COLLABORATION
SRMMAKES SUPPLIER NEGOTIATION MORE CONSTRUCTIVE
SRM LEADERS ARE MOST LIKELY TO BENEFIT FROM SUPPLIER INNOVATION
LEADERS ARE MOST LIKELY TO HAVE A PROCESS IN PLACE FOR SUPPLIER INNOVATION
Innovation is consistently seen as one of the key business drivers for SRM and relies on strong collaboration and trust between parties. Leaders and followers are far more likely to be actively seeking more supplier innovation. All of the leaders in our survey are doing so, compared with only 71% of others. Perhaps this is because less mature SRM programmes are focusing on other things. While most of our respondents are looking for supplier innovation, whether they get it depends largely on their success with SRM. Companies are increasingly realising what a vital source of competitive advantage harnessing the capability of their supplier base can be. Themost positive impact of SRM is that discussions aremore constructive, both parties are prepared to take a long-termview and better outcomes are achieved by both parties. Overall only a small proportion of respondents report benefiting in any significant way from supplier innovation. Of these the vast majority come from the leader and follower groups. Among leaders, 17% report they greatly benefit from supplier innovation and 38% report benefits have been creditable. The other group of companies see very little or no supplier innovation. For these companies supplier innovation is an untapped opportunity. The industry sectors that experience strong benefits from supplier innovation are the IT/high tech and oil and gas sectors. The public sector is the most likely to see very little supplier innovation. It is of no surprise that SRM leaders are most likely to benefit from supplier innovation. They are also more likely than any other group to employ an effective process to manage supplier innovation.
Fig 40. To what extent are you currently benefiting from supplier innovation?
Fig 39. In what way, if any, has SRM changed the nature of negotiations with your key suppliers?*
Fig 41. Do you have an effective* process tomanage supplier innovation?
%
Leader
Follower
Other
%
Don’t know
Yes
No
Follower
Leader
Greatly - supplier innovation is akey component of our growth strategy
Other
16
12%
Discussions are more constructive
25%
8
%
50%
1
44
73%
Creditably - supplier innovation is an increasing element of our growth strategy
Better outcomes for both parties
67%
38
36
45%
24
Both parties are taking a longer termandmore strategic perspective
15%
11
8%
5%
33
To some extent - some examples
*Effective is a documented process with clear ownership to: actively seek supplier innovation; accept and record ideas; filter efficiently; evaluate by relevant and qualified persons; make decisions and initiate projects; provide prompt and constructive feedback at each stage.
42
Supplier is bringingmore added value to the table
53
32
45
SNAPSHOT ANALYSIS Themajority of SRM leaders see benefit fromsupplier innovation either greatly or creditably. The same cannot be said for followers or other respondents. Clearly SRM is paying off in terms of supplier innovation. As the global competition intensifies, innovation sets companies apart. In this sense, SRM is a vital strategic investment.
Process and behaviours are less adversarial
Very little - very few examples
5
30
13
It'smaking it quicker to reach agreement
32
Not at all - No examples
24
0 0
No change
8
4
Less involvement from legal
Don’t know
18
0
44% of leaders have created a joint account planwith theirmost important suppliers
Don’t know
2
13
8
*This analysis is for all respondents.
84
85
COLLABORATION STATE OF FLUX 2017 GLOBAL SRMRESEARCHREPORT
COLLABORATION STATE OF FLUX 2017 GLOBAL SRMRESEARCHREPORT
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