ABOUTOURRESEARCH
ABOUTSRM, STATEOFFLUX ANDOURRESEARCH
Follower
Other
Fig 1. Assessment of 2017 global SRMmaturity*
2017 SRM Index
Advanced
Leaders
4.3
37 companies (10%)
Established
Followers
3.4
Developing
58 companies (16%)
Others
Undeveloped
2.3
277 companies (74%)
Value
Collaboration Technology
Governance Engagement
People
*Maturity is assessed by examining responses to selected survey questions.
ABOUTOURRESEARCH
LEADERS, FOLLOWERSAND OTHERS
YOURSRMBENCHMARK AND INDEX
ABOUTSRM
ABOUTSTATEOFFLUX
STATEOFFLUXSRMBENCHMARK AND INDEX
This research is now in its ninth year. In that time a body of knowledge about global SRM practice and experience has been compiled that includes feedback from over 1800 companies and over 1 million data points. This year we have analysed data collected from 575 respondents representing 372 global companies across more than 25 industry sectors. In addition to this we have collated revealing case studies from food manufacturing giant Kellogg, leading US energy firm AEP, diverse UK retailer the Co-op Group, the Australian Department of Defence and Caltex, Australia's leading transportation fuels company.. They show what these firms are achieving and how they are progressing on the SRM journey. We also hear fromCargill, one of the world’s largest suppliers of agricultural products and food ingredients, to gain a supplier’s perspective on how customers can get more from them, if they manage the relationship in the right way.
Supplier relationship management or SRM is a concept that continues to confound its advocates by the apparent difficulty that organisations have, firstly to understand and accept its benefits and then adopt the change that will deliver those benefits. SRM at its most simple is the acceptance that firstly all suppliers are important to an organisation, but not equally so. SRM defines a differentiated approach to supplier management based on the importance of each supplier to the organisation. Once this is established differentiated treatment strategies can be adopted that optimise relationships to maximise the joint value they can create. This manifests itself in many ways ranging from ensuring that the value already contracted for is delivered, to the improved management of risk, creation of brand new value via supplier innovation and collaboration.
State of Flux is a specialist procurement and supply chain consultancy with clients in the UK and Europe, USA and Australasia. Over the past 13 years we have combined our research findings and practical experience to develop a deep understanding of SRM and have helpedmany businesses to explore and improve their supplier management capability. This experience has enabled us to develop amodel for SRM best practice based on six pillars of capability that when implemented effectively enable the journey to SRM and value.
In our research, we break down the response sample into leaders, followers and others according to how they perform on key SRM criteria. LEADERS: Leaders are companies that we believe have developed more mature and successful SRM programmes. This year we have identified 37 companies as leaders against more challenging criteria. This compares to 29 in 2016. The leaders represent 10% of the total respondents. FOLLOWERS: Followers are in a group of 58 companies representing 15% of total respondents. This is a reduction from 2016 when 101 companies were in this category. This results frommore stringent criteria to qualify as a follower and what we believe is an increasing gap between leaders and followers. OTHERS: Others represent 277 companies (75% of respondents) ranging from those where their SRM ambition is limited and reflects mostly contract and performance management to those with genuine SRM ambition but are at the start of their journey. These companies may well represent pockets of good practice but they will lack a clear strategy, senior leadership support and a consistent approach.
Participants of our SRM research are able to request a complimentary benchmark and index score which will benchmark your organisations SRM activities against best practice and your industry peer group. If you would like to obtain a benchmark and index score, please contact: enquiries@stateofflux.co.uk
The State of Flux SRM benchmark and index is designed to make it easier for businesses to establish a baseline for their performance and set targets for improvement. The index score is calculated based on the responses received to specific questions within our 2017 SRM survey. These questions are selected to reflect what organisations are actually doing and experiencing, and are weighted to reflect their importance to an effective overall approach to SRM.
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STATEOFFLUX 2017GLOBAL SRMRESEARCHREPORT
2017GLOBAL SRMRESEARCHREPORT
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