2024 GLOBAL SRM RESEARCH REPORT
COLLABORATION
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When considering return on relationships in supplier partnerships, collaboration is key. Through collaborative relationships, organisations can harness engagement to drive initiatives that deliver mutually beneficial outcomes, working together across organisational and internal boundaries. This year’s respondents report a number of benefits from closer collaboration with their core suppliers, including: improved trust (57%), innovation and continuous improvement (53%) and enhanced engagement (49%). These are encouraging indicators that collaboration can help drive value and align relationships towards common goals. However, when analysing the data we see a significant missed opportunity. Many companies are not fully embracing collaboration across their entire supply chain. Instead, they are concentrating efforts on a handful of suppliers, thereby forfeiting the broader benefits that wider collaboration could yield. Alarmingly, a large proportion of companies have an opaque view of their suppliers; almost 40% have not mapped their supply chain, and surprisingly 1% are unaware of the benefits of doing so. As external pressures intensify, whether greater sustainability, diversity, or inclusivity, organisations will find that understanding and engaging with their entire supply chain is not just beneficial, but essential. This shift will be crucial for companies aiming to enhance their reputation and meet the evolving expectations of stakeholders. The time to act is now, before the window of opportunity narrows further. Many companies continue to overlook the power of joint account planning, instead fixating on extracting maximum value from suppliers without exploring how they can elevate the relationship to the next level together. This narrow approach limits the potential for true collaboration. It’s essential organisations expand their focus beyond only strategic suppliers. Collaboration has the potential to be far more expansive, reaching into untapped areas. Tail spend, often representing 80% of an organisation’s spend, is regularly neglected, but frequently holds a wealth of untouched value waiting to be unlocked. By broadening collaborative efforts, companies can uncover new opportunities for innovation, efficiency, and growth that benefit all parties involved. The key opportunities for greater collaboration are: • Explore the supply chain in depth, identify key suppliers, and align on common goals to foster innovation. • Embrace collaborative behaviours with suppliers to maximise the return on relationships. • Implement joint account plans to outline shared objectives and devise strategies to identify, deliver and track mutual value. • Leverage 360-degree feedback to build healthier, more collaborative relationships.
“Collaboration is the key to unlocking the full potential of supplier relationships. While many more mature organisations are reaping the benefits of closer partnerships, there remains a significant missed opportunity across all maturity levels.”
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