUPPLIER MANAGEMENTTRAININGOVER THEPAST12MONTHS
6 5
6 4
STATE OF FLUX
2021 GLOBAL SRM RESEARCH REPORT
Powered by FlippingBook