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AN INDUSTRY SECTOR PERSPECTIVE The ability to harness supplier innovation does not vary significantly across industry sectors. The only two industry sectors where more than 50% of respondents believe they are either good or very good at capturing supplier innovation are FMCG and IT / hi tech . No respondents from the oil and gas or manufacturing sectors report as being very good . The sector with the biggest challenge appears to be oil and gas where over 60% of respondents report being poor or very poor .
Figure 6.5. Ability to attract, evaluate and implement supplier innovation – industry sector
1
3
■ FINANCIAL SERVICES ■ FMCG/CPG ■ IT/HIGH TECH ■ MANUFACTURING ■ OIL AND GAS ■ UTILITIES
60%
50%
40%
30%
20%
10%
2
0%
VERY GOOD
GOOD
POOR
VERY POOR
DON'T KNOW
Innovation is without doubt the single SRM benefit area that is proving the biggest challenge to realise. Its significance as a business driver and area of potential value cannot be overstated. However, unless determined strides are taken to develop an innovation strategy and process the opportunity could be missed. The organisa- tions within industry sectors that are first to move in this area undoubtedly have a huge opportunity to improve competitive edge. Take the example of Procter & Gamble quoted in the case study on page 41. “We recognise this and it has to be balanced with the need to develop and fuel our innovation pipeline from external business partners. We have focused resources to help guide the commercial and tech- nical innovation work with our most critical business partners”. – MARY K WAGNER, HEAD OF P&G GLOBAL PURCHASES For SRM in general the impact could also be far reaching as the apparent failure to deliver this corner stone of the value proposition might well begin to undermine confidence in other aspects of SRM. For more information on innovation see the State of Flux white paper ‘does the innovation you receive from suppliers demonstrate that you are a customer of choice?’ reproduced on page 45.
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