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SRM can no longer be described as a new concept or discipline, yet relatively few organi- sations have not found the optimum operating model. Clearly there is no ‘one size fits all’ solution, but it would help to review some of the fundamental issues to be considered when designing the operating model. Much of the debate around the best operating model starts from pre-conceived ideas. For example:
› › SRM must be in the business unit or function › › SRM must be a procurement responsibility › › The business unit or function must ‘own’ its own relationships › › We cannot increase headcount › › The role must be dedicated › › The role must be combined with category management or sourcing
Many organisations will accept these preconceptions and look to find a solution that fits. We would suggest these preconceptions are put on hold and a more logical approach is adopted in order to make a decision based on facts, and known risks and opportunities. Points to consider › › The purpose and objectives of the role must be aligned to the SRM value proposition, and the organisation’s vision and objectives. › › A role profile needs to be developed that defines key accountabilities and responsibilities. › › An evaluation of the resource (FTEs) required to deliver the objectives of the role - based on a risk and opportunity profile of a properly segmented supplier base. › › Is it possible to benchmark the effectiveness of alternative operating models? › › What are the real pros and cons of the alternative operating models within the context of your own business? › › What is the preferred operating model to deliver maximum benefit to the business? › › Does this support a business case for organisational change or increased headcount? › › What compromises need to be made, and how will these impact the effectiveness of SRM and its ability to deliver benefits? At one of our post results workshops, the head of SRM for a leading transport group said: “We have to move away from SRM being something that’s seen as addi- tional to the day job. For it to work it needs to become the day job”. We would support this view. As long as SRM is seen as something that can be done in ‘spare moments’, it will not achieve its potential and deliver real business benefit.
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