SPEED
SPEED
the business will respond and ensure those suppliers can deliver some value.
Get a group of suppliers and stakeholders together that are
representative of the business, where any benefits will be widely recognised. Plough fertile ground where there’s an opportunity to explore or a business challenge to overcome. While procurement will want the SRM programme to work for all tiers, the business will be focused on the top 1-10% of suppliers who can help them delight their own customers. Start small and prove your case. Once suppliers and relevant stakeholders are onboard, we use an approach that tackles relationship challenges and the quest for increased value in parallel. Leveraging senior executive sponsorship, both parties are rapidly engaged in a 360-degree relationship review and a Value Release ideation process. The two activities are inextricably linked. The 360 review will reveal strengths and weaknesses in the relationship that will potentially help or hinder the creation and delivery of value. Companies report that the very process of examining their relationship generates value because it starts to lay the foundations of increased trust and openness that are necessary to improve. We then start a facilitated engagement with stakeholders and subject matter experts known as Value Release. This is a high-tempo approach that rapidly validates and prioritises ideas to put to senior stakeholders at a joint workshop. It culminates with a Joint Account Plan consisting of initiatives to both improve the relationship and deliver key value opportunities. While SRM is a business-wide change programme, our experience with many clients is that this can be perceived as too big a challenge because it’s often happening alongside other transformation programmes. The Value Accelerator limits the initial engagement to fewer stakeholders, proves the concept, and sets up the longer term change programme for success.
Accelerate your transformation
Feature
Changing the culture of any business takes time, to pick up the pace start small and use technology to support you on the journey. T here were already a myriad of reasons why businesses should invest time and effort into managing their suppliers – value,
Never waste a good crisis: Procurement has a place at the table now and it can use that position to drive the change that needs to happen. State of Flux 2020
And it is possible to capitalise on this in so many ways. For procurement’s part, the spotlight on supply chains, risk and resilience means the time is now to make long-awaited change a reality. Never waste a good crisis, is essentially the advice. Procurement often bemoans the lack of a place at the decision- making table, well it has one now. The time for jumping through hoops is gone. It is imperative organisations have supplier management in place and that they don’t view it as a procurement initiative, but a business initiative led by procurement. The challenge is to demonstrate success quickly. Businesses are typically hungry for results but when it comes to change, some things are easier than others to do quickly. Cultural change takes time, yet any procrastination or delay means lost momentum. Here we explore how you can overcome these obstacles by injecting pace in to the development and implementation of improved capability via process, technology and people – and start seeing results at your company in a matter of weeks.
innovation, growth and continuity among them. Then, 2020 handed us the clearest evidence yet that without strong supplier relationships and risk management in place, organisations face potential collapse. Covid-19 is not a ‘typical’ business continuity risk, it has characteristics that make it far more serious. It was sudden and escalated quickly, has had universal impact and a far-reaching effect on national and global infrastructure. As Lenin said: “There are decades where nothing happens; and there are weeks where decades happen.” The outbreak and rapid spread of the pandemic highlighted weaknesses in readiness and planning, with only 7% of organisations having considered such a risk. On the positive side, it has forced businesses and individuals to quickly adapt to new ways of working, with increased virtual interactions and the need for more automated processes.
8 WEEKSTOCOMPLETE A ‘VOICEOFTHE SUPPLIER’ SURVEY CANBEDONE 12 16 WEEKSFORASRM PROGRAMMETOBESETUP 6 8 WEEKSFORCLOUD BASED TECHNOLOGYTOBE IMPLEMENTED
programme that goes beyond only procurement and incorporates all parts of the business that interact with suppliers. The selection of those first few suppliers is key. Pick those with a strong performance record to avoid conversations around value getting derailed by concerns over performance. Next challenge: If you pick partners you’ve been working with closely for some time you may struggle to generate fresh ideas; while suppliers with whom you’re very unfamiliar may take longer to bring on board. Organisations are populated with cynics. Pick anything too easy and people won’t believe the results will be replicated with more challenging relationships; too hard and you’ll get tripped up along the way. You’ve got to anticipate how
Process – get to value faster
To counter the argument that getting a company-wide programme underway takes too long, start small and demonstrate swift and significant success. State of Flux has developed the ‘Value Accelerator’ approach, which operates like a live proof of concept and rests on the selection of a few key suppliers. Working more closely with them should generate demonstrable benefits within weeks and provide the momentum and leverage required to expand any pilot. Once value is demonstrated in one area, it’s much easier to get the broader business on board. You start to feel them pull, rather than push- back. This is vital, because for supplier management to do well you need a
4 STATE OF FLUX
2020 GLOBAL SRM RESEARCH REPORT
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