2024 GLOBAL SRM RESEARCH REPORT
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“Evolving relationships from transactional to strategic is the most common strategy that respondents plan on implementing to enhance the return on supplier management. However, it is crucial that this is done in conjunction with segmentation to maximise potential value and ensure focus on the right relationships.”
Barriers to quantifying return The difficulty of quantifying return on relationships is often due to perceived barriers of measuring its value. Our research shows 62% of respondents saw access to accurate or meaningful data as a barrier to quantifying value. Furthermore, 53% of respondents believed that resource constraints were an issue. These barriers are largely consistently reported across maturity levels. However, there are areas where differences exist between Leaders and Followers. Access to meaningful data is seemingly more of a concern for Followers, with 66% of respondents believing this is a barrier compared to 55% of Leaders. Followers also report a struggle with resource constraints (57%) more than Leaders and Fast Followers (45%). Conversely, reliability of third-party data is seen as more of a barrier to Leaders than Followers. However, despite these slight nuances, the common view of barriers does give us a clear view on what needs to be addressed to help organisations better quantify returns. Future looking strategies When asking respondents to identify the strategies they plan on implementing to improve return on supplier management in the future, most respondents selected that they plan on evolving relationships
from transactional to strategic (70%) – implying that organisations are starting to recognise the value in implementing a relationship- centric approach. This is seen across maturity levels, with 67% of Followers stating this ambition. Investing in sustainability, digital infrastructure and learning and development initiatives were also commonly cited answers. Leaders appear to have significantly more plans to improve return on relationships through developing collaborative innovation hubs – cited by 45% of Leaders, compared to 21% of Fast Followers and 15% of Followers. Collaborative innovation hubs are an effective way to foster creativity and accelerate problem-solving, driving the creation of opportunities for growth across an organisation or supplier network. Cultivating ecosystems of interconnected suppliers is also on the agenda for 47% of Leaders, compared to 22% of Followers.
This activity illustrates the true essence of the ‘relationship’ or ‘reputation’ age, focusing on establishing a relationship-centric approach to supplier management, rooted in trust and collaboration. What strategies do you plan to implement to improve the return on supplier management? Leader Fast Follower Follower Evolving relationships from transactional to strategic 67% Greater emphasis on sustainability and ethical sourcing 45% Investing in technology and digital infrastructure 66% 55% 42% Continuous learning and development initiatives for internal stakeholders 61% 55% 42% Building supplier diversity 47% 45% 28% Fostering ecosystems of interconnected suppliers and partners 47% 27% 22% Developing collaborative innovation hubs 45% 21% 15% Strengthening brand reputation 24% 17% 11% No strategic changes 0% 2% 10% 66% 65% 76% 76%
What factors prevent you from quantifying the return on your relationships?
Overemphasis on short-term benefits 34% 23% 29% Reliability of third-party data 32% 27% 15% Required capability 32% 17% 24% Budget restraints 16% 17% 20% No barriers 5% 6% 3%
Leader Follower Access to accurate/meaningful data Fast Follower 66% Complexity of relationship dynamics e.g. multifaceted interactions 55% 55%
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50% 49%
43% Resource constraints
45% 45%
57% Difficult to attribute benefits to the relationship 39% 36% 40%
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