COLLABORATION
SRMHASAPOSITIVE EFFECTONNEGOTIATIONS
47%of organisations saySRMhasmade negotiationdiscussions moreconstructive,with 42%saying that suppliers bringmore to the table attribute that is improving most rapidly, with information sharing in second place. Both of these characteristics are leading indicators of relationships that will deliver more value. Although half of businesses say collaboration is improving, only 20% say innovation is getting better. This is unsurprising because only 8% of firms have seen an improvement in mutuality, a building block of innovation (Fig 35) . Businesses that want to accelerate innovation need to think about mutuality and incentivisation. RELATIONSHIPDEVELOPMENT Collaboration is the relationship CUSTOMEROFCHOICE Buy-side organisations that have a well- developed SRM approach are more likely to become a customer of choice to their suppliers. We have researched what customers think suppliers are looking for in an ideal relationship and also what suppliers are really looking for. The results are interesting. Customers believe the most important attributes that suppliers are looking for are: 1. Long-term relationships 2. Openness and transparency 3. Revenue and profitability Our dialogue with supply side organisations reveal that they are prioritising: 1. Openness and transparency 2. Good communication 3. Fair and equitable treatment While it is not an exact match, it is clear that companies are developing an increased understanding of the supplier perspective.
Fig 34. In what way, if any, has SRM changed the nature of negotiations with your key suppliers?
%
47
Discussions are more constructive
42
Supplier is bringing more added value to the table Both parties are taking a longer term and more strategic perspective Process and behaviours are less adversarial
40
38
33
Better outcomes for both parties
23
Quicker to reach agreement
15
No change
8
Less involvement from legal
3
Other
14
Don’t know
COLLABORATIONANDSHARING OBJECTIVESSHOWIMPROVEMENT
Fig 35. Which of the following aspects of the relationship with suppliers have noticeably improved in the past 12 months?
%
55
Collaboration
47
Sharing information
35
Continuous improvement and innovation
34
Joint planning
33
Supplier executive engagement
32
Mutual trust
29
Internal executive engagement
27
Reduced disputes and escalations
26
Compliance with contract SLAs /KPIs etc.
23
Effective and efficient governance
20 20
Supply chain risk
Post-contract value delivered
10
CSR/sustainability engagement
8
Mutuality
12
Other
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