2023 GLOBAL SRM RESEARCH REPORT
GOVERNANCE
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65
Change to Reflecting on the lessons learnt from the COVID-19, the criteria for segmentation will need to look different going forward, with an increased awareness of risk and supply chain vulnerability. Treatment strategies will turn segmentation into action, and must include collaborative behaviours that will support suppliers being considered part of the extended enterprise. We need to keep pushing effective and efficient contract, performance and risk management as the fundamental building blocks of supplier management, as without these, the goal of incremental value is not achievable. These important disciplines also need to take more advantage of technology. Governance continues to be an often misunderstood term. When the surface is scratched, it can turn out to be a loosely defined set of meetings and reports that lack structure and a disciplined approach. As unattractive as it might appear, we believe that organisations need to ‘roll up their sleeves’ and develop strong governance models with the help of technology that encompasses all the elements of contract, performance, risk and relationship management. To bring suppliers into an extended enterprise, it will be necessary to develop more integrated governance models with two-way reporting. The key opportunities in the area of governance are: Realign segmentation criteria and weighting to reflect the post-COVID view of supply chain vulnerabilities. • Develop the model behaviours expected of both parties based on the target relationship identified through segmentation. • Develop more integrated governance models and two-way reporting. • Use technology to make governance as effective and efficient as possible.
“Organisations need to roll up their sleeves and develop strong governance models”
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